Wednesday, Jan 07, 2015

London will see the first marked falls for more than five years,

Guardian: House prices will drop across the UK in 2015, says CEBR

“Leading indicators such as fewer new buyer inquiries and properties taking longer to sell already point to falling prices,” said the CEBR. “Even after May, when the elements of political and taxation uncertainty are less of a factor, the CEBR does not expect a strong post-election bounce back.”

Posted by debtserf @ 11:32 AM (4354 views)
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12 Comments

1. hpwatcher said...

It's a slow time of year; I guess we will know for sure later in the year.

Wednesday, January 7, 2015 11:44AM Report Comment
 

2. khards said...

You're not going to know much about 2015 on the 7th January.
The market's been slowing down since the rush to beat the May 2014 MMR panic.
I guess buying activity will have a slight uptick in March - September, like every year.
There will be a lot of disappointed sellers and many posts on MSE saying that their $hitty London flat's been on the market 18 months and not selling etc.
Outside London it should be a better time to pickup a house than the last couple of years, with the lack of approved buyers and new-builds failing to sell.
And beyond that nobody knows and anything else is pure speculation and outside of the UK's control.

Wednesday, January 7, 2015 12:01PM Report Comment
 

3. hpwatcher said...

I guess buying activity will have a slight uptick in March - September, like every year.
There will be a lot of disappointed sellers and many posts on MSE saying that their $hitty London flat's been on the market 18 months and not selling etc. Outside London it should be a better time to pickup a house than the last couple of years, with the lack of approved buyers and new-builds failing to sell. And beyond that nobody knows and anything else is pure speculation and outside of the UK's control.


I think UK government will have so many crisis on their hands, the lack of a rising housing market will be the least of their problems.

Wednesday, January 7, 2015 12:10PM Report Comment
 

4. p. doff said...

If you want an alternative view, the RICS 2015 UK Housing Market Forecast anticipates UK house prices increasing by 3% and rent increasing by 2% in 2015.

Wednesday, January 7, 2015 12:14PM Report Comment
 

5. khards said...

The rent increase might well come true, it depends on how much more parasitic landlords can suck from tenants. Fuel costs are down (heating and petrol), shop price inflation seems low to me.
It could allow a little wriggle room if that magic combo results in the 'landlords utopia of real wage inflation'.

Wednesday, January 7, 2015 12:39PM Report Comment
 

6. hpwatcher said...

If you want an alternative view, the RICS 2015 UK Housing Market Forecast anticipates UK house prices increasing by 3% and rent increasing by 2% in 2015.

It's a view, but it's availability of [cheapening] credit that will determine house price rises, thankfully not the surveyors.

Wednesday, January 7, 2015 01:02PM Report Comment
 

7. khards said...

It's almost like a repeat of 2008 again, but instead of LTV multiples becoming detached from risk this time it's interest rates becoming detached from risk.

After all once lots of people become underwater and in negative equity, they will still default creating losses for the banks. Does a 4% interest rate with a bank spread of 1.29% sound sensible?

Wednesday, January 7, 2015 02:17PM Report Comment
 

8. taffee said...

If prices fall with all these props then perhaps rates can never rise and we go ala Japan
With falling prices over a long time...20 years..like oil and GDP from 1980

When prices fall below MORTGAGE people tend to throw the towel in and are more likely to
Default

BTL could be a catalyst to for deep falls as without capital growth it makes no sense

Either way it's gonna be bad imo

Wednesday, January 7, 2015 03:13PM Report Comment
 

9. taffee said...

That's oil and GOLD

Wednesday, January 7, 2015 03:14PM Report Comment
 

10. stillthinking said...

Personally, I don't believe it, not for the 170K ish properties outside London. I think there will be a lot of demand specifically around that price range. the government will never let deflation happen, its already clear, and holding up the prices of pants and electronics by pumping an extra 10% per year of the money supply will have its usual effect on asset prices.

Back in 2005 I was convinced that there was going to be a crash in house prices, but actually there was a deliberate devaluation of sterling by around 40%. It worked, there was no panic, probably the government was as happy as a pig in sh*T they could take over spending to "reflate" the economy. The same thing will clearly happen again. The government will -never- allow deflation to occur, they will not allow the market to clear.

There is no way I want to hold sterling against UK properties, or pretty much anything for that matter, because the only thing that will ever happen to sterling is for its half-life which is currently about ten years, to worsen. Pensions, saving at zero interest, give up on it.

Wednesday, January 7, 2015 08:38PM Report Comment
 

11. hpwatcher said...

Back in 2005 I was convinced that there was going to be a crash in house prices, but actually there was a deliberate devaluation of sterling by around 40%...The same thing will clearly happen again. The government will -never- allow deflation to occur, they will not allow the market to clear.

In fact, it was 2004 when the market was looking stagnant and good ol' UK gov came to the rescue with lower interest rates. The problem for them now, is that they have the housing plate to keep spinning, but a lot of other plates to keep spinning too. I have no doubt that UK government will do anything and everything to keep the UK housing party going, but as more and more problems gather - NHS, public sector pay strikes, general recession etc - they could find themselves simply unable to do it. And if we don't get single party government, keeping all the plates spinning could get harder and harder.

The indications are that the current deflation [scare], could well prove more powerful than anything else for a time.

Thursday, January 8, 2015 09:17AM Report Comment
 

12. mombers said...

@8 taffee interestingly UK mortgage holders are quite averse to 'throwing in the towel' when in nequity. Maybe cultural, maybe to do with mortgages not being no recourse (excuse the double negative), maybe to do with Support for Mortgage Interest. BTL do throw in the towel much more often though, hence much higher deposit requirements and interest rates. Since the private rental sector is so much bigger now, will be interesting to see how many BTL return the keys, especially when faced with no ability to increase rents if interest rates go up. Then again, maybe the government will turn up the Housing Benefit tap, feeding directly into 25% - TWENTY FIVE PERCENT - of private rents. Only then will rents be able to go up, so watch this space...

Thursday, January 8, 2015 12:42PM Report Comment
 

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