Property Investors

[Tan]

The great house price crash 2005. Is on BBC 2 NOW!

 

[mark.t]

prices

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prices are high at the moment, the market is not moving,, their is a flood of 3 and 4 bed props and nothing is happening face it ....150k is out of reach of the majority of people..and most would struggle for 110k....unless its a 30 year mortgage or more .. or some deal which will tide them over for a couple of years the prices will begin to fall as estate agent revalue houses or start to price them up to 10 grand less than the middle of last year I feel sorry for the buyers of the last two years as they will find them selves in negative equity ...its all going to happen again...agents will feel the pinch sooner than expected and that's what will bring the prices down no sale no commission as for being a landlord not for me....my moneys under the bed..............the equity is means nothing its only in the banks favour my house is worth £? means nowt till its sold .... a case of counting chickens before they hatch
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Last edited by mark.t : 19-02-2005 at 11:38 PM


as I predicted in a previous thread

 

[Tan]

If the price crash does happen, it could potentially be worse than last time as many people have more than one property. I heard there are some properties in London, that are £40k in negative equity already.

The programe mentioned that many people are selling to rent, this surely is a bad sign of things to come.

 

[peterchurch]

Take the long term view does anyone know of a property that is cheaper than it was 10 years ago???

This is just shameless market making by people that will sit around talking the market down then buy up another half a dozen houses in the short term when a lull kicks in...

If rates went through the roof then I can see the problems but while they are staying put then there are no presures to keep moving house every 3-4 years...

 

[sparkyspost]

Having pretty much had to buy in London about 6 months ago, I'm chuffed to see this happening... NOT!

It is difficult to buy, but if like me and the missus, you make sacrifices to try to get on the property ladder. Now this!

We were only able to do this by having a good financial advisor to sort out a good mortgage for us. They can generally get you more than your high street with a lot less hassle.

But I have to agree with Peter, we have been hearing for 3 or 4 years that prices are going to be falling, that there will be a crash, and now it appears to be happening.

There is an old accountancy saying if only I could remember it... Something about self fulfulling prophices, and that is what the point of the exercise is for some of these people.

How can they make money on property if everyone is driving the prices up?

(Just a bit of conspiracy theory there - sorry)


To make money from property (in the south east at least - I know Belfast is going great guns at the mo.) it is definately a long term thing.

As long as you can afford your mortgage and don't want to move in the next few (5-10) years, then I would say you are better off with property than cash in the bank (or under your bed - mark t. )

Now that we've bought and am basically in negative equity, we are definately not looking to sell up in the near future. It will take drastic changes in personal life, or interest rates to force this! Interest rates of 15% anyone?

Boo hoo

Sparky.

 

[peterchurch]

How can they make money on property if everyone is driving the prices up?

(Just a bit of conspiracy theory there - sorry)

As long as you can afford your mortgage and don't want to move in the next few (5-10) years, then I would say you are better off with property than cash in the bank (or under your bed - mark t. )

Now that we've bought and am basically in negative equity, we are definately not looking to sell up in the near future. It will take drastic changes in personal life, or interest rates to force this! Interest rates of 15% anyone?


Sparky.

Sorry to hear about the negative equity But don't worry because you have already deemed to pay three times as much for your house through the interest payments over the next 25 - 30 years so a £10K+ loss is a drop in the ocean

Currently the winners are The banks that removed the lending limit to create this mess and Gordon Brown and the Treasury that now catch most people with higher rate stampduty

I am in the process of moving back to London / South East from Bath. When I moved out here the market was about to crash (ha ha) and I had set myself up for a 40K+ plus drop in equity Instead prices carried on through the roof ...

I feel sorry for the locals as although they are now faced with London pricing they still have Somerset salaries Now that is a B*tch when Bradley Stoke (nice estate in north of Bristol) went bust in the last crash, it took nearly a decade to get back to the same prices

 

[glojo]

After 12 months of standing empty two properties in the next Avenue have finally sold within months of each other, both sold for £1.25million each!

http://www.johncouch.co.uk/main.php?do=propdetail&pid=514&cat=5

(Ridiculously overpriced, on the side of a very steep hill) If houses like these are selling then hopefully there is movement all the way through the market. For houses at the top of the market to sell, you need houses at the lower end of the market to move.

I just wonder if the people spreading the rumours actually want prices to drop?

At the beginning of last week building societies were saying how property was starting to sell again! We have just got over the annual Christmas slack period, so I would have thought sales would have been fairly static and now they are starting to move.

It is understandable to be concerned if you have a large mortgage and very tight budget. We do however quite frequently get bombarded with this type of rumour spreading.

Regards,
John

 

[peterchurch]

After 12 months of standing empty two properties in the next Avenue have finally sold within months of each other, both sold for £1.25million each!

http://www.johncouch.co.uk/main.php?do=propdetail&pid=514&cat=5

(Ridiculously overpriced, on the side of a very steep hill) If houses like these are selling then hopefully there is movement all the way through the market. For houses at the top of the market to sell, you need houses at the lower end of the market to move.

I just wonder if the people spreading the rumours actually want prices to drop?

At the beginning of last week building societies were saying how property was starting to sell again! We have just got over the annual Christmas slack period, so I would have thought sales would have been fairly static and now they are starting to move.

It is understandable to be concerned if you have a large mortgage and very tight budget. We do however quite frequently get bombarded with this type of rumour spreading.

Regards,
John

I agree There are three houses in my area that have been up for more than 6 months that have sold in the last few weeks, and all of them acheived asking prices set last year before the "slump" so the proof is in the pudding

 

[Aswall]

House prices here show no signs of slowing down

 

[CAT220]

I've just bought a property in Glasgow and the market is still going strong with the Offers/Over "scheme" being as hard to predict as ever. Currently its anything between 15-30% above the O/o price.

 

[Shude]

I will hopefully be a first-time-buyer in the not-too-distant and I am keeping an eye on the trends and "predictions", sadly hardly any two groups have come up with the same results. Right now myself and a lot of potential first-timers are holding back on buying property because of fears of a short-term price crash, this means that although house values are apparently going up - less people are buying. When the market thins out the only thing that will attract us back is a fall in value/prices, so the day may yet come that values fall by as much as 10% in order that houses are sold at all. I have seen houses listed with quite high prices that have ended up going for sometimes 20% less in the end because the market just isn't there - a house is only worth what someone will pay for it, dispite the apparent "value" expected (especially sometimes over-inflated estate agency values!).

The property market has seemed like a great place to invest money in the last few years, you only have to watch a few minutes of daytime TV and you'll see a property-related show. The problem with property investment as opposed to more conventional investments is that the money goes to the wrong places, industry and businesses don't get the investment they need and this ends up hurting pensions and other conventional long-term incomes. I suspect that we'll end up with another increase in interest rates to make other forms of investment seem more worthwhile but sadly hurt mortgage borrowers.

Obviously I'd love a crash in house values, right now my house choices as a first-timer are practically non-existant, I'm going to have to buy a wreck of a place with plenty of "atmosphere", "potential" and "ideal for DIYers" in estate agency-speak!

 

[Howard]

House prices in our neck of the woods (SW london), show no signs of a downward turn, granted , they have started to slow a bit, but still not turned.
I bought my flat 2 years ago for £182k, i have spent about £7/8k modernising it and other 'modernised' flats in out courtyard are selling for £225k.

I think if you are looking to buy in London, then Richmond,Teddington,Molesey and the Hamptons are a dead cert.

Our local estate agents (Dexters) can't sell houses quick enough, on one road in Strawberry Hill, they have a waiting list, as soon as a house comes up for sale they ring whoevers on the list and usually sell it without even advertising it !

My last flat, which i rented in Teddington, i found out that the owner had bought it in 1995 for £71k and when she sold it in 2002 it went for £210k !! crazy !!

Shude, i really dont want a crash in house values thanks very much !!

 

[peterchurch]

Hi Shude,
I'm affraid that you will find that, in the event that the market crashes all the good property will just come off the market and you will be left to pick over the crap that is left over. I had this problem in 96. Although the prices were down, there was hardly any good property available

 

[Sp!ke]

I'd like a crash right now - Currently I own one house outright that I rent out. Meanwhile, I live in a rented property myself. (of a more suitable type)

So I'm definately in the market to buy if and when things bottom out

 

[peterchurch]

I'd like a crash right now - Currently I own one house outright that I rent out. Meanwhile, I live in a rented property myself. (of a more suitable type)

So I'm definately in the market to buy if and when things bottom out

A fair point but do you think you would have any tenants if people could afford to buy?

 

[Sp!ke]

A fair point but do you think you would have any tenants if people could afford to buy?

Well my tennant isnt going anywhere.... in fact one could say she sits

If she left I would be chuffed to bits as I could double the rent

 

[peterchurch]

Well my tennant isnt going anywhere.... in fact one could say she sits

If she left I would be chuffed to bits as I could double the rent

Yes but rental property is only attractive when people can't afford a home or when they want short stop houses... If you get a crash all the tenants will be off to buy before the prices go up and landlords will be left fighting over the few tenants left in the market which will push rents down and may shake out some of the the newer landlords that cant compete on rent due to the cost of the houses they bought at the hight of the market...

 

[gary350]

There are price differentials all over the place even in the same street but what is happening now is you are unlikely to sell a house with an extortionate price (which you could if you were very lucky 2 years ago) now your house/flat whatever must be priced correctly to sell, unfortunately some people are still living as if it was 2 years ago, so for sale signs still up at house for months and months could give the wrong impression.

gary

 

[sparkyspost]

If you get a crash all the tenants will be off to buy before the prices go up and landlords will be left fighting over the few tenants left in the market ...

Got to disagree with you there Peter.

If there is a crash, there won't suddenly be a stream of all the tennants looking to buy a house as like most people they will be scared that there is further to drop!
With a big demand to buy houses the market will rise.

Also not all tenants are interested or able to buy no matter the cost of houses. All would be interested in the effects of a house price crash as this would likely have the effect on their rent.

Sparky

 

[peterchurch]

Got to disagree with you there Peter.

If there is a crash, there won't suddenly be a stream of all the tennants looking to buy a house as like most people they will be scared that there is further to drop!
With a big demand to buy houses the market will rise.

Also not all tenants are interested or able to buy no matter the cost of houses. All would be interested in the effects of a house price crash as this would likely have the effect on their rent.

Sparky

I'm not sure, anyone that I have met in rental accomodation would do anything they could afford to get a flat/house they owned... Any small dip in an area seems to be quickly bolstered by first time buyers flooding out of rentals and mum and dads house because theres a chance they won't get a foot in the door if they don't.

Even if you lose 10% percent of the tenants in an area it will have to make a difference. If I was living at home looking for my first house and the market started sliding there would be no way I would look at renting a property if within a few months there could be a house at my level...

You have to remember that houses will get scarce, fast in the event of a slide because no vendor gets out of bed and says wow the markets hit the bricks lets sell our house for a whole chunk less than it was worth lest week