Gear Head

iTrader: (2)

A lot of the companies that are going bust are the ones that worked on borrowed money. Once the banks stopped lending, it was bye bye for them.
No surprise really.

Deep Singh

It might be if we have a recovery and then another recession by that time

seriously though, I just can't see why you'd want to buy an asset that is falling in value??

I had this conversation with a close mate about 2.5 years ago when he decided to go into btl big time. He insisted he was investing with a long term horizon. Now his 7 properties are all worth less than he paid for them, and is having to pay big arrangement fees to remortage them.

Now I know he will be fine, he has a very good salary, BUT if had just waited he could have been buying these properties for MUCH less. Instead he has 7 properties he needs to maintain that have fallen in value and will not see inflation adjusted capital appreciation for years.

I don't often say this, but if he had only listened to me, he would be hoovering these properties up in a year or so time at 30-40% below what he paid for them



Wheres the sense in that?

Gear Head

iTrader: (2)

A 40% reduction? Now you're dreaming!

cookstar

iTrader: (6)

Again, I respect what your saying, however, everyone a couple of years ago seemed so sure the housing market was going to continue rising, now everyone is so sure that it's going to fall for X number of years by XX%, the truth is nobody actually KNOWS what the hell is going to happen.

SunnySideUp

Every single indicator and expert, analysis and vested interest say property prices will fall at least another 10% ..... some say another 30%.

If you buy now with a 10% deposit, you stand the absolute real chance that you will be in negative equity when Santa next climbs down the chimney! Nothing in property is certain, but this is as accurate a statement as you will see this side of an Estate Agents Book of Lies!

njkmrs

[QUOTE=davegtt;8404843]Who ******* cares if youre buying the house to live in and happy with what you are getting for y ,our money. Never stopped anyone buying a new car knowing its going to fall in value.....

Point well made .Most people still buy a property because they like it/the area/the schools etc .
Its not always about money for everyone .You have to live somewhere .If you like the property ,that is enough reason to buy it ,if you can afford the repayments .

fatscoobfella1

iTrader: (1)

10%-30%..

Like all experts,if your vague enough you will have the correct answer...

Most houses will go down...Im no expert,but i can tell you that its a definate.

However.. Nice properties in nice locations will always get good money.. Its the crappy one that people NEED to get rid of that will bring the biggest discounts.

FlightMan

Maybe, but I like tan argument so I'll carry on.

As you know, 8k on an 85k flat is approx a 10% deposit, so only another 8k to go then.

And how many of these 8-10k cars are owned, I'd suggest the majority are on credit of some sort.

Factor in unemployment ( another 3500 jobs gone today ) and I can't see many people handing over 15-20k for a depreciating asset, when their job is looking shaky.

davyboy

If you are worried, start over paying if your mortgage allows. At least if the worse happens you may be able to take a break from paying.

Deep Singh

No, everybody was not saying that property would continue to rise. Perhaps in your circle (and other peoples) or on Ch4 progs or sunday supplements that depend on property related advertising revenue they were

Many people I know, including myself could see this coming many years ago. And I don't mean people who ALWAYs say property will drop and so have to be right eventually, but people who were very pro property for many years but then realised that the fundamantals no longer made sense.

They may have called the top a year early, but thats not bad, you can't be perfect.
I called it two years too early, when I liquidated some. Calling it two years too early is better than calling it even 3 months too late, because by then it really is too late.

Anyway mate I'm sure you know what you are doing. I just can't understand what your hurry is, why not wait another 6 months or so when your money will go further?

Deep Singh

Coming from the guy who thought he had vaginal thrush in his liver

Mate, there have already been near 40% reduction in some new build flats, and thats in London, not some northern hell hole.

40% in many places will be no problem

Deep Singh

Denial is one of the early stages. The thought that the area that you live in is somehow so special it is not affected by a global and national recession is frankly absurd

Petem95

But the sort of amounts you are looking at losing are significant, not £3-4k a year like on a car, but £10's of thousands per year, and ok you could say "oh it'll be ok as in 20years the values will be back up", because what happens if you the values falls sharply, then you lose your job and HAVE to sell? You may sell the house, and be left with a big real debt.

Prices went SO SO high that even with 50% falls from 2007 peaks, houses would still be expensive! This is why there is plenty of scope for falls to actually be more like 60-70% in some cases, factoring in the recession and credit drought.

This current situation is massively more serious than the previous recessions we've suffered which have resulted in 'little' house prices crashes like in the early 90's.

Nobody really knows how serious our current situation is. We could be in for a Japanese-style 'lost decade' of deflation, or a more serious depression than the 30's which could lead to widespread civil unrest in the UK. Until the uncertainly is gone, confidence won't return and we'll continue this vicious cycle.

fatscoobfella1

iTrader: (1)

Im not in denial,im not selling or moving,it makes no odds to me..


My house is owned,i paid for it without mortgage when we bought it..

Good house in good locations will always get good money,i will say it again incase you misread what i said..i never said you will make fortunes while all around you sell for 1/2 price..but people will always move home,and desirable homes will bring a premium.

Im not saying i live in a great location,or have a great house.. That was was just something you assumed..And we all know what assumption is the mother of dont we..?

SunnySideUp

Good houses in good locations will sell - yes, true statement.

The thing is that these are the only houses which 'may' sell in the current climate ...... and for around 40% less than they were selling for just 13 short months ago.

That is the shocking truth which really needs to hit home, as some seem to be completely unaware of the reality out there. I'm looking to buy but not selling - I see the prices falling away daily.

nixxon

And those that don't will be worried they might...

Terminator X

iTrader: (7)

You're certifiable

TX.

davegtt

You lot are missing my point completely when quoting anything I have to say.

Obviously a bunch of money orientated morons.

My point is clearly, I couldnt give a **** if my house is worth x y or z unless Im selling it. If Im buying it, I only care whether I'd be happy living in it and owning it in the long run, as long as I can afford it and support my family, you lot seem to be living in a land of what something is worth in a shop window, and the ironic thing is, thats what you have been taking the **** out of, the people who re-borrowed on their house to fund an X5 etc.... You are no better.

Get a life

nixxon

I had a client like this before Christmas- owned a house in Dunsfold, surrey, very leafy and quiet if it wasn't for the topgear test track. They wanted me to build some wardrobes and stuff, to finish off their 2 year house renovation/development. She wanted it done ASAP "before house prices started falling". His view was "Don't be silly, house prices won't fall in Dunsfold! Everyone would love to live here!"
3 weeks later, she phoned to cancel, citing the "credit crunch" and the possibility that hubby might lose his job, but at the very least they would have to tighten their belts. He worked for Nat West! Not sure which planet/department!

ScoobyWon't

That's the way I look at things. Glad I'm not the only one.

My house isn't the biggest around, but I'm happy in it. As I'm not looking at getting married or having a family for a few years, I'll not have a need to sell it (unless I want to get another place).

Deep Singh

I may have got this wrong but didn't you say in a recent thread that a house near and similar to yours sold recently for something like £40k more than you paid for yours in 2007?
And now you're implying that good houses in good locations (including yours, and theres nowt wrong with that) will fetch a premium? I'm not quite sure what that means. Yes your nice house will be worth more than a crappy house in the bad part of town, but it may well still be worth 40% less than you paid for it.
Thats all I'm saying

Deep Singh

I hope you don't mate, but what if you lose your job? Then your paper losses will become real.

Anyway most of my comments were concerning those looking at property as an investment

ScoobyWon't

I was in the position where I was paying two mortgages a couple of years back, but luckily found a buyer just before the Spanish market crashed - I did make a profit but not as much as I could have done at it's peak.

Luckily now I've just got the one property and a job which is recession proof (IMO). I've edited my post as I think it wasn't very clear.

fatscoobfella1

iTrader: (1)

Yes i did...
But i wasnt implying anything.I was saying that everything wasnt doom and gloom,and to back it up gave examples of factual houses that had recently sold that i know of personally. Im not saying i live in any haven for house prices or an idylic place to live. i just live in a small village in Derbyshire,be that good or bad.

Anyway,were going OT.But what i wrote was a sweeping observation of houses throughout the country,and im sure that you will agree that nice house/nice location will be more proftable.. that was all i meant,nothing more.

blu scoob

Back in 1986 you could buy a 2 bed house for 4 grand,I no because I was going to buy one but instead I bought an RS turbo,(like a fool) but I was young then but now there is a chance I never thought would happen again to buy a a nice house which I thought I would never be able to afford but on the bad side there is alot of people out there going to looze there homes this year and jobs I never take chances were my house is involved,I always said I wouldnt put it in a position were I could looze it and so far FINGERS crossed its been ok but you never know

FlightMan

Well thanks for that reasoned response.

Prices may well fall by 50% from peak in 2007. Factor in house price inflation of 5% per year, as prices recover, and you've got your decade of recovery.

Now, if you can't respond like an adult, please don't bother responding at all.

Petem95

Well I don't see price levels back to 2007 levels for more than a decade.

I think what you mean to say is "you hope prices return to boom levels soon as poss as you bought at the peak.."

Gear Head

iTrader: (2)

I really don't think that London properties can be seen as the 'national average', especially when you consider that some were at least 30-40% higher than the equivalent property elsewhere in the South East.
And look where a huge proportion on job loses have recently occurred.... LONDON!

SunnySideUp

House prices are set to fall a further 10 per cent in 2009 but sales are set to increase by just as much, according to the Royal Institution of Chartered Surveyors.

FTAdviser.com - Rics: House prices to fall a further 10%