How far will house prices fall [volume 4]
Discussion
Rovinghawk said:
Sheepshanks said:
Cars aren't in limited supply.
E-type Jaguars are. If one isn't being used then I think it should be given to someone like me who would use it. By your logic this is reasonable.A more relevant argument might be that Buckingham Palace should be given over to the people.
Sheepshanks said:
An E-type Jaguar isn't 'cars' - it's a particular car.
A more relevant argument might be that Buckingham Palace should be given over to the people.
E-type or Buck House- the argument that either should be taken from its owner to be given to others is bA more relevant argument might be that Buckingham Palace should be given over to the people.
ks. That was my whole point.Rovinghawk said:
Exaggerating to make the point, if they can't afford £200k @ 3%, how will they afford £100k @ 6%?
The gap between interest only and repayment mortgages closes as rates rise. Based on a 25 year term:- £200K @ 3% costs £957 per month.
- £100K @ 6% costs £652 per month.
And, as xymph pointed out, the amount of deposit required would be significantly less.
Graemsay said:
In both cases the interest only payment would be £500 per month.
So if they can't afford the first, how can they afford the second?Graemsay said:
And, as xymph pointed out, the amount of deposit required would be significantly less.
Whilst true, the price reduction I indicated was a wild exaggeration over what figures are likely.anonymous said:
[redacted]
It makes no difference. It's one house one family no matter how often people move. Imagine you have 100 properties and 101 families. No matter how often people move, or what ever way you finance each family you will always end up with 1 family not in a property.If say 50 people put their house on the market they will increase the churn, however they equally increased the number of people looking for property.
Who owns the property doesn't really change things.
Rovinghawk said:
anonymous said:
[redacted]
If people are staying put then surely demand is down as well as supply?Both supply and demand are up in equal measure.
Edited by 98elise on Sunday 25th June 19:59
Rovinghawk said:
I remember struggling with my first deposit. I had to economise & do without many little luxuries. I see many youngsters unwilling to do this.
Maybe that's because they're less driven to buy in the first place & the goal it is much further away?As someone who rents right now, I have little intention of buying a house because I don't want to make 1-2 years of daily sacrifice of life's luxuries in order to save the deposit for a house I don't even like that much.
A 50% drop in prices is unrealistic, but it would suddenly make a big difference in my interest in buying. Until then I find it an unappealing prospect and it only crosses my mind because it's "what you're supposed to do" in life and because it's sensible financially.
But then I appreciate that I must be unusual as most people seem to feel a sense of insecurity if they don't own their home, based on the fact that they always say how nice it is when they finally buy, "nobody can take it away from them". (Except the bank if you don't pay...)
I've never felt any lack of security in rented accommodation and never had to leave a property except by my own choice!
Rovinghawk said:
Foreign investors might keep the place empty- LLs put people in the houses as soon as they are refurbed.
BTLs do not reduce the amount of housing available- if anything, we improve housing stock.
Speaking from experience of renting in the past and currently knowing lots of landlords, I would disagree with that, BTLs do not reduce the amount of housing available- if anything, we improve housing stock.
LL's are a business and so have to weigh up cost-benefit in a non-emotional manner, many buy and fit the cheapest item that does the job.
Rovinghawk said:
anonymous said:
[redacted]
I remember struggling with my first deposit. I had to economise & do without many little luxuries. I see many youngsters unwilling to do this.
You have to also bear in mind that society has sold a lifestyle to the elements of youngsters you talk about and they have swallowed it hook line and sinker. Those who don't know better/have a lack of good parenting genuinely don't know better, and the penny only starts to drop when they get to the its time to have kids stage.
Edited by hyphen on Monday 26th June 07:13
98elise said:
It makes no difference. It's one house one family no matter how often people move. Imagine you have 100 properties and 101 families. No matter how often people move, or what ever way you finance each family you will always end up with 1 family not in a property.
If say 50 people put their house on the market they will increase the churn, however they equally increased the number of people looking for property.
Who owns the property doesn't really change things.
Yes it does. If say 50 people put their house on the market they will increase the churn, however they equally increased the number of people looking for property.
Who owns the property doesn't really change things.
There is a lack of family homes in many areas, and in the same areas Landlords for decades have been renting by room/make it a student house with the living room becoming an additional bedroom /split into multiple units as it is more profitable.
hyphen said:
Do without many little luxuries did you? well they now have to do without any luxuries
You have to also bear in mind that society has sold a lifestyle to the elements of youngsters you talk about and they have swallowed it hook line and sinker. Those who don't know better/have a lack of good parenting genuinely don't know better, and the penny only starts to drop when they get to the its time to have kids stage.
When my wife and I wanted our first home to get together the deposit we had no luxuries at all. I worked as a mechanic she worked in a council office. Everyone else we knew was in the same boat, doing without holidays fancy meals out using public transport to work for her.You have to also bear in mind that society has sold a lifestyle to the elements of youngsters you talk about and they have swallowed it hook line and sinker. Those who don't know better/have a lack of good parenting genuinely don't know better, and the penny only starts to drop when they get to the its time to have kids stage.
Edited by hyphen on Monday 26th June 07:13
Even then my wife had a conversation with some women who were saying how awful it was for the young with house prices the way they were.
We saved for two years and moved in with a bed and a sofa. It was the norm. Our honeymoon was two nights in Carlisle as the money was not there.
My niece got married, they had a new house all furnished on credit and honeymoon was the States, they still moan.
People can still get on the property ladder and do so every day, but many cannot budget, cannot do without anything and want a fully furnished show home form day one. Unless you have wealthy parents many will never have that so chose to rent
Rovinghawk said:
anonymous said:
[redacted]
Foreign investors might keep the place empty- LLs put people in the houses as soon as they are refurbed.BTLs do not reduce the amount of housing available- if anything, we improve housing stock.
hyphen said:
98elise said:
It makes no difference. It's one house one family no matter how often people move. Imagine you have 100 properties and 101 families. No matter how often people move, or what ever way you finance each family you will always end up with 1 family not in a property.
If say 50 people put their house on the market they will increase the churn, however they equally increased the number of people looking for property.
Who owns the property doesn't really change things.
Yes it does. If say 50 people put their house on the market they will increase the churn, however they equally increased the number of people looking for property.
Who owns the property doesn't really change things.
There is a lack of family homes in many areas, and in the same areas Landlords for decades have been renting by room/make it a student house with the living room becoming an additional bedroom /split into multiple units as it is more profitable.
The landlord hasn't created the student demand.
As always the issue is the total number of houses does not meet local demand, so prices rise.
anonymous said:
[redacted]
These investment properties could come back to haunt them! who will purchase them at over inflated prices when the panic sets in and all investors try to of load them? ( Labour Government or Inflation sets with high interest rates, Brexit completed Economy tanking ?) The asset bubble beast has been fed for to long now and is getting full .spaximus said:
When my wife and I wanted our first home to get together the deposit we had no luxuries at all. I worked as a mechanic she worked in a council office. Everyone else we knew was in the same boat, doing without holidays fancy meals out using public transport to work for her.
Even then my wife had a conversation with some women who were saying how awful it was for the young with house prices the way they were.
We saved for two years and moved in with a bed and a sofa. It was the norm. Our honeymoon was two nights in Carlisle as the money was not there.
My niece got married, they had a new house all furnished on credit and honeymoon was the States, they still moan.
People can still get on the property ladder and do so every day, but many cannot budget, cannot do without anything and want a fully furnished show home form day one. Unless you have wealthy parents many will never have that so chose to rent
Interesting perspective and I think your very last sentence is where I am now personally - even with the maximum mortgage I can get my hands on I still couldn't afford a property I would be excited to buy, and ownership has no particular value of its own to me, so if I'm going to be living somewhere I don't care about either way then I'd rather pay £1k deposit and circa £500pm for rent than £20k deposit plus £380pm in interest on the promise that it'll be worth more when I sell - assuming you haven't timed it badly or chosen the property poorly or been messed around by buyers for so long you get desperate etc...Even then my wife had a conversation with some women who were saying how awful it was for the young with house prices the way they were.
We saved for two years and moved in with a bed and a sofa. It was the norm. Our honeymoon was two nights in Carlisle as the money was not there.
My niece got married, they had a new house all furnished on credit and honeymoon was the States, they still moan.
People can still get on the property ladder and do so every day, but many cannot budget, cannot do without anything and want a fully furnished show home form day one. Unless you have wealthy parents many will never have that so chose to rent
98elise said:
So take one student house, change the tenants for a family, have you now housed the students and the family? Of course you haven't, both need housing yet one is in a house and one is looking for a house.
A family is much less flexible than those who rent by the room, for obvious reasons. The number of new house being created is also dwarfed by the number of flats being built.There is a reason that many councils including most of Greater London have banned the splitting of houses into flats.
Venturist said:
Interesting perspective and I think your very last sentence is where I am now personally - even with the maximum mortgage I can get my hands on I still couldn't afford a property I would be excited to buy, and ownership has no particular value of its own to me, so if I'm going to be living somewhere I don't care about either way then I'd rather pay £1k deposit and circa £500pm for rent than £20k deposit plus £380pm in interest on the promise that it'll be worth more when I sell - assuming you haven't timed it badly or chosen the property poorly or been messed around by buyers for so long you get desperate etc...
I take it you're making sure that your pension will cover the cost of renting when you retire?Gassing Station | News, Politics & Economics | Top of Page | What's New | My Stuff