Property crash?

Personally, I hope there is a crash of equal or higher nastiness to the 89 one - it'd serve greedy sods right.

Unfortunately, it would also hit a hell of a lot of more down-to-earth people who want a house to, err, call a "home" (strange idea I know) where it hurts, so I'll feel guilty either way.

The fact is, in Exeter, I'm in the top 15% of earners, and can't afford even a badly converted studio flat. Something has to give.

If holiday homes/buy to let were made MUCH LESS attractive, it would solve many of the problems in one fell swoop.

All that said, I was in Liverpool this weekend (don't ask - there'll be a thread about my Virmin Crossc untry train journey from hell later) and the amount of boarded up, yet probably easily do-upable accommodation was criminal. I bet if ALL the boarded up, empty houses that are capable of being renovated WERE renovated, you'd have a lot less problems with the property market, since many of these places are slap bang in the middle of perfectly serviceable terraces - they just sit there like rotten teeth. Odd...
 
dom,
the empty houses are available for a song - i saw an advert where 6 were available for about 80k (for all 6) the problem was that is was in one of the worst areas of liverpool both socially and for access to jobs / transport etc.
if these houses are to be used then much better policing is needed (although how you control 9 year olds armed with uzi's is anyone's guess) along with things like improved bus and road services. then all you need to do is entice industry back from the far east and job done... somehow i think it'll take a while.
cheers


julian
 
julian2002 said:
dom,
the empty houses are available for a song - i saw an advert where 6 were available for about 80k (for all 6) the problem was that is was in one of the worst areas of liverpool both socially and for access to jobs / transport etc
Click to expand...

Ah - but these ones were on Queen's Drive, on bus routes. Some of them (a load of flats) were partially renovated (new windows etc), then promptly boarded up! Guess what - oh yeah, someone's vandalised them - what a waste of money...
 
Lt Cdr Data said:
so perhaps raise the age of ownership till 25?
Click to expand...

Eh? Why?

I'm 22. I have a good job that pays well. Why should I not be able to buy a house? Right now I can't because prices are silly and I don't want a dump in the worst area of oldham (which I could easily afford). But why on earth should there be legislation to stop me?

I too would like to see a crash because then I might be able to buy something reasonable in a nice area. However, I don't think it will happen. There will, hopefully, be some common sense adjustment over the next few months because at the moment many first time buyers, like myself, can't get into the market.
 
Interesting debate. Lots of good points being made. Here's my 2p worth...

The mid to late 80's boom happened when inflation rates were far higher than today, so IMO property prices are affected more by consumer confidence than inflation figures. Southern England - good supply of jobs, good standard of living so higher prices. For Northern inner-city and urban areas it's a very different story. Some new and radical thinking is required, not just the usual Gov't spin doctoring/repackaging that we get.

If anything will cause a crash it will be TV and newspaper headlines. Once the media believes its spotted a trend it will pursue it relentlessly until belief becomes reality. They'll cause a crash in consumer confidence and precipitate a housing crash faster than any shift in the base rates :(

I also find it totally hypocritical of the government to warn us that we should make our own provisions for old age whilst at the same time removing the advantage to savers and penalising those who have saved whilst also contributing to the social welfare fund. I suppose they could claim it as a socially inclusive policy - i.e. we're all f**ked!
 
He he, Pino I like you.

I just got off the phone to the estate agents they say its picking up (but then they would)

In my lifetime I am always suprised by people who bought property years ago and do you know what they were all talking like you lot back then:

'I hope there is a crash etc etc'

Fact is its not going to happen is it, the market is not going to crash, yes it might slow up and even fall a bit but crash!

we bought our flat four years ago for 86k there is no way on earth that even in the next five years it would fall back to that level.

And the re-occuring theme always comes out, people that have property that we think today was cheap to buy, then they had to stretch to the limit to afford it.

One thing is for certain in 20 years time I will look back and say wow, a house for 200k those were the days! Becuase everyone I know that has bought property ever always is in a good position
 
What I find hard to swallow is that people are buying orrible houses in nasty areas for 150k. For that money I'd want somewhere I was very happy with. 150,000 is alot of money FFS, who'd want to pay that for an ex council house. I'd sooner up sticks and buy a house for a third of the price in France if I could. But for the moment I'm going to be renting.
 
gary,
the average uk wage is about 20k. the average uk house price is aprox 120k now that's 6x salary. last time i looked banks were willing to lend 3.5x salary so you're looking at a 40 to 50% ish deposit not within the reach of most 1st time buyers. the housing market has very tricky foundations in that people are having to either lie, club together or risk massive borrowing via credit cards or bridging loans to buy their 1st house. a rise of a few percent in the interest rate will wipe all of these folks out. not to mention those who've got their new porsche or have 'consolidated their debts' thanks to a rise in equity that they are only just covering with repayments.
cheers


julian
 
Heavymental said:
What I find hard to swallow is that people are buying orrible houses in nasty areas for 150k. For that money I'd want somewhere I was very happy with. 150,000 is alot of money FFS, who'd want to pay that for an ex council house. I'd sooner up sticks and buy a house for a third of the price in France if I could. But for the moment I'm going to be renting.
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And people wonder why I stay at home...

Seriously, a crash has to be a good thing overall (without knowing all that much about these things), because eventually we are going to be at a point where only the richest young people will be able to afford to move out which can surely not be a good thing. As for the houses themselves being worth more, unless you are involved in buying and selling property, I cannot really see what advantage it has to the average person. Example, my parents paid £68k for our house, 3 bedroom detached house. Now it is worth £200k or whatever. That sounds great for them, but if they want to move out, then then they will still have to pay more for another house, so it doesnt really make them any richer.... but as I say, I dont claim to know much about this, but I just cant see the benefit of having a situation where people have to borrow 10x more than they earn in a year to have a house... :rolleyes:
 
I kind of want a crash otherwise I have no chance of getting in the property market in South Manchester unless its an ex council flat 300ft up in the air. My parents 3 bed terrace house is now worth £180k and similar examples have gone for £200k. Just 1/2 mile down the road larger 3 bed victorian terraces have gone for £300k. In Didsbury many properties are now over £500k and I have seen houses going for £1m+

Even in Moss Side where the riots were terraces houses have been sold for £100k and that isn't a nice area. I don't know how anybody is expected to buy houses at these prices. I worry for my future because I will have an £8k student loan to pay off plus I would struggle to pay a mortage on a £100k flat.

Even houses in Salford which will only 5 years ago were sellling for £5000 are now going for £50k and this part of Salford is really not nice unless you like factory pollution for breakfast.

My parents can't move out because if they sell their house where do they move to? Moving out would be pointless because the cheaper houses are either in a rough area or too small.
 
Also I don't think propety companies help. There is an area nearish to me where Withington Hospital once stood. Now they have built luxery houses and flats. 1 bed flats are going on the market for £250k. This isn't even city centre it is 4 miles into the suburbs. The area itself although not rough is not the nicest part of Manchester, but marketing geniuses have make the area seem much more attractive than it is to get stupidly high prices.
 
garyi said:
And the re-occuring theme always comes out, people that have property that we think today was cheap to buy, then they had to stretch to the limit to afford it.

One thing is for certain in 20 years time I will look back and say wow, a house for 200k those were the days! Becuase everyone I know that has bought property ever always is in a good position
Click to expand...

Just seen this, and I have to say from my limited experience, what you are saying seems highly improbable. Combined, the folks were earning approx £40k a year back in 95 when they bought their £68k house. Now they earn about £55k combined yet it would cost £200k to buy.

One thing that seems very clear to me is that the price of property has gone up far more than everything else that comes under the cost of living. How can this be a good thing, unless of course you are already rich and own several properties that you can sell?
 
Paul, Its just the way I see things. I am not sitting here saying its all right and hunky dory. For us who are already on the ladder we are stuffed, we can't really afford anything more than what we have, its only the moving back south that gives us any chance of anything, and that will most likely be some where god awful like Amesbury or what ever.

You are right in the recent past people have been able to afford more for their money, but how does anyone here see the housing market crashing?

This is a big statement, and in our lifetimes has only happened what once? And this was a long time before the bank of england were in control, it is not in their interest (or anyone elses) for this to happen, so I believe that houses will level off all fall slightly, but no crash.

My statement regarding the past seems fair enough, people struggled to own houses, its a weird and very British thing to care so much about owning property, but I don't ever remember hearing anyone say at any time in my life time that the house they purchased was an utter bargain and very affordable, but perhaps this is the background I come from.

It really is frustrating for all of us and in the end a crash would not destroy my wife and I because the way we see it if we got back what we paid for the flat thats great anything else is a bargain! Another British thing is how property that gets older and more decreped seems to go for more money lol.

A well, as long as we can live a life sit here at our computers and play on or expensive HIFIs I don't think any of us should moan about or lives to much, it ain't that bad.
 
I agree with the above, totally, the average wage is supposedly £25k, most people I know earn half that, that's more than a good teacher, or fireman.
civil servants, £15k.

now how can anyone afford an average house at £180k, that is 6x mortgage, a totally ridiculous state for a decent country, ie most normal people cannot afford.

And these investor types are buying up foreign houses to shaft the poor locals there, too, is there no end to the greed?

I am sick and tired of hearing about house prices,(and terrorism, Iraq and the American Presidential Election for all it affects us, the 51st state with governer Blair :D in fact, I have media maliase syndrome, total utter fatigue with it)
and I wish for a crash, sooner the better.
 
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paul,
if 'you' have a house you paid 68k for and it's now worth 200k then you have a hell of a lot of equity built up in the house. lenders are willing to give you loans at mortgage rates for any purpose so people are using this to buy holidays, cars, consolidate debts or improve their homes with kitchens and extensions. only the last 2 really make sense as they are improving your situation. this means that increasing house prices are advantageous even if you don;t intend to move. hopefully the boe will increase interest rates and that will trigger a lot of reposessions, then with a glut of houses on the market the market will collapse to a more reasonable level.
cheers


julian
 


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