Property crash, just maybe it really is different this time

[Boon]

7 minutes ago, Frank Hovis said:

Sorry to hear that.

Nah, those are the risks isn't it.

In any case it didn't work out bad for me as the SVR was base rate +0.5, so the interest rate basically went from 5% down to 1%, and then obviously the prices of property zoomed.

Can you imagine how silly it sounds to tell someone to do what I did because I had a lucky escape?

Yet this happens all the time on regular forums if someone asks if they should pay top whack, you'll get replies like 'we did, and it worked out ok for us, so therefore you should too'.

[Wight Flight]

52 minutes ago, spunko said:

What was the property market like at that time?

 

It was the early nineties. He had a mortgage with someone like Birmingham Midshires, who were desperate to close their mortgage book, so tried to get rid of everyone by hiking rates well above everyone else's SVR.

In the end he was one of the last few hundred they couldn't shift.

We fell out about that time, so I don't know if it ever got resolved or he just handed the keys back as he left for America leaving a rather large amount of debt behind.

 

[HousePriceMania]

Have they been told to get this crash over and done with asap ?
 

 

[Wight Flight]

35 minutes ago, HousePriceMania said:

Have they been told to get this crash over and done with asap ?
 

 

Soaring!? 

[Frank Hovis]

3 minutes ago, Wight Flight said:

Soaring!? 

Soaring.

[HousePriceMania]

18 minutes ago, Wight Flight said:

Soaring!? 

Soared to 1.75% with inflation at 12%

Tele-****s.

[dnb24]

The telegraph property headlines have been unreal this month-

 

[Frank Hovis]

I'm calling it.

Even the Daily Express is running with it.

From this...

 

 

To this today and even calling it a "bubble"!

Housing bubble warning as economic uncertainty could cause prices to fall ‘substantially’

HOUSE PRICES could fall "substantially" due to the current economic uncertainty as the market is being propped up by strong post-pandemic demand fuelled by cheap mortgages, an analyst has said.

By Aleks Phillips

13:55, Wed, Aug 17, 2022 | UPDATED: 13:55, Wed, Aug 17, 2022

https://www.express.co.uk/news/uk/1656516/house-market-bubble-warning-economy-inflation-cost-of-living-prices-fall-substantially

 

It looks like @JoeDavola and @Stuey looking to buy has been the final straw.

[HousePriceMania]

Word for the day....Imminent

imminent

 

1. about to happen.

 

 

 

1 minute ago, Frank Hovis said:

I'm calling it.

Even the Daily Express is running with it.

From this...

 

 

To this today and even calling it a "bubble"!

Housing bubble warning as economic uncertainty could cause prices to fall ‘substantially’

HOUSE PRICES could fall "substantially" due to the current economic uncertainty as the market is being propped up by strong post-pandemic demand fuelled by cheap mortgages, an analyst has said.

By Aleks Phillips

13:55, Wed, Aug 17, 2022 | UPDATED: 13:55, Wed, Aug 17, 2022

https://www.express.co.uk/news/uk/1656516/house-market-bubble-warning-economy-inflation-cost-of-living-prices-fall-substantially

 

It looks like @JoeDavola and @Stuey looking to buy has been the final straw.

You can't steal Property Lion's thunder.

Called it 4 weeks ago off the back of the data from RM.

[HousePriceMania]

14 minutes ago, dnb24 said:

The telegraph property headlines have been unreal this month-

 

It's like they have a new briefing....

Maybe they are trying to get Sunak shoe horned into power by scared boomers.

[No One]

22 hours ago, No One said:

286->298 (+12 in last 4 days)

298->293 (-5) *listed

Is it possible houses are being taken off to be put on again as a new listing on Rightmove? Why would EAs do this? Rightmove fee's?

 

[Axeman123]

6 minutes ago, HousePriceMania said:

It's like they have a new briefing....

Maybe they are trying to get Sunak shoe horned into power by scared boomers.

My theory: it's happening either way, get 'em bottomed out and rising again before the latest possible GE date.

New homeowners = new Tory voters, many of them with decades of voting ahead of them.

[GTM]

Something on my "suitable, but far too expensive" list came back on yesterday as unexpectedly re-available. Open house on Saturday the 9th of April (got to love EA's attention to detail), so clearly the "sale" has fallen through. Today they've just lopped 5% off the asking price. Only another 45% to go then.

[Boon]

31 minutes ago, No One said:

298->293 (-5) *listed

Is it possible houses are being taken off to be put on again as a new listing on Rightmove? Why would EAs do this? Rightmove fee's?

 

Common tactic for stale ones to do this.

Appears as a fresh listing and in the 'newly listed' category. Do think that listings get an initial flurry of activity and then dies down.

[onlyme]

2 hours ago, HousePriceMania said:

It's like they have a new briefing....

Maybe they are trying to get Sunak shoe horned into power by scared boomers.

Once it is a certainty the agents will talk it down, last time they tried to keep them elevated quite a few went bust, one local agent sold one house in 6 months.

Must say though rather rapid acceleration in fog horning about the current situation in the press, it had obviously reversed in some areas the last few months.

[HousePriceMania]

Can someone change this thread to "property crash, you've been stitched up like a kipper" ?

 

 

[HousePriceMania]

https://www.rbnz.govt.nz/hub/publications/monetary-policy-statement/monetary-policy-statement-august-2022

 

House prices have continued to fall towards more sustainable levels, and the outlook for residential construction has weakened

• House prices have continued to fall towards more sustainable levels. We expect house prices to decline further over coming months.

[Wight Flight]

I am hearing the smart money suggesting base rate will be 3.5% next year. EVE could well be 5.5%.

On a £300k mortgage that is £1,850 per month.

you need to earn £60k for that kind of mortgage, £3,600 take home.

£1,800 left. £450 on power, £300 on council tax and you are down to £1,100 for everything else. Best you don't have a car on £400 a month lease or an expensive commute (or want kids or a pension)

Many good earners could be underwater very soon.

 

 

[onlyme]

9 minutes ago, Wight Flight said:

I am hearing the smart money suggesting base rate will be 3.5% next year. EVE could well be 5.5%.

On a £300k mortgage that is £1,850 per month.

you need to earn £60k for that kind of mortgage, £3,600 take home.

£1,800 left. £450 on power, £300 on council tax and you are down to £1,100 for everything else. Best you don't have a car on £400 a month lease or an expensive commute (or want kids or a pension)

Many good earners could be underwater very soon.

 

 

That 60K wage is London wages, half a mil buys sod all.

House price earnings ratio was 5 in 2002, nearly 8 in 2018, got to be higher by 2022.

https://www.finder.com/uk/mortgage-statistics

[Wight Flight]

3 minutes ago, onlyme said:

That 60K wage is London wages, half a mil buys sod all.

House price earnings ratio was 5 in 2002, nearly 8 in 2018, got to be higher by 2022.

https://www.finder.com/uk/mortgage-statistics

But the house price to earnings is irrelevant to this. Pensioners in £1m houses skew it.

The trouble will come from those that bought in the last three years on a 5* salary borrowing.

[Axeman123]

It really does seem to be coming together, I really don't see interventions to stop it either.

[Wight Flight]

Just now, Axeman123 said:

It really does seem to be coming together, I really don't see interventions to stop it either.

Correct. Reducing to interest only, or extending to a 50 year mortgage is no help if it is the interest, rather than the capital repayment, that is wielding the knife.

[onlyme]

7 minutes ago, Wight Flight said:

But the house price to earnings is irrelevant to this. Pensioners in £1m houses skew it.

The trouble will come from those that bought in the last three years on a 5* salary borrowing.

Sure but everything is relative, would not be surprised to find there has been way more excessive borrowing than 5x and not in small numbers, the prices to earnings don't stack up, 

[sancho panza]

34 minutes ago, Wight Flight said:

I am hearing the smart money suggesting base rate will be 3.5% next year. EVE could well be 5.5%.

On a £300k mortgage that is £1,850 per month.

you need to earn £60k for that kind of mortgage, £3,600 take home.

£1,800 left. £450 on power, £300 on council tax and you are down to £1,100 for everything else. Best you don't have a car on £400 a month lease or an expensive commute (or want kids or a pension)

Many good earners could be underwater very soon.

 

 

The maths is very real.a lot of People have been living close to the edge but we're happy enough as their main asset was going up at a 10% clip.

One of the earliest trading lessons I learned was boy to spend your profits before you've banked them

You could easily add £300 in diesel costs,food bill £600.

 middle class people going to get a shock

4 hours ago, dnb24 said:

The telegraph property headlines have been unreal this month-

 

That's absolutely stunning. So on the way up they steer punters into the trade and then on the way down they steer punters away from it. 

 

You'd think there was money in fear

[Wight Flight]

4 minutes ago, onlyme said:

Sure but everything is relative, would not be surprised to find there has been way more excessive borrowing than 5x and not in small numbers, the prices to earnings don't stack up, 

I am the only one in my road of 30 houses that goes to work.

Houses worth maybe £600k on average.

They aren't all on £60k pensions.