How far will house prices fall [volume 5]
Discussion
s1962a said:
You certainly have done your homework. For around that price range I would have suggested Crystal Palace/Norwood but you are underwhelmed by them - i dont blame you. It's green, close to Dulwich, but a lot of riff raff around. Saying that, it's a 30 min cab ride home at night from the city and approx 50 min commute during the day (including the bus to the station) so you still feel like you're living in London. Good luck!
Unfortunately, not many 4 bed detached houses around, unless you move further out to the commuter belt.
We have definitely tested what we really wanted, certainly saved some ££ in making mistakes knowing what we wanted and losing out on stamp/legals e.t.c. Now we know, it comes down to whether we are aware of all "interesting" areas.Unfortunately, not many 4 bed detached houses around, unless you move further out to the commuter belt.
We had made an offer on a 3 floor semi in West Norwood/Crystal palace (as like you mention it has quite a bit going for it, but also alot of riff raff/only smaller pockets of "nice") but they turned it down (still not sold after 7-8 months) and I haven't thought about it for a while which is probably a sign it wasn't meant to be!. Ha, just noticed they have moved it from a guide to a fixed price at £100k more - never in a million years will they get that, absolute fantasy land.
It had a large garden/potential but it still didn't excite in the same way as the other options (particularly as the best station into work was Norwood Junction which has been trying to regenerate for many years.....) and you have to walk past a raft of charity/chicken/fast food shops which are all quite shabby. Which in itself is a very first world problem, but add in the factor of future children e.t.c, much less desirable.
Edited by V6Alfisti on Monday 23 March 16:47
V6Alfisti said:
s1962a said:
You certainly have done your homework. For around that price range I would have suggested Crystal Palace/Norwood but you are underwhelmed by them - i dont blame you. It's green, close to Dulwich, but a lot of riff raff around. Saying that, it's a 30 min cab ride home at night from the city and approx 50 min commute during the day (including the bus to the station) so you still feel like you're living in London. Good luck!
Unfortunately, not many 4 bed detached houses around, unless you move further out to the commuter belt.
We have definitely tested what we really wanted, certainly saved some ££ in making mistakes knowing what we wanted and losing out on stamp/legals e.t.c. Now we know, it comes down to whether we are aware of all "interesting" areas.Unfortunately, not many 4 bed detached houses around, unless you move further out to the commuter belt.
We had made an offer on a 3 floor semi in West Norwood/Crystal palace (as like you mention it has quite a bit going for it, but also alot of riff raff/only smaller pockets of "nice") but they turned it down (still not sold after 7-8 months) and I haven't thought about it for a while which is probably a sign it wasn't meant to be!. Ha, just noticed they have moved it from a guide to a fixed price at £100k more - never in a million years will they get that, absolute fantasy land.
It had a large garden/potential but it still didn't excite in the same way as the other options (particularly as the best station into work was Norwood Junction which has been trying to regenerate for many years.....) and you have to walk past a raft of charity/chicken/fast food shops which are all quite shabby. Which in itself is a very first world problem, but add in the factor of future children e.t.c, much less desirable.
Edited by V6Alfisti on Monday 23 March 16:47
s1962a said:
You, sir, are Dulwich material
I knew that would "excite" 
I was being polite, as that area can be "exciting" for crime/issues e.t.c, thus clearly not a great base for a child to commute through/from if avoidable. "Posh" bits of London can be bad in this regard as well, but why take the increased risk if you can avoid it.
Edited by V6Alfisti on Monday 23 March 17:00
okgo said:
Unless you have 5x the money you're talking about, you're going to be within close prox of riff raff or whatever you call it in any of the places you mention, including Coulsdon etc.
There is a vast difference in reputation/issues between Norwood Junction and places like Beckenham/Coulsdon in the main.If you re-read, the issue with Norwood is Norwood Junction rather than the entirety of the area, however it is one I would need twice daily. If you know the area, you will understand, if you don't then I can see why you are becoming defensive and assuming I am expecting a street with trees and birds singing a tune.
Norwood South which that Junction sits in, is one of the top 5 most dangerous areas to live in Croydon, whilst Coulsdon is in the bottom three.
Edited by V6Alfisti on Monday 23 March 17:49
skwdenyer said:
rm163603 said:
There's so many moving parts in all of this it's impossible to predict.
Low interest rates and high inflation isn't something that's really occurred before. Normally high inflation leads the government to increase rates but I can't see that this time.
Plus there is the fact that property has utility so isn't the worst place to tie up any cash. It will always have a value.
I don’t think we were taking about tying up cash. Most home-buyers are buying with credit. If wages drop 20% (quite possible) and jobs are fewer then how are these houses to be bought?Low interest rates and high inflation isn't something that's really occurred before. Normally high inflation leads the government to increase rates but I can't see that this time.
Plus there is the fact that property has utility so isn't the worst place to tie up any cash. It will always have a value.
So ~ 20% wage drop vs mortgage costs isn’t a huge gap.
All people have to do is drive a used car rather than renting new and they’ll have loads of free cash for a house.
Mr Whippy said:
Interest rates just dropped loads.
So ~ 20% wage drop vs mortgage costs isn’t a huge gap.
All people have to do is drive a used car rather than renting new and they’ll have loads of free cash for a house.
20% wage drop accounted for by savings on interest rates?So ~ 20% wage drop vs mortgage costs isn’t a huge gap.
All people have to do is drive a used car rather than renting new and they’ll have loads of free cash for a house.
A london centric view (sorry not sorry)
The base rate has dropped 0.65% which is say £1500 on a £400,000 mortgage, vs say a salary of £90k which is probably needed to get that level of mortgage (assuming a deposit exists).
So thats £1500 saving on interest vs £18k (although probably closer to £11k after tax) loss in salary
What do those who are in a fixed contract for car rental do?
What do those who don't have a car (e.g lots of Londoners don't).
What do those do, that have zero savings or less than £5/10k
What do those do who are endebted up to the hilt?
I understand the idea that every little helps, but I suspect in that case....it's not enough at a time where house prices are 14x the average wage in London and 8x in the rest of the UK.
Even those on £100k plus in London, once tax is taken that income vs the cost of housing is still wildly out of step and people were and probably still are pushing the "limits" to get onto the ladder.
Edited by V6Alfisti on Monday 23 March 18:16
V6Alfisti said:
There is a vast difference in reputation/issues between Norwood Junction and places like Beckenham/Coulsdon in the main.
If you re-read, the issue with Norwood is Norwood Junction rather than the entirety of the area, however it is one I would need twice daily. If you know the area, you will understand, if you don't then I can see why you are becoming defensive and assuming I am expecting a street with trees and birds singing a tune.
Norwood South which that Junction sits in, is one of the top 5 most dangerous areas to live in Croydon, whilst Coulsdon is in the bottom three.
There is, but you'll find a raft of If you re-read, the issue with Norwood is Norwood Junction rather than the entirety of the area, however it is one I would need twice daily. If you know the area, you will understand, if you don't then I can see why you are becoming defensive and assuming I am expecting a street with trees and birds singing a tune.
Norwood South which that Junction sits in, is one of the top 5 most dangerous areas to live in Croydon, whilst Coulsdon is in the bottom three.
Edited by V6Alfisti on Monday 23 March 17:49
s down in Coulsdon, a different kind of person probably to the other places, but still not great.I know the area, I live in SW2 - you can find what you're looking for I should think, even around this postcode you can find the odd very large house in a nice road for around your budget, maybe a bit more, but yes, the stations generally are going to be surrounded by crap, which is true of almost any station in South London, tbh. Apart from the one on College Road.
okgo said:
There is, but you'll find a raft of s down in Coulsdon, a different kind of person probably to the other places, but still not great.
I know the area, I live in SW2 - you can find what you're looking for I should think, even around this postcode you can find the odd very large house in a nice road for around your budget, maybe a bit more, but yes, the stations generally are going to be surrounded by crap, which is true of almost any station in South London, tbh. Apart from the one on College Road.
Oh yep totally, it is a different kind . Even in the "Posh" bits of London, people are getting mugged and stabbed...no area is immune, but there is a difference of chosing to walk through the roughest parts of an area by choice on a daily basis. That's not something I would feel happy about current/future family doing, too many worries in the world to chose to add an extra one with a much higher change of something happening.s down in Coulsdon, a different kind of person probably to the other places, but still not great.I know the area, I live in SW2 - you can find what you're looking for I should think, even around this postcode you can find the odd very large house in a nice road for around your budget, maybe a bit more, but yes, the stations generally are going to be surrounded by crap, which is true of almost any station in South London, tbh. Apart from the one on College Road.
I have lived in lots of areas and know the difference between a bit irritating vs why would you go there if you didn't have to, vs downright dangerous.
SW2 is nice, but again doesn't often offer the basics (for us) of offstreet parking e.t.c so that's why it's been ruled out. We did the whole search around Dulwich but 1m there gets you a small terrace with cramped onstreet parking, if I was to do that I would just buy a largeish 3 bed flat in zone 2 London with largely the same restrictions.
V6Alfisti said:
Mr Whippy said:
Interest rates just dropped loads.
So ~ 20% wage drop vs mortgage costs isn’t a huge gap.
All people have to do is drive a used car rather than renting new and they’ll have loads of free cash for a house.
20% wage drop accounted for by savings on interest rates?So ~ 20% wage drop vs mortgage costs isn’t a huge gap.
All people have to do is drive a used car rather than renting new and they’ll have loads of free cash for a house.
A london centric view (sorry not sorry)
The base rate has dropped 0.65% which is say £1500 on a £400,000 mortgage, vs say a salary of £90k which is probably needed to get that level of mortgage (assuming a deposit exists).
So thats £1500 saving on interest vs £18k (although probably closer to £11k after tax) loss in salary
What do those who are in a fixed contract for car rental do?
What do those who don't have a car (e.g lots of Londoners don't).
What do those do, that have zero savings or less than £5/10k
What do those do who are endebted up to the hilt?
I understand the idea that every little helps, but I suspect in that case....it's not enough at a time where house prices are 14x the average wage in London and 8x in the rest of the UK.
Even those on £100k plus in London, once tax is taken that income vs the cost of housing is still wildly out of step and people were and probably still are pushing the "limits" to get onto the ladder.
Edited by V6Alfisti on Monday 23 March 18:16
In 07/08/09 people just sat and didn’t move until ‘prices’ went back to where they were.
So the market mostly freezes.
But as said, that’s ‘prices’
Values will be dropping against those who can secure inflation busting salary or income increases due to inflation.
Inflation will be hot with all the money printing.
Weird times ahead. But no need to be worried about housing unless you buy a dog in a s
t area (so most new builds 
)I moved house several months ago, despite an inevitable coming drop in prices I'm pleased I got it done before all this st kicked off. It's a purchase for the longer term so from a self interest perspective as long as I can stay in work over this period of crisis/recession, all will be well, interest rates will be on the deck for the foreseeable future.
The impending recession will obviously be deflationary to asset prices, but it will be interesting to see how this is balanced will all the QE/money printing that will have to happen to fund government spending. I think a high inflation period following the corona crisis will be somewhat needed to erode debt in real terms, plus a load of write-offs across the board...
t kicked off. It's a purchase for the longer term so from a self interest perspective as long as I can stay in work over this period of crisis/recession, all will be well, interest rates will be on the deck for the foreseeable future.The impending recession will obviously be deflationary to asset prices, but it will be interesting to see how this is balanced will all the QE/money printing that will have to happen to fund government spending. I think a high inflation period following the corona crisis will be somewhat needed to erode debt in real terms, plus a load of write-offs across the board...
156651 said:
How will we end up with 25-30% unemployment when the Government is underwriting wages?
having lived through 5 crashes, i think it would be naive to suggest that things will be back to the races in short order. have a peek at what property/mortgage funds are currently doing and maybe (although not directly connected) the stress levels in the commercial property market.i would point out that unemployment does not necessarily surge until 3 years after the initial crash has occurred. There is a possibility, that peak unemployment won't appear until 2023.
Carl_Manchester said:
having lived through 5 crashes, i think it would be naive to suggest that things will be back to the races in short order. have a peek at what property/mortgage funds are currently doing and maybe (although not directly connected) the stress levels in the commercial property market.
You may be mistaking cause & effect...the property funds are gated because investors want to leave, and would be forced sellers into a bare market if not gated. Whether the underlying properties has fallen is an interesting question. Definitely retail, but other asset classes will be in demand as investors seek real assets in a world of QE.
Mr Whippy said:
Well then market forces move the prices paid.
In 07/08/09 people just sat and didn’t move until ‘prices’ went back to where they were.
So the market mostly freezes.
But as said, that’s ‘prices’
Values will be dropping against those who can secure inflation busting salary or income increases due to inflation.
Inflation will be hot with all the money printing.
Weird times ahead. But no need to be worried about housing unless you buy a dog in a st area (so most new builds )
Exactly, market forces and definitely weird times. No-one really knows what will happen, but I do think times are quite different now to how they were.In 07/08/09 people just sat and didn’t move until ‘prices’ went back to where they were.
So the market mostly freezes.
But as said, that’s ‘prices’
Values will be dropping against those who can secure inflation busting salary or income increases due to inflation.
Inflation will be hot with all the money printing.
Weird times ahead. But no need to be worried about housing unless you buy a dog in a s
t area (so most new builds )Interest rates were slashed to try and prop up the housing market, along with HTB later e.t.c, they have slashed this time but only by 0.65% because the interest rates never really recovered from the last "challenging" period.
There was also a different local demand from BTL (now the "independents" are quickly falling away, and seemingly investment from abroad will likely be less of a factor now given the additional stamp duty, global crisis e.t.c. Let's not forget Brexit as well.
Add into this people not paying rentals/defaulting due to the current situation, one of my develop friends has been informed by all of his commercial tenants they cannot pay the rent (apart from one on a decent spot in a popular London highstreet) and his residential property is also facing similar response from people (this one surprised me more, as his residential property is normally at the higher end - possibly contractors e.t.c)
Thus a couple of the levers were already in place and were already becoming less effectual because of salary multiples/affordability - even with the props (i.e house prices and volumes were dropping in a number of London areas already and not by triffling amounts)
Regardless of people staying put, there are always drivers in the market that continue, resulting from Death and Divorce. Which in the current climate, cannot be ignored unfortunately
Having said all that, who truly knows but there are probably more warning signs now than even in the last crisis.
Moving house is on hold now as banks aren't lending apparently, Gove says don't exchange contracts.
https://www.dailymail.co.uk/news/article-8150357/C...
https://www.dailymail.co.uk/news/article-8150357/C...
MX6 said:
Moving house is on hold now as banks aren't lending apparently, Gove says don't exchange contracts.
https://www.dailymail.co.uk/news/article-8150357/C...
Apparently still ok for me to move next friday... Exchange/complete same day.https://www.dailymail.co.uk/news/article-8150357/C...
princeperch said:
okgo said:
Apparently still ok for me to move next friday... Exchange/complete same day.
Exchange/complete same day- is it a cash transaction?p1stonhead said:
Exchange and complete same day is a terrible idea IMO. So much risk that you have your whole life packed into boxes and then the whole thing falls through.
It's what is being recommended across the board by agents and solicitors, but yes, there is certainly risk...Not a cash buy no, mortgages have been in place for some time.
Gassing Station | News, Politics & Economics | Top of Page | What's New | My Stuff