Property crash, just maybe it really is different this time

[Axeman123]

1 minute ago, Darude said:

Playing devil's advocate for a second, as a university lecturer she will be building up a defined benefit pension worth far more than she would get in the private sector. It doesn't solve their cashflow problems today but it likely means her working is pretty good for the household finances in the long run.

I assumed DB schemes were closed to new members in the 1990s(?). Her mentioning having had to stretch for a house and needing childcare would make me think she is too young.

I could easily be wrong though.

[Guest]

2 hours ago, Axeman123 said:

I assumed DB schemes were closed to new members in the 1990s(?). Her mentioning having had to stretch for a house and needing childcare would make me think she is too young.

I could easily be wrong though.

DB schemes are alive and well in most (all?) of the public sector, including to new entrants.

Edited July 9, 2022 by Guest

[CVG]

9 hours ago, Darude said:

DB schemes are alive and well in most (all?) of the public sector, including to new entrants.

Just had a quick look. This is what is on offer to new entrants:

"alpha pension scheme

If this is the first time you’ve worked for a public sector employer, you’ll be able to choose between alpha (a ‘career average’ scheme) and partnership (a ‘defined contribution’ arrangement).

In alpha your pension builds up quickly when you add your member contribution to your generous employers contribution. For example, if you earn between £23,101 and £45,500, you will contribute 5.45% of your salary and your employer will contribute 27.1%, meaning for every £1 you contribute, your employer will contribute almost £5."

including working for ....... The Pensions Regulator.

[Guest]

15 minutes ago, CVG said:

Just had a quick look. This is what is on offer to new entrants:

"alpha pension scheme

If this is the first time you’ve worked for a public sector employer, you’ll be able to choose between alpha (a ‘career average’ scheme) and partnership (a ‘defined contribution’ arrangement).

In alpha your pension builds up quickly when you add your member contribution to your generous employers contribution. For example, if you earn between £23,101 and £45,500, you will contribute 5.45% of your salary and your employer will contribute 27.1%, meaning for every £1 you contribute, your employer will contribute almost £5."

including working for ....... The Pensions Regulator.

Yes, I am familiar with the alpha pension scheme, it is a DB pension scheme.

That 27.1% employer contribution is amazing when you consider that most people in the private sector will be getting something like 5% employer matching into a DC scheme.

Edited July 10, 2022 by Guest

[Sasquatch]

There have been 8 properties for sale in our village the first half of this year. Two sold quite quickly, two sold and then came back on, the others looked like they were sticking. Just checked Rightmove and they've all sold! Prices ranging from £175,000 (2 bed semi) to £450,000 (4 bed detached). Quite surprised as I thought the market was starting to stagnate. I suppose the prices are lower than many parts of the country and people are moving into the area because of this?

[JoeDavola]

15 minutes ago, Sasquatch said:

There have been 8 properties for sale in our village the first half of this year. Two sold quite quickly, two sold and then came back on, the others looked like they were sticking. Just checked Rightmove and they've all sold! Prices ranging from £175,000 (2 bed semi) to £450,000 (4 bed detached). Quite surprised as I thought the market was starting to stagnate. I suppose the prices are lower than many parts of the country and people are moving into the area because of this?

Lots of well paid people still moving from expensive cities to smaller villages because the view is they’ll only have to go into the office once or twice a week, if that.

[haroldshand]

https://www.telegraph.co.uk/property/buy-to-let/how-britain-betrayed-buy-to-let-generation/

 

Well this sunday morning the Daily Telegraph are having their Bob Geldof Live Aid day and pulling out all the stops to save those poor BTL landlord victims.

Loads of separate articles all basically on the same subject and whinning from the BTL crowd is breathtaking, best article and where comments are being left as fast as you can read is about how "BTL landlords have been betrayed", I am staying out of the comments on this one as pro BTL seems to get it's way but the top comment is good and it counters with this beauty ...Statement and reader reply...

‘It was an era when Margaret Thatcher was urging investors to put their money into property, and he caught the first wave of the buy-to-let boom’.

Thatcher encouraged people to buy their own home. Not buy 37!

 

I am asking myself this morning are BTL rushing for the exit yet?

[Option5]

21 minutes ago, haroldshand said:

https://www.telegraph.co.uk/property/buy-to-let/how-britain-betrayed-buy-to-let-generation/

 

Well this sunday morning the Daily Telegraph are having their Bob Geldof Live Aid day and pulling out all the stops to save those poor BTL landlord victims.

Loads of separate articles all basically on the same subject and whinning from the BTL crowd is breathtaking, best article and where comments are being left as fast as you can read is about how "BTL landlords have been betrayed", I am staying out of the comments on this one as pro BTL seems to get it's way but the top comment is good and it counters with this beauty ...Statement and reader reply...

‘It was an era when Margaret Thatcher was urging investors to put their money into property, and he caught the first wave of the buy-to-let boom’.

Thatcher encouraged people to buy their own home. Not buy 37!

 

I am asking myself this morning are BTL rushing for the exit yet?

Not much sympathy in the comments 

[reformed nice guy]

59 minutes ago, haroldshand said:

https://www.telegraph.co.uk/property/buy-to-let/how-britain-betrayed-buy-to-let-generation/

Well this sunday morning the Daily Telegraph are having their Bob Geldof Live Aid day and pulling out all the stops to save those poor BTL landlord victims.

 

[haroldshand]

1 hour ago, Option5 said:

Not much sympathy in the comments 

I am watching a lot of the Tour De France on ITV4 and as you would imagine being one of the more crappy channels it gets all those tug your heart charity adverts, you know the type "Little johnny never smiles and is always dirty and bruised and when school finishes he dreads going home as he knows what awaits him, don't walk on by, help us help little johnny", they sometimes choke you as you reach for the phone and your credit card.

But going on the way BTL landlords behave I am waiting for the day they try one of these adverts...

"Rodney was a kind little BTL landlord with 27 properties, he never wanted to ever take 50% plus of his tenants wages, but his tenants so much loved him they insisted, several even naming their Children Rodney(two of them were girls) he was so adored. But then the evil government started picking on Rodney and made sure the properties he owned and rented out  could be kept warm and that tenants had protective rights, now poor Rodney can no longer go on five ski holidays and 3 Summer holidays per year and all his tenants will have to be thrown onto the streets and become prostitutes, please save poor Rodney and the 10,000's like him

Edited July 10, 2022 by haroldshand

[Sugarlips]

Sydney housing crash underway

https://www.macrobusiness.com.au/2022/07/stressed-agents-panic-as-home-buyer-demand-collapses/

[Plan-b]

53 minutes ago, Sugarlips said:

Sydney housing crash underway

https://www.macrobusiness.com.au/2022/07/stressed-agents-panic-as-home-buyer-demand-collapses/

Please please let it happen in the UK.

On the face of it oz has so much more going for it than the UK.

 

[haroldshand]

The article I mentioned today on the "poor BTL landlords" is probably the most venomous and nasty I have seen to date in the comments section, the anti BTL probably being the most unforgiving and hilarious of the two sides.

The comments are littered with " I am a lovely BTL landlord and my tenants love me...." or the that's the rough gist as the anti BTL just say   FUCK OFF

Read it it's worth it

[haroldshand]

https://www.telegraph.co.uk/business/2022/07/10/unlikely-london-suburb-where-fleeing-hongkongers-starting-new/

 

To be fair the Daily Telegraph, it's readers and myself went easy on the Hong Kongers arriving in the UK, most of the comments basically they are polite, respectful, educated and not a burden and won't find them poncing off the welfare state, loads of digs and Muzzers when stating that though

But regardless still loads more people entering the UK and more housing pressure

[tank]

14 hours ago, Sugarlips said:

Sydney housing crash underway

https://www.macrobusiness.com.au/2022/07/stressed-agents-panic-as-home-buyer-demand-collapses/

Up 30% since 2020 apparently.

A long way to go before it becomes a crash.

My prediction is a minor correction before more QE and per capita immigration ramped to 2% of population instead of the usual 1%.

11 hours ago, haroldshand said:

https://www.telegraph.co.uk/business/2022/07/10/unlikely-london-suburb-where-fleeing-hongkongers-starting-new/

 

To be fair the Daily Telegraph, it's readers and myself went easy on the Hong Kongers arriving in the UK, most of the comments basically they are polite, respectful, educated and not a burden and won't find them poncing off the welfare state, loads of digs and Muzzers when stating that though

But regardless still loads more people entering the UK and more housing pressure

There'd be a high percentage of Torygraph readers with BTL property portfolios Harold, just not the ones posting in the comments section. 😀😀

Edited July 11, 2022 by tank

[haroldshand]

2 hours ago, tank said:

There'd be a high percentage of Torygraph readers with BTL property portfolios Harold, just not the ones posting in the comments section. 😀😀

Yes that is the case, but there is now an amazingly high proportion in the DT of anti price ramping and anti landlords subscribers, many of the top comments are often those who want prices to crash and BTL to burn.

I actually put in a good comment for the Hong Kongers and I would of done so with the Polish and Gurkhas for example, their motives and loyalty good, but even with them there is a big problem in a best mate living on your sofa too long

[JoeDavola]

3 hours ago, tank said:

Up 30% since 2020 apparently.

A long way to go before it becomes a crash.

Yeah I see some houses in NI that even if they dropped by 20% tomorrow they'd be too expensive in my eyes.

And these prices in turn are dwarfed by the SE, which would need the biggest housing crash in history to bring it down to historically normal prices.

[Boon]

22 minutes ago, JoeDavola said:

Yeah I see some houses in NI that even if they dropped by 20% tomorrow they'd be too expensive in my eyes.

And these prices in turn are dwarfed by the SE, which would need the biggest housing crash in history to bring it down to historically normal prices.

Probably won't come.

And remember, the markets can stay irrational for longer than you can remain solvent.

I expect more headlines like this:

https://www.express.co.uk/finance/personalfinance/1636366/inheritance-tax-warning-money-planning-grandparents-UK-2022

If BOMAD gets exhausted due to parents having to contribute for deposits, this is the next frontier. The banks must be eyeing them up to see how their wealth can be incorporated to prop things up.

Again most people know this is wrong but because they have benefitted or will suffer otherwise choose to say nothing. Therein lies the problem. 

[JoeDavola]

11 minutes ago, Boon said:

Probably won't come.

And remember, the markets can stay irrational for longer than you can remain solvent.

I expect more headlines like this:

https://www.express.co.uk/finance/personalfinance/1636366/inheritance-tax-warning-money-planning-grandparents-UK-2022

If BOMAD gets exhausted due to parents having to contribute for deposits, this is the next frontier. The banks must be eyeing them up to see how their wealth can be incorporated to prop things up.

Again most people know this is wrong but because they have benefitted or will suffer otherwise choose to say nothing. Therein lies the problem. 

I agree.

I think that the market can stumble along in an irrational manner for many years, albeit at ever shrinking transaction levels.

The increased cost of living and rampant HPI has meant that fewer people than ever are moving, so inventory is at an all time low.

But this lack of supply in turn keeps prices high.

And a lot of the houses coming on are probate which haven't been looked after and need renovation.

But renovation costs are soaring even if you can get a builder so that kind of house isn't suitable for most buyers either.

It's a shit show that will only end IMO if many many homes are built, which I can't see happening.

Edited July 11, 2022 by JoeDavola

[haroldshand]

39 minutes ago, JoeDavola said:

I agree.

I think that the market can stumble along in an irrational manner for many years, albeit at ever shrinking transaction levels.

The increased cost of living and rampant HPI has meant that fewer people than ever are moving, so inventory is at an all time low.

But this lack of supply in turn keeps prices high.

And a lot of the houses coming on are probate which haven't been looked after and need renovation.

But renovation costs are soaring even if you can get a builder so that kind of house isn't suitable for most buyers either.

It's a shit show that will only end IMO if many many homes are built, which I can't see happening.

One thought I had this morning is that if variable rates are not at 15 year highs now they soon will be along with mortgage sizes that are now the biggest in history. If I was a ruthless lending institution and lets face it 100% of them are then all those on super low fixed rates I have handed out I would be telling them to f*** off and pay up the new high rate, where else can they go?

That's how it works boys and girls, these people are not your friends

[JoeDavola]

12 minutes ago, haroldshand said:

One thought I had this morning is that if variable rates are not at 15 year highs now they soon will be

Define 'soon', and would you bet the farm on that actually happening in the UK?

[haroldshand]

3 minutes ago, JoeDavola said:

Define 'soon', and would you bet the farm on that actually happening in the UK?

You must know me by now Joe when it comes to "property crashes" I am up and down like a whores draws with my opinions and prediction and am firmly now in the I will believe it when I see it camp.

Having said that there is now no denying that a storm is heading in that direction, but yes storms can be rode out. Just to keep things local for you  how about this 

https://www.belfasttelegraph.co.uk/business/uk-world/average-mortgage-svr-above-5-for-first-time-since-2009-41830372.html

OK that's 13 years but not far out and my money is on a 0.5 raise at the next BOE meeting

[JoeDavola]

7 minutes ago, haroldshand said:

You must know me by now Joe when it comes to "property crashes" I am up and down like a whores draws with my opinions and prediction and am firmly now in the I will believe it when I see it camp.

Having said that there is now no denying that a storm is heading in that direction, but yes storms can be rode out. Just to keep things local for you  how about this 

https://www.belfasttelegraph.co.uk/business/uk-world/average-mortgage-svr-above-5-for-first-time-since-2009-41830372.html

OK that's 13 years but not far out and my money is on a 0.5 raise at the next BOE meeting

Yeah to be fair that SVR is up from even last week when I was chatting to the girl from Dankse bank.

Now an SVR is generally the highest IR isn't it, you'd generally negotiate another fix before you'd go onto that.

It's when people can only get fixes at say 7% that the housing market would completely grind to a halt you'd think.

Maybe I'm wrong maybe everyone being forced to 5% would be enough to cause prices to crumble.

[haroldshand]

4 minutes ago, JoeDavola said:

Yeah to be fair that SVR is up from even last week when I was chatting to the girl from Dankse bank.

Now an SVR is generally the highest IR isn't it, you'd generally negotiate another fix before you'd go onto that.

It's when people can only get fixes at say 7% that the housing market would completely grind to a halt you'd think.

Maybe I'm wrong maybe everyone being forced to 5% would be enough to cause prices to crumble.

Most of the years where I held a mortgage fixed rates were generally higher than variable and the argument there was you were paying for security against sky high rates.

People are so funny, something is around for a decade or so and they think that's how it's always been

[JoeDavola]

1 minute ago, haroldshand said:

Most of the years where I held a mortgage fixed rates were generally higher than variable and the argument there was you were paying for security against sky high rates.

People are so funny, something is around for a decade or so and they think that's how it's always been

Well we had a 50% crash in prices in NI 08-12, and most seem to have forgotten that.

When I was chatting to the girl at the bank it seemed that the rate was about 3.5% give or take regardless.

I do remember at some point talking to a friend who had a 1.something percent mortgage, those days are gone obv.