Brexit - 35% House Prices Crash
Discussion
dazwalsh said:
Economic forecasters lost all their credibility when they talked about the immediate recession following a leave vote.
None of them have the balls to say “actually we havent got the foggiest idea what will happen given that its such a rare event”. None of us have any idea how brexit is going to pan out.
I reckon we will see monumental levels of panic much like the millennium bug and the country will just soldier on as if nothing has happened after we leave.
That said im a btl investor and a 30% drop in house prices would be rather nice.
Spot on.None of them have the balls to say “actually we havent got the foggiest idea what will happen given that its such a rare event”. None of us have any idea how brexit is going to pan out.
I reckon we will see monumental levels of panic much like the millennium bug and the country will just soldier on as if nothing has happened after we leave.
That said im a btl investor and a 30% drop in house prices would be rather nice.
Edited by dazwalsh on Monday 17th September 12:30
Dog Star said:
No other EU state has an NHS, and I don't see "the poor" being excluded. I'd argue that standards of healthcare are better too.
Yup and most of them spend as much, if not more, than we do on healthcare... so what's wrong with the NHS? It certainly isn't perfect, but neither is it the hugely inefficient thing compared to private systems that people would have us believe. By and large you get what you pay for with healthcare. If you plot life expectancy against health-care spending there's a few outliers (most obviously the US at the inefficient end and Cuba and the efficient end) but by and large you get out what you put in. Wholesale change is expensive by its very nature so it makes more sense to make incremental improvements to what we have than tear it up and start again with something which is no more efficient.
Edited by kambites on Monday 17th September 12:41
MaxSo said:
Iddz said:
Hi guys,
As you would have heard or seen, as its all over the news; apparently with the event of a no-brexit deal we are likely to see a 35% drop in house prices.
Would you say this is likely to happen? I am a first time buyer and have finally saved up enough deposit to buy by dream house but do not want to be stuck in negative equality.
Any information welcome.
Carney, nor anyone else of any repute, has said “we are likely to see a 35% drop”. The 35% is in relation to a worst-case stress test - a made up scenario so the BoE can model whether the banking system is robust enough to withstand a shock (whatever the origin may be). Someone in the Cabinet meeting where Carney apparently spoke of this 35% has mistakenly, or perhaps wilfully, got the wrong end of the stick. It is not a forecast or a prediction.As you would have heard or seen, as its all over the news; apparently with the event of a no-brexit deal we are likely to see a 35% drop in house prices.
Would you say this is likely to happen? I am a first time buyer and have finally saved up enough deposit to buy by dream house but do not want to be stuck in negative equality.
Any information welcome.
The engineer tells the people in charge of the bridge that it is very strong and robust - he has designed the bridge so it can even withstand many 747s!
One of the people in charge is either an idiot, or has other motivations, and decides to tell the media that the engineer said 747s are going to use the bridge as a runway.
It doesn’t mean that 747s are going to use the bridge as a runway.
Difficult one, we completed in March and I have kept an eye on the value ever since. I work within part of the industry so maybe it was closer to home when I purchased our own home.
Reality is that the sellers in all the properties we viewed were not being realistic with the values of their homes and only after protracted negotiation did they want to reduce it (and it is not as though in some circumstances they were not making enough on the sale, so it was pure greed).
Equally true is that the marketing at least in the SE is slowing dramatically, properties are coming to the market slower than ever. Some of the North West is coping better mind in terms of coming on to the market to be sold.
Reality is that the sellers in all the properties we viewed were not being realistic with the values of their homes and only after protracted negotiation did they want to reduce it (and it is not as though in some circumstances they were not making enough on the sale, so it was pure greed).
Equally true is that the marketing at least in the SE is slowing dramatically, properties are coming to the market slower than ever. Some of the North West is coping better mind in terms of coming on to the market to be sold.
Around my area - the decent houses are still selling like wildfire and the overpriced houses sit on the market and stagnate because the owners are too greedy (swap for a softer word if you like).
If you can pay the mortgage payments without stretching yourself to potential cripple yourself if the interest rate went up 2/3% (in 5 year's time), get a 5 year fixed and you're fine. Don't let a biased anti-Brexit news station stop you living your life!
If you can pay the mortgage payments without stretching yourself to potential cripple yourself if the interest rate went up 2/3% (in 5 year's time), get a 5 year fixed and you're fine. Don't let a biased anti-Brexit news station stop you living your life!
I suspect if they do slip, it'll be a regional thing, to balance up stupid house price values.
i.e the £1m ex council flat in London (which in the real world is worth £60K) might slip a little !
Back in the sensible world, I doubt much will change.
I know the tax rules on BTL's are changing: even I'm debating whether that's worth continuing with and I work in the world of housing for a living.
i.e the £1m ex council flat in London (which in the real world is worth £60K) might slip a little !
Back in the sensible world, I doubt much will change.
I know the tax rules on BTL's are changing: even I'm debating whether that's worth continuing with and I work in the world of housing for a living.
captain_cynic said:
Houses are already not selling very well, A colleague had to sell his property for £50,000 less than advertised after 10 months of advertising and 3 different agents.
Probably because your colleague overvalued his own house by £50k 10 months ago.Houses are still selling exceptionally well in Torbay, prices still getting even more crazy. But... if something is over priced it still won't sell.
As for a 35% fall, almost certainly won't happen. Someone has already said it but we all need somewhere to live and so the market will still be there. It may fall a bit but it's a sensationalist headline for sure.
I'm an ex estate agent btw
There have been threads like this for years on here.
My view is that if you find the right (i.e. long term) property and have the money then buy it. Anything can happen, or it might not. Living in your own home will undoubtedly bring you economic value in the long term and it is a much nicer place to be mentally in the short term.
My view is that if you find the right (i.e. long term) property and have the money then buy it. Anything can happen, or it might not. Living in your own home will undoubtedly bring you economic value in the long term and it is a much nicer place to be mentally in the short term.
Christmassss said:
Audemars said:
2007 financial crash did nothing to house prices.
Brexit is a much smaller phenomenon than the huge 2007 financial crash.
Brexit will do nothing once the dust has settled.
Apart from the 16.2% price drop in 2008?Brexit is a much smaller phenomenon than the huge 2007 financial crash.
Brexit will do nothing once the dust has settled.
I remember some house prices dropping a little and other basically only seeing a slow down of increase.
Enough to put a number of developers out of business who were relying on paying off large debt levels based on the future trend of properties, but other than that it resulted in interest rate drops which allowed many people to get on the mortgage ladder.
Only problem now is that too many people are living/relying on that incredibly low interest rate level.
Too many still with large debts and totally ignorant (or even arrogant) of the nature that interest rates must rise in order to give the UK some financial levers to pull to control the economy.
Rovinghawk said:
Alternatively rents will rise to offset additional costs.
I don't know what effect that will have on house prices.
Rising rent will drive renters to cheaper accommodation, thus quickening the demise of BTLer's who've over extended themselves. They're already struggling to get what they're already charging.I don't know what effect that will have on house prices.
A glut of supply will often have the effect of lowering prices as it becomes a buyers market. Saw the same thing in Australia after the GFC hit, of course it didn't hit Australia as hard as it hit the UK. The biggest problem will be getting finance as banks become ultra conservative in lending.
It won't happen.
Prices may stagnate but so much of the economy rides off the back of house prices that HMG (and the banks) will continue to prop up the market.
If prices drop many will be left in negative/ much reduced equity which means big trouble for them (no more feel good factor, so less spending) and further headaches for the banks (reduced lending and repossessions).
The market survived the meltdown in 2007/ 2008 and it will continue to do so.
If it did not then the shockwave would be felt much further afield than the housing market.
Prices may stagnate but so much of the economy rides off the back of house prices that HMG (and the banks) will continue to prop up the market.
If prices drop many will be left in negative/ much reduced equity which means big trouble for them (no more feel good factor, so less spending) and further headaches for the banks (reduced lending and repossessions).
The market survived the meltdown in 2007/ 2008 and it will continue to do so.
If it did not then the shockwave would be felt much further afield than the housing market.
donkmeister said:
A drop of that magnitude would be brilliant for many people and for many reasons but only if it isn't accompanied by a huge increase in people defaulting on mortgages as a result.
It would however upset a lot of friends and colleagues who have remortgaged to pay for holidays and toys, and also those who are mortgaged to the hilt to get the absolute maximum house they can stretch to.
Which people would it be brilliant for?It would however upset a lot of friends and colleagues who have remortgaged to pay for holidays and toys, and also those who are mortgaged to the hilt to get the absolute maximum house they can stretch to.
If you have a house you lose a ton of money.
If you have a job you might well lose it, or have your income fall or flatline.
If you have savings they'll be devalued by drops in interest rates.
Likewise if you have a pension.
S. Gonzales Esq. said:
I saw the BBC website headline about this and it's spectacularly misleading - enough to damamge my opinion of BBC News.
Read two thirds of the way down the article and it turns out that the bank modelled a range of post-Brexit scenarios, and the worst one they imagined was a 30-something percent drop in housing values. There only place implying this could ever actually happen is the headline on the article.
I wonder if they modelled a 35% rise in house prices too?
My thoughts exactly. Read two thirds of the way down the article and it turns out that the bank modelled a range of post-Brexit scenarios, and the worst one they imagined was a 30-something percent drop in housing values. There only place implying this could ever actually happen is the headline on the article.
I wonder if they modelled a 35% rise in house prices too?
As bad as the Express!
Am I the only one here who gets irritated when housing is referred to as 'stock'? If you're in the housing trade then perhaps it's correct, but in general parlance it just looks odd.
And then despite house sale transaction levels being at 30 year lows, we get the oft repeated phase "Decent stock is still selling".
And then despite house sale transaction levels being at 30 year lows, we get the oft repeated phase "Decent stock is still selling".
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