30% house price falls....that's optimisitic

[HousePriceMania]

 

 

 

[spunko]

I don't tend to listen to podcasts, can someone please give me the details on the claim that nice houses in cold places (?) will drop more - does she mean the North Pole? Or uninsulated houses?

[Cosmic]

A place I'd have previously been interested in has just come up - all I can think of is "shame, all those period features would have to go immediately to make way for 100mm insulation on every wall and high ceiling". Hopefully it will still be on when the bills land in spring with a few reductions in

[onlyme]

2 hours ago, spunko said:

I don't tend to listen to podcasts, can someone please give me the details on the claim that nice houses in cold places (?) will drop more - does she mean the North Pole? Or uninsulated houses?

Example was someone moving from small place in London to a big old house in Northumberland thinking they will be working from home but reality of that and heating it sinking in.

General gist of main guest, 20% gets back to start of pandemic, when prices were already toppy and in no way accounts for change in mortgage rates so 30% a far more likely outcome.

Plus issues with general costs going up as well  and BTL being loose holders of property and could offload in a large way when they were already reliant on capital appreciation alone in the first place in a  lot of cases and with increasing monthly deficits some will have no choice. 

[onlyme]

@spunkoforgot one staggering stat, prices so absurd average FTB wage had reached 60k, cannot believe that is right but if it is well, wholly unsustainable in the first place as a market, let alone with rate rises.

[MrXxxx]

20 minutes ago, onlyme said:

Example was someone moving from small place in London to a big old house in Northumberland thinking they will be working from home but reality of that and heating it sinking in.

General gist of main guest, 20% gets back to start of pandemic, when prices were already toppy and in no way accounts for change in mortgage rates so 30% a far more likely outcome.

Plus issues with general costs going up as well  and BTL being loose holders of property and could offload in a large way when they were already reliant on capital appreciation alone in the first place in a  lot of cases and with increasing monthly deficits some will have no choice. 

So how far back would 30% get us if 20% is just before the pandemic?

[spunko]

7 minutes ago, onlyme said:

@spunkoforgot one staggering stat, prices so absurd average FTB wage had reached 60k, cannot believe that is right but if it is well, wholly unsustainable in the first place as a market, let alone with rate rises.

Yeah I posted that in the other thread, though it is the household income combined.

Still shocking

[onlyme]

Just now, spunko said:

Yeah I posted that in the other thread, though it is the household income combined.

Must be.

[onlyme]

12 minutes ago, MrXxxx said:

So how far back would 30% get us if 20% is just before the pandemic?

Guessing a couple of years if that.

 

[Wight Flight]

1 hour ago, spunko said:

Yeah I posted that in the other thread, though it is the household income combined.

Still shocking

Which is sort of OK if we don't want breeding couples owning houses.

[Boon]

Remember that percentages ain't equal to each other because the amount is different.

So if £250k had gone up 100% to £500k, the round trip back to £250 is only 50%, and not 100%.

Using the same figs, £250k going up by 20% to £300k, if that then lost (for arguments sake) 33%, then that's down to £200k - reversing pandemic gains and then some.

But I disagree that nice homes in cold areas will fall the most. What about shit homes in cold areas? From what I see the lower end of the market gained a disproportionate sugar boost because of the SD holiday.

[haroldshand]

Well it's now or never in 2023 and I think that growing percentage of those waiting for the "inevitable" property crash are finally going to get it in 2023.. I was hoping someone might start some kind of barometer over the coming year like so many of those big headed c***s were doing as prices rose(myself included for a while).

Just as rough estimate and it's the type of generic numbers I see banded about so much and with the people I know or come across (some less some more), but a low £200,000 mortgage in a £350,000 home(at peak). Trust me just a 1% fall per month and seeing your £350,000 pride and joy going down £3,500(at first) per month is pretty scary stuff, get the odd 2 or even 3% falls per month and panic will set it.

I have seen bigger than 3% falls in a month in my lifetime, imagine someone losing £10,000 in a month, those bores at dinner parties and pubs in the 2010's are going to go very quite now.

[One percent]

18 minutes ago, haroldshand said:

Well it's now or never in 2023 and I think that growing percentage of those waiting for the "inevitable" property crash are finally going to get it in 2023.. I was hoping someone might start some kind of barometer over the coming year like so many of those big headed c***s were doing as prices rose(myself included for a while).

Just as rough estimate and it's the type of generic numbers I see banded about so much and with the people I know or come across (some less some more), but a low £200,000 mortgage in a £350,000 home(at peak). Trust me just a 1% fall per month and seeing your £350,000 pride and joy going down £3,500(at first) per month is pretty scary stuff, get the odd 2 or even 3% falls per month and panic will set it.

I have seen bigger than 3% falls in a month in my lifetime, imagine someone loosing £10,000 in a month, those bores at dinner parties and pubs in the 2010's are going to go very quite now.

Losing ffs, losing.  

[onlyme]

13 minutes ago, haroldshand said:

Well it's now or never in 2023 and I think that growing percentage of those waiting for the "inevitable" property crash are finally going to get it in 2023.. I was hoping someone might start some kind of barometer over the coming year like so many of those big headed c***s were doing as prices rose(myself included for a while).

Just as rough estimate and it's the type of generic numbers I see banded about so much and with the people I know or come across (some less some more), but a low £200,000 mortgage in a £350,000 home(at peak). Trust me just a 1% fall per month and seeing your £350,000 pride and joy going down £3,500(at first) per month is pretty scary stuff, get the odd 2 or even 3% falls per month and panic will set it.

I have seen bigger than 3% falls in a month in my lifetime, imagine someone loosing £10,000 in a month, those bores at dinner parties and pubs in the 2010's are going to go very quite now.

Its now, commented before on the inflation in the US, top of the list and not least food and basics, which we are still trailing significantly, the price rises there are eyewaterinw and feel we have a lot of catch up coming. From the recent PPI apparently for November vegetable prices up 38% in November month on month, 80% YOY, near doubling in 2022 and some suggesting doubling again in 2023 - impossible? - not when you consider factoring in energy input costs and fertiliser possibly not even being available in anything like  the volumes before which means crop yields way down. When the US sneezes and all that and the position that the BOE has very little wriggle room now, if they don't follow the FED sterling gets kicked in the nuts and everything that goes with that. Personal expenditure has been slammed this year and there is no sign of let up t all. once discretionary expenditure tails off the redundancies and short time working will follow leading to immediately distressed renters and owners thanks to very limited wriggle room in monthly budgets which have partly only been held up in the US by swiping the credit card.

VEGETABLE PRICES SURGE 38% IN ONE MONTH AS FOOD INFLATION EXPLODES

https://www.bitchute.com/video/o5g5RDISSm9H/

[Option5]

17 minutes ago, haroldshand said:

Well it's now or never in 2023 and I think that growing percentage of those waiting for the "inevitable" property crash are finally going to get it in 2023.. I was hoping someone might start some kind of barometer over the coming year like so many of those big headed c***s were doing as prices rose(myself included for a while).

Just as rough estimate and it's the type of generic numbers I see banded about so much and with the people I know or come across (some less some more), but a low £200,000 mortgage in a £350,000 home(at peak). Trust me just a 1% fall per month and seeing your £350,000 pride and joy going down £3,500(at first) per month is pretty scary stuff, get the odd 2 or even 3% falls per month and panic will set it.

I have seen bigger than 3% falls in a month in my lifetime, imagine someone loosing £10,000 in a month, those bores at dinner parties and pubs in the 2010's are going to go very quite now.

The problem isn't the rises or falls in on paper value, it's the mentality of assuming the values are real.

The only real figure is the purchase price. The value increase is only known when a sale is completed.

I know people who put everything into their house because "It's my pension" assuming it can only rise in value.

Some people of a similar mindset rely on the national lottery supplying their pension pot.

 

[Wight Flight]

7 minutes ago, Option5 said:

The problem isn't the rises or falls in on paper value, it's the mentality of assuming the values are real.

The only real figure is the purchase price. The value increase is only known when a sale is completed.

I know people who put everything into their house because "It's my pension" assuming it can only rise in value.

Some people of a similar mindset rely on the national lottery supplying their pension pot.

 

The fall in paper value will bugger the LTV and really hurt those trying to remortgage.

[haroldshand]

4 minutes ago, Option5 said:

The problem isn't the rises or falls in on paper value, it's the mentality of assuming the values are real.

The only real figure is the purchase price. The value increase is only known when a sale is completed.

I know people who put everything into their house because "It's my pension" assuming it can only rise in value.

Some people of a similar mindset rely on the national lottery supplying their pension pot.

 

Yes I know all that and of course agree.

These huge sums of money being borrowed in recent years to buy a house were frightening beyond belief only a few decades ago, I still remember a mate in the early 2000's shitting  himself over a mortgage of less than £50,000. But in recent years people have become desensitised to mortgage debt and as long as the "value" of the property was greater than the debt life made sense, even taking the off £10,000 out of the equity for treats seem to be justified by many.

I think banks/lenders could well of pulled off a blinder and  the greatest con ever, they now have an income steam for life  off that debt that they tricked people into building up with the illusion of "property wealth" which is now going to vanish, not the debt though

[MrXxxx]

13 minutes ago, onlyme said:

Its now, commented before on the inflation in the US, top of the list and not least food and basics, which we are still trailing significantly, the price rises there are eyewaterinw and feel we have a lot of catch up coming. From the recent PPI apparently for November vegetable prices up 38% in November month on month, 80% YOY, near doubling in 2022 and some suggesting doubling again in 2023 - impossible? - not when you consider factoring in energy input costs and fertiliser possibly not even being available in anything like  the volumes before which means crop yields way down. When the US sneezes and all that and the position that the BOE has very little wriggle room now, if they don't follow the FED sterling gets kicked in the nuts and everything that goes with that. Personal expenditure has been slammed this year and there is no sign of let up t all. once discretionary expenditure tails off the redundancies and short time working will follow leading to immediately distressed renters and owners thanks to very limited wriggle room in monthly budgets which have partly only been held up in the US by swiping the credit card.

VEGETABLE PRICES SURGE 38% IN ONE MONTH AS FOOD INFLATION EXPLODES

https://www.bitchute.com/video/o5g5RDISSm9H/

I have just returned from a six month overseas trip and am shocked by the increased supermarket prices...most things I bought before are now between 25-50% more expensive....and that's not accounting for the manufacturers trick of using the same packaging size but reducing the weight inside by 20-25% i.e. cereals 500-400g, yoghurt 500-450mls etc

[MrXxxx]

3 minutes ago, haroldshand said:

But in recent years people have become desensitised to mortgage debt and as long as the "value" of the property was greater than the debt life made sense,

..and desensitize to the value of money when buying a property when buying/making an offer i.e. "Oh its only another £10k for our dream home", yet these same people agonize over spending another £100 on a mobile!

[haroldshand]

2 minutes ago, MrXxxx said:

..and desensitize to the value of money when buying a property when buying/making an offer i.e. "Oh its only another £10k for our dream home", yet these same people agonize over spending another £100 on a mobile!

The worries and madness of taking on huge debt and not treating it with fear and respect  is soon to become a very real thing again. I just wonder if there are 40 year olds out there now who in 20 years time and going into their 60's who will look back at their shit expensive house back then thinking WTF did we do and who are still paying it off.

[Option5]

10 minutes ago, MrXxxx said:

..and desensitize to the value of money when buying a property when buying/making an offer i.e. "Oh its only another £10k for our dream home", yet these same people agonize over spending another £100 on a mobile!

I love the phrase "Dream home".

One day they'll wake up and the dream has gone.

Anyway it's just a house, home is wherever you lay your hat.

[One percent]

2 minutes ago, haroldshand said:

The worries and madness of taking on huge debt and not treating it with fear and respect  is soon to become a very real thing again. I just wonder if there are 40 year olds out there now who in 20 years time and going into their 60's who will look back at their shit expensive house back then thinking WTF did we do and who are still paying it off.

I keep mentioning the wessie couple I know, mainly because it beggars belief and I’m sure they are not the only ones.  They have a B&b (well flop house and the dropped doing breakfast) with an IO mortgage of quarter of a million, with no vehicle for repayment. Last year, he decided to relive  his yoof so a 10k loan for a motorbike he couldn’t handle. This year a brand new fuckoff BMW, over 50 k, again on some kind of finance.  They are out for meals all the time, splurge on new clothes and new stuff for the house constantly. Afaics, they have no pension.  He’s mid 60s she is late 50s.  Guess they will be working until they drop. What happens then, god only knows.  
 

On the surface, they look quite well to do. Fur coat and no knickers as my gran would say. 

[Wight Flight]

Looking at a real life example near me.

There is a block of two bed apartments that were mainly snapped up by BTL types for £200k. That is peak price for that kind place here.

They have been trying to let them for £10k p.a. Again the absolute peak for the two bed market.

Ignoring deposits etc, they are on a 5% return. With a 5% interest rate they are on break even before any costs.

To add to the fun I doubt any tenant will stay for more than six months, so fees and voids will be huge.

To get a sensible gross 10% return they either need to double the rent, or the property is only really worth £100k.

To square this circle, to rent one of these places you need to evidence an income of £25k. Which will get you a £100k mortgage 

I do like things that balance.

BTW the sums get worse on higher value properties.

 

 

 

 

 

[King Penda]

On 14/12/2022 at 22:22, Boon said:

Remember that percentages ain't equal to each other because the amount is different.

So if £250k had gone up 100% to £500k, the round trip back to £250 is only 50%, and not 100%.

Using the same figs, £250k going up by 20% to £300k, if that then lost (for arguments sake) 33%, then that's down to £200k - reversing pandemic gains and then some.

But I disagree that nice homes in cold areas will fall the most. What about shit homes in cold areas? From what I see the lower end of the market gained a disproportionate sugar boost because of the SD holiday.

The general public are to thick to have realised this yet it’s going to take at least 2 winters to sink in .I’ve got friends that have not even altered there consumption of fuel .

[Stuey]

21 minutes ago, King Penda said:

The general public are to thick to have realised this yet it’s going to take at least 2 winters to sink in .I’ve got friends that have not even altered there consumption of fuel .

I wonder when it becomes cheaper to eat more (especially proteinz) for the several degrees of thermogenesis than it is to crank the heating up. 

There's an idea for you Pends...