[Finance] Housing Market

[loz]

An adjustment downwards would be no bad thing, ask any parent with 3 children in their 20s, all of whom are in rented flats paying over £1000 a month !

 

[Triggaaar]

What are the thoughts regarding the housing market, will prices be impacted due to the CoronaVirus?

We're going to have a worldwide recession. Many businesses are going to go under. I can't see how house prices won't fall.

 

[Deleted member 2719]

Completely disagree, buyers and sellers need human interaction as property a very personal delicate matter , the internet can’t replicate that . I went to look at a house that was marketed by purple bricks - the communication I had with purple bricks was laughable, some young girl answered, clearly had no idea about the property, couldn’t answer any of my quite typical reasonable questions. If you pay peanuts to sell you get monkeys representing you.

Well, I put my parent's house on the market with some blagging estate agents a year ago, we struck a deal they had to get someone interested in it within six weeks, or I would use Purple bricks, they beought round three potential buyers three the table, after their blagg suggested suggested, I am not sure any of thee leads were properly qualified.
They admitted they had run out of buyers, put it on with purple bricks, the girl kept me informed and guided me on price, and she was a pleasure to deal with and always contactable.

I sold it and got 15% above market value, they sent around about six potential buyers.
Then I had issues in the chain, and a particular estate agent that had staff that didn't give a toss. They made mistake after mistake, the biggest telling me a house we wanted to buy was sold, when it wasn't, fortunately, I persisted and found out he had got it mixed up with another house.

I have yet to see an estate agent earn their dollar.

They appear to employ one senior negotiator with a load of kids as they obviously want to keep their costs down to take online estate agents on.

 

[Weststander]

As incomes drop - as they surely will if (when) we tip over into recession - then house prices should fall.

There are some other things to consider

1. virtually all asset classes are losing investors - so there's a chance that some of the money fleeing these will find it's way into the housing market;

2 if (when) government debt spirals, there could be a hike in interest rates

3. I've never once called the housing market correctly

On (2), when government debt rose hugely under Brown and Osborne, interest rates did not subsequently hike.

With all main economic powers now embarking on similar measures, the UK will not be attacked by the markets, for profligate borrowing.

Western economies over the last 12 years have experienced a sustained period of low inflation and low interest rates. A phenomenon here to stay for many more years.

 

[saafend_seagull]

Large European real estate investment fund I work for has down graded budget of income by 20 percent today and valuers are not providing property valuations as have no idea how to value in current market.

Could be 2008 all over again (if cases grow and grow for the virus).


Sent from my iPhone using Tapatalk

 

[knocky1]

As incomes drop - as they surely will if (when) we tip over into recession - then house prices should fall.

There are some other things to consider

1. virtually all asset classes are losing investors - so there's a chance that some of the money fleeing these will find it's way into the housing market;

2 if (when) government debt spirals, there could be a hike in interest rates

3. I've never once called the housing market correctly

1. True
2. Spiralling Gov Debt would bankrupt the country if hike in Interest Rates. But can’t print money forever. Taxing the rich will not happen and it will be hard to tax regenerating businesses. Resulting in hyperinflation, poverty and stagnation.
3. Haven’t worked since 1997 but can’t be lucky every time.
4. I hope the outcome is more positive than I envisage.

 

[spongy]

I think prices may drop - sadly there will be a lot of property coming on to the market being sold by executors of the previous inhabitant, with in many cases a desire to 'get it done with' and get on with their lives and grieving rather than hanging on playing hardball with buyers.

Certainly in the short term I don't think there'll be much buying and selling going on.

Sounds exceptionally morbid on my behalf but I hope so as I've just the £50k in savings for a deposit and currently looking at my first mortgage. That's if the mortgage lenders continue to lend.

Been saving for night on 10 years and this happens.

 

[Weststander]

I think the sombrero will invert, as people are scared of their future income, I also believe it to be the end of the high street estate agents and the internet to take 80% of the market with the Hamptons etc surviving.

Just a feeling.

There are good and bad high street estate agents. Some are good matching buyers and sellers, others with lazy/inadequate people.

 

[Uncle C]

, I think the market will drop a single digit percentage.

Wow with phases like that you must be a right clever geezer.

 

[Uncle Spielberg]

It’s starting to effect lending decisions and criteria already. I’ve got a client quite senior in the travel industry looking to remortgage, application went in last week, should have been a very straight forward application, declined today by one of the mid range building societies due to his line of work and concerns his income will go down.

Yes my friend, things are going to be very rocky for a while especially with lenders giving payment holidays for 3 months meaning far less money is coming in short term. Every mortgage is a battle atm but soon will be just re mortgages and product transfers with subsequent large drop in income

 

[Super Steve Earle]

Right now I’d say it will stall...new builds mothballed....plans to start new sites put on hold ...as regards to individuals not many would want to make a major purchase commitment right now..and people who would have sold will hardly want strangers traipsing through their house.......after we get through the peak of this gawd knows

At last, some good news.

 

[Jolly Red Giant]

2. Spiralling Gov Debt would bankrupt the country if hike in Interest Rates. But can’t print money forever. Taxing the rich will not happen and it will be hard to tax regenerating businesses. Resulting in hyperinflation, poverty and stagnation.

Far more likely that the upcoming recession will be deflationary rather than inflationary in character.

 

[knocky1]

Far more likely that the upcoming recession will be deflationary rather than inflationary in character.

I said hyperinflation not mere inflation. The world is now just printing off infinite banknotes so to speak. Seen in the 1920’s in the Weimar Republic and more recently in Venezuela.

https://www.econlib.org/library/Enc/Hyperinflation.html

 

[Weststander]

Far more likely that the upcoming recession will be deflationary rather than inflationary in character.

Exactly this.

 

[Tim Over Whelmed]

Wow with phases like that you must be a right clever geezer.

Or hedging my bets between nothing and 9%, not clever but can spell "phrases" and tie my own shoe laces.

 

[Weststander]

I said hyperinflation not mere inflation. The world is now just printing off infinite banknotes so to speak. Seen in the 1920’s in the Weimar Republic and more recently in Venezuela.

https://www.econlib.org/library/Enc/Hyperinflation.html

Brown, Osborne and most other central banks printed (QE) £/€/$ trillions from 2008 onwards, not resulting in inflation.

A question, in good faith - why will this event give rise to hyperinflation?

 

[knocky1]

Brown, Osborne and most other central banks printed (QE) £/€/$ trillions from 2008 onwards, not resulting in inflation.


A question, in good faith - why will this event give rise to hyperinflation?

The QE of those years hasn’t been repaid.

On one side there will be a major breakdown in supply. As we are seeing already.

On the demand side there will be a massive drop. Gov prints money to counteract. It’s sucked up immediately. Gov prints money to deal with covid19. Gov debt rising. Economy stagnant when covid19 under more control. Gov pumps in more money. The cycle begins. Gov debt rises and more money is needed.

Fiscal measures will not be an option.

The link I posted describes better.

 

[knocky1]

Far more likely that the upcoming recession will be deflationary rather than inflationary in character.

I said hyperinflation not mere inflation. The world is now just printing off infinite banknotes so to speak. Seen in the 1920’s in the Weimar Republic and more recently in Venezuela.

https://www.econlib.org/library/Enc/Hyperinflation.html

Brown, Osborne and most other central banks printed (QE) £/€/$ trillions from 2008 onwards, not resulting in inflation.

A question, in good faith - why will this event give rise to hyperinflation?

The QE of those years hasn’t been repaid.

On one side there will be a major breakdown in supply. As we are seeing already.

On the demand side there will be a massive drop. Gov prints money to counteract. It’s sucked up immediately. Gov prints money to deal with covid19. Gov debt rising. Economy stagnant when covid19 under more control. Gov pumps in more money. The cycle begins. Gov debt rises and more money is needed.

Fiscal measures will not be an option.

The link I posted describes better.

With the thread on the rich getting richer I thought I would repost my predictions on asset prices from 2 years ago.
If I'd have used "long term elevated inflation" rather than hyperinflation I'd be a f****** genius.

 

[dazzer6666]

Lloyds have just the launched the cheapest 10 year mortgage deal on record……(1.66%, max LTV 60% and £1,000 fee).

 

[nicko31]

Lloyds have just the launched the cheapest 10 year mortgage deal on record……(1.66%, max LTV 60% and £1,000 fee).

So wrong when inflation is charging along at 5%+, pre GFC rates would be 7% and you'd be paying 8-8.5%