quote:

Originally posted by malkie:
Not seen pgui post anything of the sort.

then what was

quote:

Look at the figures in my post above. These are the correct figures as given by the Halifax.

followed by

quote:

Spin, spin and soothing words.

Something's got to give I'm afraid.

People have been saying that year after year. Still waiting.......

Figures vs words - they tell different stories and for understandable reasons in the cold light of day - they cannot be seen to say anything else for various not hard to understand reasons.

If you cannot see what is staring right at you in the face then fair enough. It is your right to wait until it someone else you 'trust' calls it for you (which will then be way past the point of the info being useful) but you have the brain power I am sure to work it out for yourself if you do your own research on the housing market and how it fits into the economy.



A

I have looked at probably every bleeding house in Lancashire these past few days on RM, (at sensible prices under £210k) including all the SSTC and under offer ones. It's seems most of the "nice" ones I'd have been interested in were under offer or sstc. seems some people out there aren't that bothered about plummeting prices if the property is a bit different or nice and tidy.
It's seems the bog-standard ones that people presumed had jumped up £50k aren't moving.

I'm not that worried just yet.

quote:

Originally posted by pgui:
If you cannot see what is staring right at you in the face then fair enough. ....... do your own research on the housing market and how it fits into the economy.

Rather weak cop-out

If things were that certain then there wouldn't be a debate - would there?

Correct me if I'm wrong.
1/Buyers,including first time buyers,on the back of todays news are even more likely to hold off buying,thus causing sellers to reduce prices even more to sell?
2/Less first time buyers due to banks cutting number of mortgages available,100% mortgages scraped,plus banks more choosey who they lend to
leading to sellers reducing prices?
3/In all,this is a good time to sell
and rent then buy,or if you are
a first timer then don't buy for at least 6 months.Correct?

wrong

Sorry Malkie, but I don't see his words as hypocracy. Was he not stating figures as written in a Halifax report, but then mentioning that they were spinning based on other factors to make the future sound better?

I’m really enjoying reading Malkie posts

What I would like to know about the ‘Property Prices and credit crunch’ is at what point will people like Pflusk, Splendiferous, pgui, reverand, Gimmemoney decide its time to buy a property? I am interested, please tell us what percentage fall you would buy in at?

My own personal view is that house prices may fall around 10% this year, but its impossible to know what will happen after that. It would be sad if you missed the boat (again) and spent the next five years looking back, if it turns out to be a house price 'blib' as opposed to House Price Crash.

Regards

My own personal view is that house prices may fall around 10% this year, but its impossible to know what will happen after that.

Agreed. People are too eager to make predictions. The best ones only cover a short amount of time.

I bought a few years ago and live in my house as a home. I'm just a voyour on the subject & find it fastinating. I am astounded that its kept on going up and up and up these past few years. I truely beleived it inevitble it was all going to come crashing back down and some point.
My fear was for young people I know jumping in regardless and getting badly burnt. Sadly it will happen to quite a number.

I would'nt like to put a number on the actual percentage drop. As I said some banks are giving better rates with a 25% deposit, I guess thats a good indication of what they are expecting.

Watching the news last night was pretty grim viewing. I cannot see it taking a gentle slop downwards but a sudden drop.

Still I have been wrong before.

I'll go with 25% by the end of this year.

Petrol price crash - that's the one I'm rooting for.

How can property prices actually crash not just stop rising so fast? As I was young around the time of the last one and not at all interested in this sort of thing then, can someone explain how... well how people let it happen?

Surely that many people don't HAVE to sell in times of downturns? A lot of people move for almost pleasure, for a house they find that they like but don't NEEEED to move. How does it come about that suddenly loads of people have no choice but to accept 30% less for their property? I wouldn't. I'd want what I paid for it at least. Otherwise I'd sit tight. Doesn't everybody. Do that many people need to accept 30% less that it becomes the norm and therefore a crash?

Who decides? Is it all caused by scaremongering and buyers getting worried as a result? What if everyone just sat tight for a year or two? What would the banks do if everyone said, fine if you won't give us mortgages you won't get any business? We'll all rent.
Is the crash everywhere or do affordable pockets escape? Is the crash uniform or at different drops around the country?

Surely a sensible thing to happen would be everywhere stays largely the same but London etc. gets off it's pedestal and comes back to earth with it's prices?

And malkie - I found your last post extremely informative, even if you did ramble a bit

I believe the formula to the potential drop in prices is:
No more cheap loans = people cannot buy the houses = no mortgage equity withdrawal as price are not going up anymore = no money to spend = nobody shopping = jobs cut in retail = more people have less money = even less spending = other jobs going = unemployment up and so on in a self feeding way.
HC I think you are right in that people will hold on with a grip of steel. It has been noticed that in previous periods of falling prices this is the case and that it is usually a slow move down. When people argue with their percentage figures over so many years they normally scare people with falls taking into acount inflation. However, in the past falls of nominal prices have been quite small because of this holding on factor. It will only be if the unemployment starts to rise that people will start selling for less and start getting repo'd.

quote:

No more cheap loans = people cannot buy the houses = no mortgage equity withdrawal as price are not going up anymore = no money to spend = nobody shopping = jobs cut in retail = more people have less money = even less spending = other jobs going = unemployment up and so on in a self feeding way.

And while this is all going on, does the government not have the power to cap the profits of certain companies, ie. utility, petrol at a respectable level not the actual absolutely disgusting figures that they are now? Therefore lowering prices of necessities etc. to free up a little money for families etc. so we don't go into a full blown recession?

I presume this is what happens?

Surely one of the main factors for the last house price crash was the interest rates? in 1990 the rates were 15% - and had previously for a short time been 16%. I can remember friends of mine were living in a flat which became more unaffordable literally by the month. In that situation some people may have no choice but to sell.

I presume the government can go in pretty much whichever way it likes to, within reason and as long as it does not affect their chances of being voted in again. It will be interesting to see what plans, schemes, rescue packages they come up with if needed.

Are the interest rates likely to get up there again?
Why were they so high back then? And did they drop in relation to the price crash or different factors?
Because if they drop to try to stabilise a crash, if we're nearly in a crash now apparently, they won't be dropping the interest rates at all will they? So will we have to see interest rate rises shoot up to 16% and then see them drop or this time will they be nothing to do with it?

for some reason I appear to have become actually interested in all this, instead of pretending I know what it all means.

quote:

It will be interesting to see what plans, schemes, rescue packages they come up with if needed.

I'm guessing it will be more painful and exasperating rather than interesting. But hey, if he puts the energy companies in their place I'll back Gordy all the way

quote:

Originally posted by holy cheeses:
Are the interest rates likely to get up there again?
Why were they so high back then? And did they drop in relation to the price crash or different factors?
Because if they drop to try to stabilise a crash, if we're nearly in a crash now apparently, they won't be dropping the interest rates at all will they? So will we have to see interest rate rises shoot up to 16% and then see them drop or this time will they be nothing to do with it?

for some reason I appear to have become actually interested in all this, instead of pretending I know what it all means.

I don't believe we will see interest rates of 16% again in the near future. I suppose it was like a doubling of your mortgage back then
However prices are much higher now and if lenders are not lending near to the BOE rate and worse if you have no equity, then for those on the edge it almost amounts to the same thing.
I seem to remember that 16% only lasted a little while (few days?) and they lowered them as the recession set in, to stimulate business / the housing market.
At the moment they (media) seem to be suggesting that there is room to lower the interest rates now.

Interest rates were high in the lates 80's early 90's but the debt was a lot lower. Houses were around 1/3 of what they are now, so in reality 5% interest rates and house prices as they are now, means we are in the same situation as back then!

quote:

At the moment they (media) seem to be suggesting that there is room to lower the interest rates now.

I did actually baulk at my mum telling me her 7.49% rate or something and nearly spat my coffee out. She's so desperate to get this 100% mortgage of hers she has taken whatever she could get.
Lowering the interest rate to stimulate the housing market - how will that work this time if we are in a crash now and they aren't particularly high? They can't raise them anymore yet can they with the prospect of a crash there looming already. So they can't raise a lot, can't really lower it a lot. What's going to stimulate it then, if people like myself sit tight to avoid selling at a loss?
Won't it become a big tug of war? Do people resist paying more for property when the upturn starts then give up and know they're going to have to pay top whack again?

How does the crash stop?

I have now completely confused myself!

Why did the property market boom up so much this time since the last crash?

If people were being made to pay jumped up prices in such a short time, why did everybody buy? Why didn't they do what is happening now and become more objective about the actual prices they were being asked to pay. How did the prices jump so high above wages without people saying enough was enough long before now?

16% didn't last long, but 14 and 15 were around for a while. Wasn't this somehow tied in to the ERM which Britain was trying to adhere to? I am sure one of the economics experts on here can remind us.

I bought in 1991 and cannot for the life of me remember what the interest rate was then. My tiny one-bed flat was 4x my salary (but I had a large deposit). When we bought our house in 1994, I remember the rate was 6% which we thought was such a great deal in view of previous horrors, that we fixed it for five years. Of course by the time the rate ended we were overpaying massively because it had gone down to 4% For anyone who thinks house prices in those days were a picnic, they certainly were not for us, we were really skint for a good few years.

quote:

At the moment they (media) seem to be suggesting that there is room to lower the interest rates now.

The BOE set interest rates around the rate of inflation and that is the one and only goal they are interested in. Its got nothing to do with the housing market. Period.

has the rate of inflation got anything to do with housing?