House prices to crash

[cjd]

Say it how you see it xx

Absolutely.

Uncle C, despite his numerous postings on that thread.....backed up by dozens of in depth charts and analysis etc etc etc etc etc was hopelessly wrong.

It merely proves the point that so often in life academics know so much theory...oh, but so little in practice.

In other words (simply put)...full of shit.

As I said earlier...would make a splendid Moderator.

 

[Triggaaar]

Oh well Unc I bought a buy-to-let this week, so that's me f**ked I guess!

True mate, so true ... My prediction is profit on capital value by 2014 if I wanted to sell and in the meantime 9.4% return on investment.

Ha ha ha, you idiot, you're probably bankrupt now because you didn't listen to Uncle C, ha ha ha! Oh no, wait...

 

[Tim Over Whelmed]

Ha ha ha, you idiot, you're probably bankrupt now because you didn't listen to Uncle C, ha ha ha! Oh no, wait...

Suffice to say I did VERY well out of that purchase .... so not really bankrupt but had to pay a healthy slug of CGT; as you should and I'd rather do that than the alternative.

 

[Triggaaar]

Suffice to say I did VERY well out of that purchase .... so not really bankrupt but had to pay a healthy slug of CGT

Why did you sell it?

 

[The Andy Naylor Fan Club]

Why did you sell it?

It was on the advice of his mortgage broker ( Unlce C ).

 

[Tim Over Whelmed]

Why did you sell it?

The core focus is my investment business which works with established SMEs & start ups and, giving the current economic climate, the money is better allocated there. Additionally, the tenant I had was very interested in buying the property and seen as this suited all seemed a good time to sell.

 

[Half Time Pies]

House prices have been propped up by state tinkering: artificially low interest rates, QE and mortgage guarantee schemes rather than genuine supply and demand. We wont know the true long term state of the housing market until interest rates start to rise.

 

[beorhthelm]

House prices have been propped up by state tinkering: artificially low interest rates, QE and mortgage guarantee schemes rather than genuine supply and demand. We wont know the true long term state of the housing market until interest rates start to rise.

while state has certainly interfered, its obvious and well known the long term state is still going to be upward. demand is strong and we dont build much, prices are never going to go down substantially or level long term until that is addressed.

 

[Half Time Pies]

I agree if you look far enough in to the future price trend will always be upwards as we have an economy which seems to rely on house price inflation and the piling up of debt (and I am not sure you could ever build enough houses to solve that particular problem) however demand is only strong currently because of cheap credit, when interest rates rise even to normal levels this will likely bring wth it major problems with debt repayments and could lead to a correction in prices.

 

[beorhthelm]

...however demand is only strong currently because of cheap credit, when interest rates rise even to normal levels this will likely bring wth it major problems with debt repayments and could lead to a correction in prices.

disagree, cheap credit is just enabling people to keep up, nudging people along. demand is strong becauses a shortfall of some couple hundred thousand homes, when we build a few dozen each year. most people dont move (or rather dont *need* to move) so can potentially sit on higher rates for long enough. debt problems affect a small proportion of the market. there are little supply side improvments, in fact government policy seems to be towards discouraging house building (ineffective planning policy, taxes and levies due up front)

 

[Half Time Pies]

Cheap credit is enabling people to buy at levels that they would otherwise be unable to afford, the funding for lending scheme which is pumping out cheap money supported by the lowest interest rates of modern times and for those that are really pushed we have help to buy all of which affectively means that every mortgage backed house purchase made in the UK currently is funded/ supported by the government.

House prices are still far too high relative to income and rents and without this government tinkering we would be seeing a very different picture/ outlook.

 

[somerset]

Cheap credit is enabling people to buy at levels that they would otherwise be unable to afford, the funding for lending scheme which is pumping out cheap money supported by the lowest interest rates of modern times and for those that are really pushed we have help to buy all of which affectively means that every mortgage backed house purchase made in the UK currently is funded/ supported by the government.

House prices are still far too high relative to income and rents and without this government tinkering we would be seeing a very different picture/ outlook.

I assume you are not aware of the strict lending vs income vs expenditure criteria that have to be satisfied by lenders and borrowers alike these days....it is far more unlikely that defaults will become the order of the day again.

 

[Uncle Spielberg]

I will say it again. The housing market will be corrected by the impact of the MMR on 26/4. It does not matter how cheap funding is if large swathe's of the population cannot access it. This will become clear in the coming months when the mortgage approvals are announced. This will then stall the market.

 

[Tim Over Whelmed]

I will say it again. The housing market will be corrected by the impact of the MMR on 26/4. It does not matter how cheap funding is if large swathe's of the population cannot access it. This will become clear in the coming months when the mortgage approvals are announced. This will then stall the market.

In fairness "stall" and "collapse" are two very different outcomes.

 

[Bozza]

I will say it again. The housing market will be corrected by the impact of the MMR on 26/4. It does not matter how cheap funding is if large swathe's of the population cannot access it. This will become clear in the coming months when the mortgage approvals are announced. This will then stall the market.

As someone who has been going through the buying process over the last 6 months or so, I believe a period of 'stall' is precisely what is required.

 

[Notters]

As someone who has been going through the buying process over the last 6 months or so, I believe a period of 'stall' is precisely what is required.

Indeed... also buying and stall would be ok, provided the interest rates don't go up TOO much.

 

[Simster]

disagree, cheap credit is just enabling people to keep up, nudging people along. demand is strong becauses a shortfall of some couple hundred thousand homes, when we build a few dozen each year. most people dont move (or rather dont *need* to move) so can potentially sit on higher rates for long enough. debt problems affect a small proportion of the market. there are little supply side improvments, in fact government policy seems to be towards discouraging house building (ineffective planning policy, taxes and levies due up front)

This is truth, IMO. The squeeze on housing stock is what is driving house prices. We're not building enough houses, and as you say, there planning policy seems non existent.

 

[Uncle Spielberg]

As someone who has been going through the buying process over the last 6 months or so, I believe a period of 'stall' is precisely what is required.

I agree but I fear the lack of available finance will force the market into a downturn. We will see.

 

[Simster]

I agree but I fear the lack of available finance will force the market into a downturn. We will see.

I'm confused. First you said it would "stall" the market, then when [MENTION=6886]Bozza[/MENTION] replied that he felt this is exactly what the market needs, you appeared to change your view and are now saying it will force a downturn in the market.

So as a mortgage broker, what do you actually mean? Is MMR likely to force the market to stall (plateau/cool down?) or will there be a downturn (prices going to fall)?

I'm interested because my house goes on the market TODAY.

 

[Vegas Seagull]

I assume you are not aware of the strict lending vs income vs expenditure criteria that have to be satisfied by lenders and borrowers alike these days....it is far more unlikely that defaults will become the order of the day again.

Give it a month or two and ways around the expenditure criteria will be exploited. Whenever this amateurish, ill founded, inexact and incompetent measure is used to 'improve' any lending decision a few years down the line it is found to have been manipulated and has added no value to the decision making process