Will Coronavirus hit used car prices?
Discussion
GT72 said:
That may be the case, but those that do survive will do so through massive cuts. Knight Frank lost around half their resi staff in the 2008 recession. Savills, Countrywide, JLL and CBRE are already looking at staffing levels across the board and we've not even got to the latest recession yet.
As I say, I believe the housing market will stall, do you disagree, if so, I'd love to know why?
There is a housing shortage and interest rates are virtually zero. If you have money, there is no safer place to put than in property. As I say, I believe the housing market will stall, do you disagree, if so, I'd love to know why?
Obviously everything slows during a recession, but house prices won’t fall like used car prices will.
Car is a depreciating financial liability no matter how much we love them. A house is a appreciating asset.
Funny how everyone is touting huge losses but all we've seen evidence is a Golf R that's lost 1k in a month in natural depreciation, another Golf R that is cheap but likely to be CAT C and a Mustang with the usual discounting to get it out the door.
I'm not denying there will be changes but some people think it's already happened when it's not.
I'm not denying there will be changes but some people think it's already happened when it's not.
Kev78 said:
GT72 said:
That may be the case, but those that do survive will do so through massive cuts. Knight Frank lost around half their resi staff in the 2008 recession. Savills, Countrywide, JLL and CBRE are already looking at staffing levels across the board and we've not even got to the latest recession yet.
As I say, I believe the housing market will stall, do you disagree, if so, I'd love to know why?
There is a housing shortage and interest rates are virtually zero. If you have money, there is no safer place to put than in property. As I say, I believe the housing market will stall, do you disagree, if so, I'd love to know why?
Obviously everything slows during a recession, but house prices won’t fall like used car prices will.
Car is a depreciating financial liability no matter how much we love them. A house is a appreciating asset.
Edit. If inflation really kicks off, as it surely will with all this stimulus, we could see house prices rising. Will still be a depreciating asset however.
Edited by Unsorted on Friday 3rd April 01:40
GT72 said:
I don't think the commercial side will be pummelled. Business Rates teams have never been busier, asset management teams have never been busier, industrial agency teams have never been busier, valuation teams will continue to make money as following the last recession banks are required to re-value properties every 24 months. Regulated Purpose Valuations will move from quarterly to monthly and in some cases weekly, increasing fees. Brexit stalled the investment market with numerous UK and European funds holding significant cash reserves. Those funds are likely to re-enter the market, so whilst investment transactions will be at a lower level, they will occur. There will be a drop in values, but it's very very unlikely the commercial market will suffer to the same degree as residential. There will be an adjustment in the retail and leisure markets, but that was already happening before Covid-19, it's just accelerating it. The shopping centre market has been like a car crash in slow motion for the last 12 months.
The residential market will suffer far worse and certainly within those firms mentioned it is the residential divisions that are being focused upon.
Retail aside, that’s almost the exact opposite to what others have been telling me, with most citing social changes as a result of covid. They’ve been broadly consistent with this recent piece: https://www.coutts.com/insight-articles/news/2020/...The residential market will suffer far worse and certainly within those firms mentioned it is the residential divisions that are being focused upon.
Logic seems to be that retail is screwed, companies will rethink the need for office space, people still want/need somewhere to live. demand affecting values accordingly. Of course it depends to a degree how much financial pain is inflicted by CV, whether the lending market dries up, what happens to LTVs especially for resi (both for movers and those coming to the end of fixes).
Aaa. said:
Funny how everyone is touting huge losses but all we've seen evidence is a Golf R that's lost 1k in a month in natural depreciation, another Golf R that is cheap but likely to be CAT C and a Mustang with the usual discounting to get it out the door.
I'm not denying there will be changesp
but some people think it's already happened when it's not.
Totally, it’ll be several months before we see the impact. There’s such uncertainty in the jobs market that the only people buying cars at the moment will be those who absolutely have to. They’ll likely have to pay current market rate. I'm not denying there will be changesp
but some people think it's already happened when it's not.
It’s only when those people who’ve lost their jobs or taken pay cuts start buying and selling that the market will find it’s level.
Aaa. said:
Funny how everyone is touting huge losses but all we've seen evidence is a Golf R that's lost 1k in a month in natural depreciation, another Golf R that is cheap but likely to be CAT C and a Mustang with the usual discounting to get it out the door.
I'm not denying there will be changes but some people think it's already happened when it's not.
Yeah it’s not gonna happen yet, I think some were expecting it to happen overnight! As I said previous we are looking at 3-4 month before we see anything realistic and even then possibly into autumnI'm not denying there will be changes but some people think it's already happened when it's not.
Part of the fun is we all make different bets on what cars and property is going to do
I’ll sell to people that think houses will rise
I’ll buy off people that need to get rid
I personally think a big fall is coming BUT it’s gonna take 6 months post corona for people to realise their home hasn’t sold and to reduce prices
After lockdown people will advertise at pre corona prices thinking they will chance their arm
There will be a huge lag until reality sets in
I’ll sell to people that think houses will rise
I’ll buy off people that need to get rid
I personally think a big fall is coming BUT it’s gonna take 6 months post corona for people to realise their home hasn’t sold and to reduce prices
After lockdown people will advertise at pre corona prices thinking they will chance their arm
There will be a huge lag until reality sets in
hungry_hog said:
Might be quite tricky to sell that house in Kensington Palace Gardens and the Mac F1 if people aren't able to see them in person!
I suspect many (?) car sales at the F1 price level are not done in person anyway, but through agents plus reports from experts (mclaren factory or lanzante for an F1, for example, DKENG maybe for ferrari? etc)Aaa. said:
Funny how everyone is touting huge losses but all we've seen evidence is a Golf R that's lost 1k in a month in natural depreciation, another Golf R that is cheap but likely to be CAT C and a Mustang with the usual discounting to get it out the door.
I'm not denying there will be changes but some people think it's already happened when it's not.
Who's mentioned CAT C on the car? The lad has lost his job, owes a bit under 8k on a loan. No means of paying it off unless the car goes. Simple. I'm not denying there will be changes but some people think it's already happened when it's not.
MDMA . said:
Aaa. said:
Funny how everyone is touting huge losses but all we've seen evidence is a Golf R that's lost 1k in a month in natural depreciation, another Golf R that is cheap but likely to be CAT C and a Mustang with the usual discounting to get it out the door.
I'm not denying there will be changes but some people think it's already happened when it's not.
Who's mentioned CAT C on the car? The lad has lost his job, owes a bit under 8k on a loan. No means of paying it off unless the car goes. Simple. I'm not denying there will be changes but some people think it's already happened when it's not.
I suspect that if you had to turn your car into cash tomorrow, you'd be lucky to get 70% of what you would have got last month.
EA's will go under.
There'll be a bounce of houses coming onto the market (rampant diy/planning for the future as youve nothing better to do at home/don't want to continue living in what has become a home prison)
But who can survive 3months of no cash flow, then at least two months before sales commission start coming through into your bank from sellers?
Plus people pulling out of confirmed sales.
Buyers will want bargains?
We've never been here before and the same with cars. Both have never been such high ticket items in history where people overcommit to both.
It'll be interesting to see what we all say on this topic in April 2021.
There'll be a bounce of houses coming onto the market (rampant diy/planning for the future as youve nothing better to do at home/don't want to continue living in what has become a home prison)
But who can survive 3months of no cash flow, then at least two months before sales commission start coming through into your bank from sellers?
Plus people pulling out of confirmed sales.
Buyers will want bargains?
We've never been here before and the same with cars. Both have never been such high ticket items in history where people overcommit to both.
It'll be interesting to see what we all say on this topic in April 2021.
GT72 said:
I don't think the commercial side will be pummelled. Business Rates teams have never been busier, asset management teams have never been busier, industrial agency teams have never been busier, valuation teams will continue to make money as following the last recession banks are required to re-value properties every 24 months. Regulated Purpose Valuations will move from quarterly to monthly and in some cases weekly, increasing fees. Brexit stalled the investment market with numerous UK and European funds holding significant cash reserves. Those funds are likely to re-enter the market, so whilst investment transactions will be at a lower level, they will occur. There will be a drop in values, but it's very very unlikely the commercial market will suffer to the same degree as residential. There will be an adjustment in the retail and leisure markets, but that was already happening before Covid-19, it's just accelerating it. The shopping centre market has been like a car crash in slow motion for the last 12 months.
The residential market will suffer far worse and certainly within those firms mentioned it is the residential divisions that are being focused upon.
North West residential agents will suffer the same as everyone else. If the market is stalled there will be no fees, some may have bigger cash reserves than others but they'll still suffer.
Which North West firms do you think will remain profitable?
Plus what if there is zero demand as customers are decimated?
Sa Calobra said:
EA's will go under.
There'll be a bounce of houses coming onto the market (rampant diy/planning for the future as youve nothing better to do at home/don't want to continue living in what has become a home prison)
But who can survive 3months of no cash flow, then at least two months before sales commission start coming through into your bank from sellers?
Plus people pulling out of confirmed sales.
Buyers will want bargains?
We've never been here before and the same with cars. Both have never been such high ticket items in history where people overcommit to both.
It'll be interesting to see what we all say on this topic in April 2021.
How do you define a bargain? Will a cash car buyer see a 30% drop in the price of the car they want as a 'bargain' if their income/car savings pot has been depleted by 30% or more because they need the funds elsewhere? It would make the prospective purchase more expensive in real terms. Same goes for those financing cars from income - any 'bargain' PCP/HP deal is going to be priced relative to their new income levels.There'll be a bounce of houses coming onto the market (rampant diy/planning for the future as youve nothing better to do at home/don't want to continue living in what has become a home prison)
But who can survive 3months of no cash flow, then at least two months before sales commission start coming through into your bank from sellers?
Plus people pulling out of confirmed sales.
Buyers will want bargains?
We've never been here before and the same with cars. Both have never been such high ticket items in history where people overcommit to both.
It'll be interesting to see what we all say on this topic in April 2021.
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