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Where will the property bubble burst first?


spunko
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With a crooked smile
3 hours ago, AWW said:

Christ, what industry are you in?

Presales, cloud based software. I was pretty supprised too. 

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This is simply a case of the wealth gap widening even further though right? I would say there is a correlation of being the further up you go, the less people that could possibly replace you.

Of course there may be exceptions to that, but overall I think the correlation is true.

My own sense is that a lot of the people in the bottom rung jobs are not getting big rises- you could get away with a lot less. See the NHS. 

So personally I still see the most vulnerable properties as those FTB buyer type properties, which were expensive to start with, have large service charges, and also in areas where there is a great density of them being sold.

Something like this is quite funny:

https://www.rightmove.co.uk/properties/111317804#/?channel=RES_BUY 

Don't know how they expect to get that when a similar is SSTC at £375k. 

After the sales go through this should create a problem for others. How can a valuation be justified when you have sales going through at lower prices? 

If food, energy and transport costs have gone up faster than wages for the rental class, then the theoretical maximum rent also decreases.

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Wight Flight
31 minutes ago, Boon said:

If food, energy and transport costs have gone up faster than wages for the rental class, then the theoretical maximum rent also decreases.

Nah. They will just increase LHA rates.

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8 hours ago, With a crooked smile said:

Presales, cloud based software. I was pretty supprised too. 

Interesting. I'm in Product Management for a similar company. How much are your prices going up by?

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With a crooked smile
1 hour ago, AWW said:

Interesting. I'm in Product Management for a similar company. How much are your prices going up by?

We've been more into driving down costs. Moving elements from private cloud to public ect. Buying customer base from elsewhere and converting to our product base. 

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I wish I could do the same as hosting our own infra costs a fortune, but unfortunately our customers are largely banks, and they are too ignorant, sorry, risk-averse to want to run anything important in the likes of GCP or AWS. They'd rather have a company with a hundred employees running the infra.

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With a crooked smile
11 minutes ago, AWW said:

I wish I could do the same as hosting our own infra costs a fortune, but unfortunately our customers are largely banks, and they are too ignorant, sorry, risk-averse to want to run anything important in the likes of GCP or AWS. They'd rather have a company with a hundred employees running the infra.

Yeah it's interesting, can't give to many details here but we have major parts of UK gov that are particularly security conscious taking our vanilla public cloud offering. 

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moneyscam

Anecdotal but interesting to me at least. Was pulling into my drive and I recognised the agent that sold my house last year taking pictures of a neighbours house outside. Asked her how much they were selling it for, she said £400K, I was like blimey they paid £350k for that only a year ago. So I asked her just out of interest (no intention to sell) if she could have a quick look at mine and tell me what she thought it would go for in current market. She said £380K after I told her I paid £325K 18 months ago to which I replied that's ridiculous, max I would have valued it currently was £340-350K range.

We both agreed the market was still bonkers but she did say she saw it cooling off this year and that many sellers were being unrealistic with kite flying prices and that those were not shifting.

I expect with the cost of living squeeze, end of stamp duty and end of furlough she will be proved right. I really pity the young just starting out today and can see the UK becoming like Italy where the 'kids' don't move out till their early 30's.

 

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Frank Hovis
15 minutes ago, moneyscam said:

Asked her how much they were selling it for, she said £400K, I was like blimey they paid £350k for that only a year ago

 

They're not going to have a lot left of that theoretical £50k profit after legal fees, stamp duty, estate agent fees and moving costs.

I hope that isn't the reason for their moving but it's instead troublesome neighbours  ;)

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moneyscam
16 minutes ago, Frank Hovis said:

 

They're not going to have a lot left of that theoretical £50k profit after legal fees, stamp duty, estate agent fees and moving costs.

I hope that isn't the reason for their moving but it's instead troublesome neighbours  ;)

Haha it's not me I promise. Fortunately, no issues so far with neighbours, it's a very quite middle class mixed area. Mostly families, I must be one of the few if not only single occupiers.

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Bobthebuilder
20 hours ago, Wight Flight said:

Which is over £100k gross to buy a 2 bed semi in many parts of the country.

How many people/ couples have that much left over at the end of the year? Seems to me that most of the risk has been put on the buyer, rather than the bank now.

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13 hours ago, Bobthebuilder said:

How many people/ couples have that much left over at the end of the year? Seems to me that most of the risk has been put on the buyer, rather than the bank now.

Theres an element of that.

Best mortgage rates are for 40%, which protects the bank.

Chuck in the banks capital ~20% - and theres got 50% fall before the BoE needs to worry or kick ass.

Again, the BoE appears to be looking at getting out mortgage.

BoE is deleveraging  the UK mortgage  market. They might no come out and say that but thats whats they are doing.

Chunky (20%+ deposits), hefty chunk of bank capital (20%) and 3rd party bonds (5y+ fixed rates).

The days of mortgages of  2% bank capital and 98% drawn down from BoE are long gone and not coming back.

 

 

 

The risk is being put on the buyer, the bank and the bond markets.

 

And thats a good thing!

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haroldshand
On 05/12/2021 at 14:30, Frank Hovis said:

 

They must now be coming close to the end of the "How to utterly destroy a thriving internet forum in four easy stages" Haynes manual.

After seeing these few posts referencing ToS I am now looking this very minute at their website which makes it the 2nd time I have returned this month and as much as I previously visited in years.

I have scrolled down and gone through pages of posts which for me are the first I have read on their site and I have to say with hand on heart that there  is not one out of the thousands of posts that would make me feel that there is even a slight chance a property crash  incoming.

A whole fecking website with tons of advertising built on the premise that a property crash is inevitable and has been for two decades according to them and yet they don't seem to be able do any better than send a message of "We hope it will happen" just a fucking prayer IMO, Millions of posts by thousands of posters over the years  to send out a message where just one page and a few posts would have been more than enough

What a total waste of time and a joke that website is

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Frank Hovis
8 minutes ago, haroldshand said:

After seeing these few posts referencing ToS I am now looking this very minute at their website which makes it the 2nd time I have returned this month and as much as I previously visited in years.

I have scrolled down and gone through pages of posts which for me are the first I have read on their site and I have to say with hand on heart that there  is not one out of the thousands of posts that would make me feel that there is even a slight chance a property crash  incoming.

A whole fecking website with tons of advertising built on the premise that a property crash is inevitable and has been for two decades according to them and yet they don't seem to be able do any better than send a message of "We hope it will happen" just a fucking prayer IMO, Millions of posts by thousands of posters over the years  to send out a message where just one page and a few posts would have been more than enough

What a total waste of time and a joke that website is

 

Agreed, these days it reminds me of Heartburn Hotel where Harry Fisher bought a run down hotel in Birmingham and named it the Olympic Hotel, drinks in the Torville and Dean lounge, in the hope that Birmingham would host the Olympics and he would make a fortune.

They didn't and he is still running it.

(Great series IMO, co-written by John Sullivan).

ToS made a lot of sense for a long time but its sell by date has passed.

Most posts when I look are Remainers moaning about Brexit whilst being seemingly oblivious that it has happened and is now part of history.

It's like saying that we shouldn't retake the Falklands: it's gone, it's history.

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haroldshand
1 hour ago, Frank Hovis said:

 

Agreed, these days it reminds me of Heartburn Hotel where Harry Fisher bought a run down hotel in Birmingham and named it the Olympic Hotel, drinks in the Torville and Dean lounge, in the hope that Birmingham would host the Olympics and he would make a fortune.

They didn't and he is still running it.

(Great series IMO, co-written by John Sullivan).

ToS made a lot of sense for a long time but its sell by date has passed.

Most posts when I look are Remainers moaning about Brexit whilst being seemingly oblivious that it has happened and is now part of history.

It's like saying that we shouldn't retake the Falklands: it's gone, it's history.

I agree and ToS did open my eyes to a lot of what is happening in the financial world and where I once thought a lot of this anti banking rhetoric was over the top from conspiracy theory nutters I now know along with my crypto investment and research  what a bunch of evil c***s are in that industry.

But ToS  biggest failure was seeing the world how it should be in a logical commonsense mindset and totally underestimating the world as it really is which is  run by a small and very clever, greedy evil people who in many cases are household names and fucking you over with a smile that the public just cannot see.

But it does work both ways and though I think there is little chance now of a property crash in the short/medium term I also think BTL at some point will be totally f****d over by the same people.

Talk to so many of these recent BTL cult members who have come along in the last 15 years after being taken in by Kirstie Allsopp and the property porn media who in so many cases will tell you cash is shit(which it is) and how they are going to get moronic dumb tenants to pay their mortgages and in 25 years sail into the sunset with a fortune.

Well IMO a few will pull it off, the early few that exit on time, but this mass BTL plan of untold riches way in the future is just not going to happen, by then there will be millions of renters with no pensions and no means to pay the rent and will turn on those that fucked them over for so many years as planned by those at the top who would have already got out.

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Was wondering all day where to post this;

https://www.theguardian.com/society/2022/jan/16/uproar-in-the-garden-of-england-at-homes-plan-that-could-swallow-up-villages

Yes in @spunko Garden of England.

Longish read and sorry but Guardian.

Lots of new build estates appearing in my area and looks like everywhere else that I have traveled.

My local new builds are not selling but still more estates are being built and never ending planning applications are appearing.

Is the article semi sugestind that new homes are being built so that an ample supply of social housing exists? I am pretty sure that up to 50% of new build estates will become social homes. The end of BTL is in sight.

 

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44 minutes ago, Bilbo said:

Was wondering all day where to post this;

https://www.theguardian.com/society/2022/jan/16/uproar-in-the-garden-of-england-at-homes-plan-that-could-swallow-up-villages

Yes in @spunko Garden of England.

Longish read and sorry but Guardian.

Lots of new build estates appearing in my area and looks like everywhere else that I have traveled.

My local new builds are not selling but still more estates are being built and never ending planning applications are appearing.

Is the article semi sugestind that new homes are being built so that an ample supply of social housing exists? I am pretty sure that up to 50% of new build estates will become social homes. The end of BTL is in sight.

 

It depends what you mean by "social housing". I haven't heard a peep about the local council buying up new builds here; if you mean "affordable housing" that is in fact sold to London Boroughs before the foundations go in so that they can move their scum tenants down here, then yes. But not 50%, they target 30-40% according to government policies, but the housebuilders end up reducing that further to 10-20%.

Still, even at 10% of 5000 houses, that's 500 new homes suddenly moving into the Borough, with 2-3 scumbags inside. That's a lot of crime and 'mental health issues' added to areas that traditionally had very little of either.

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Im guessing HSBC have a number of figures on household costs - they took loads of info for my mortgage app.

They'll be putting an extra 1k on price of littlies, and taking that off the income for lending.

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On 16/01/2022 at 21:30, spunko said:

It depends what you mean by "social housing". I haven't heard a peep about the local council buying up new builds here; if you mean "affordable housing" that is in fact sold to London Boroughs before the foundations go in so that they can move their scum tenants down here, then yes. But not 50%, they target 30-40% according to government policies, but the housebuilders end up reducing that further to 10-20%.

Still, even at 10% of 5000 houses, that's 500 new homes suddenly moving into the Borough, with 2-3 scumbags inside. That's a lot of crime and 'mental health issues' added to areas that traditionally had very little of either.

Every new build estate has about ~20% f the houses, put in ~10% of space, normally by the road or the crappy end of the plot.

This is for social housing.

You can easily pick these out after a year or two - junk in the garden etc.

A couple of new estate in Scabby, built @~5 years ago, are now experiencing HTB trying to exit.

The scum housed have made the estate such a shithole that noone will buy a house.

In terms of allowing FTB build up equity, HTB has destroyed it.

 

 

 

 

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50 minutes ago, spygirl said:

Every new build estate has about ~20% f the houses, put in ~10% of space, normally by the road or the crappy end of the plot.

This is for social housing.

You can easily pick these out after a year or two - junk in the garden etc.

A couple of new estate in Scabby, built @~5 years ago, are now experiencing HTB trying to exit.

The scum housed have made the estate such a shithole that noone will buy a house.

In terms of allowing FTB build up equity, HTB has destroyed it.

 

 

 

 

You don't need to wait that long. I often drive down new estates after a few months and you can easily pick out the scum social housing, the grass won't have been cut, the letterboxes are ripped off.

It is bizarre that so many people buy into this "equality for the poor" shite, when all new build social housing nowadays is tiny terraced houses, invariably badly built (even more badly built?!) and right next to the motorway, hidden away. They are like mini ghettos; depressing how little progress has been made or quite why people push for 'social housing'.

Frankly If I'm forced to have a slavebox estate built next to me, then the last thing I want is an extra 50 'social housing' properties with problem tenants inside. Is that snobby? Oh well. Heard too many horror stories of "mental health crises" i.e. psychopaths forced down here from London high on Class A running amok.

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43 minutes ago, spunko said:

You don't need to wait that long. I often drive down new estates after a few months and you can easily pick out the scum social housing, the grass won't have been cut, the letterboxes are ripped off.

It is bizarre that so many people buy into this "equality for the poor" shite, when all new build social housing nowadays is tiny terraced houses, invariably badly built (even more badly built?!) and right next to the motorway, hidden away. They are like mini ghettos; depressing how little progress has been made or quite why people push for 'social housing'.

Frankly If I'm forced to have a slavebox estate built next to me, then the last thing I want is an extra 50 'social housing' properties with problem tenants inside. Is that snobby? Oh well. Heard too many horror stories of "mental health crises" i.e. psychopaths forced down here from London high on Class A running amok.

 

I don't disagree with your example but what you are seeing is s106 housing - the proportion of affordable housing that the developer must build which will be the smallest houses on the smallest plots in the worst location such as entrance corner to an estate.

Social housing built by contractors specifically for councils or HAs will have a much better build quality than the standard new build.

It will have gone up this last couple of years but a three bed semi would typically have £100k build cost on a new build for sale but £160k for one specifically built for social housing.

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