House Price Crash Coming?
Discussion
What's the consensus on house prices?
We were looking at potentially moving but if we're heading for a deep recession with 7m unemployed I can't see prices rising in the near future and if it's anything like the banking crisis we could see a bit of a crash.
We're in a 3 bed detached valued ~£215k and been looking at 4/5 beds in the same general area but they're up at ~£350k at the moment. They're selling while the SD holiday is on but once that's done and dusted I'm anticipating a huge drop in demand and possibly a drop in prices of ~15%.
Fag packet maths say presently we'd need to bridge £350-215 = £135k which seems ridiculous for a little bit of extra space when we can adequately cope where we are for now.
If the market were to drop 15% that would become £298-183 = £115k. SD of ~£5k =£120k gap to bridge.
Nobody has a crystal ball but the thought process seems sound. What do you reckon?
We were looking at potentially moving but if we're heading for a deep recession with 7m unemployed I can't see prices rising in the near future and if it's anything like the banking crisis we could see a bit of a crash.
We're in a 3 bed detached valued ~£215k and been looking at 4/5 beds in the same general area but they're up at ~£350k at the moment. They're selling while the SD holiday is on but once that's done and dusted I'm anticipating a huge drop in demand and possibly a drop in prices of ~15%.
Fag packet maths say presently we'd need to bridge £350-215 = £135k which seems ridiculous for a little bit of extra space when we can adequately cope where we are for now.
If the market were to drop 15% that would become £298-183 = £115k. SD of ~£5k =£120k gap to bridge.
Nobody has a crystal ball but the thought process seems sound. What do you reckon?
That's my thinking. The SD holiday is doing its bit and people are buying those £350k houses now to save ~£7k but it's a false economy if the arse falls out of the market in nine months' time.
I'm content with the gamble of staying put for now and saving up as much as possible in the interim.
I'm content with the gamble of staying put for now and saving up as much as possible in the interim.
craigjm said:
Sounds like someone else is suggesting the move and you’re looking for some “evidence” that you shouldn’t because you don’t want to
Actually quite the opposite. Girlfriend is very happy with the house, I would like somewhere bigger so suggested we start looking. I was a bit shocked that houses that were ~£225k five years ago have gone up 55% in that timescale.Edited by craigjm on Tuesday 11th August 17:03
We'll see what happens. If I've called it wrong then we can stay put.
sideways sid said:
Some thoughtful viewpoints already but I didn't see much on interest rates.
To the OP, during the foreseeable future, do you think interest rates are more likely to rise or fall?
If they rise (from current historic lows), that will have an immediate impact on mortgage costs, and hence affordability, reducing the amount that those buying property with a mortgage can pay for a house.
As others have said, there will be regional effects, as commuting reduces, WfH becomes more normal for more people, etc. One impact will be reducing demand (and relative prices) for homes where people need to live and increasing them where people want to live.
Obviously interest rates can't stay where they are forever. If we can save up a healthy sum over three years to negate the need for a mortgage that wouldn't be the worst idea in the world.To the OP, during the foreseeable future, do you think interest rates are more likely to rise or fall?
If they rise (from current historic lows), that will have an immediate impact on mortgage costs, and hence affordability, reducing the amount that those buying property with a mortgage can pay for a house.
As others have said, there will be regional effects, as commuting reduces, WfH becomes more normal for more people, etc. One impact will be reducing demand (and relative prices) for homes where people need to live and increasing them where people want to live.
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