Property crash.

garinda

garinda

Give, give, give member
Overlooker
If you are depressed by the gloom settling over the UK housing market, you might derive some cheer from the news that the situation in Spain is even worse - unless, that is, you are one of the tens of thousands of Britons who have bought property there in recent years. In which case, you might want to put your head in the oven.

After a decade-long boom in which house prices doubled, the latest data show things going badly wrong. The market shrank by 39% in March, sales by developers are down by 60% or more compared with last year, estate agents are closing in droves and the list of developers going bankrupt just gets longer. The bigger the fiesta, the deeper the siesta.

http://property.timesonline.co.uk/tol/life_and_style/property/overseas/article4172487.ece


Will the property crash get as bad in the U.K.?

As far as I know Lancashire property has never suffered from negative equity, but it was certainly rife in London in the late eighties/early nineties. It's the only reason I was able to but my first flat.

Unless we are forced to move, for work for example, do we actually care how much our homes cost?

Will we care if estate agents go to the wall?
 
I dunno.. you can still get this property for 2 million in London

1417707953_553f74f1b4.jpg

And it's got a garden
 
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An article in the Sunday Express said that the Ribble Valley is one place where property prices continue to rise. It cited Clitheroe as a town of booming house prices where Preston and Blackburn were in a serious decline. Accrington wasn't mentioned but I guessed it equated with Blackburn.

I think the answer is to sell up, now, and move to Clitheroe. In a couple of years you can move back to Accrington having made a fortune.
 
bought mine 10 yrs ago,its value has risen over double what i paid, no intention of selling, but if i was to even now would make a fair wack, it must be folk who bought in last 3/4 yrs on a mortgage that will suffer,:) or buyers that wanna sell.
 
At two million somebody will buy it and converts it into flats. I predicted on another site a few months ago that prices would fall by 25% it now seems I may have under estimated the fall. Yes there was negative equity in E Lancs and I can remember people handing their keys back to the Building Society. If we had stuck to 3 x ONE income and 10% deposit we wouldn't keep having this boom/bust scenario AND we would have real money to spend creating real jobs.
 
My ex wife and I lost a house in 1998, after we borrowed 20k to renovate it was worth 3 times the mortgage and the loan, it would have been paid for in 2000, I got stung for a 40k job (plus a bit), then shattered my wrist and was out of work for 3 months, the loan wasnt covered by payment protection (because I wasnt offered it, or aware of it), and the Halifax couldnt snatch the house back quick enough, I wasnt aware of any help being available until it was too late, I eventually got back on the ladder 3 years ago, so all of this is disturbing to me, as is the fact that Spain is worse, my eldest son and his partner live over there in thier own house, fortunately it is paid for, but is on the barely existant market, so I gain no comfort from the spanish decline either, oh well, onward and upward!
 
its like owt anywhere derek, if yer fortunate enough to own the prop, sit on it n the market always returns at some point.:);)
 
I was an owner/occupier from age 18 until age 60.

During that time I moved house 10 times, and lived in a wide range of properties ranging from a 200yr old cottage, several terraced and a brand new bungalow.

Looking back, I consider that I wasted a lot of time money and effort on home improvements.

The value of a property is determined mainly by whether it is in a desirable location, and that cannot be under your control.

Several outside factors can damage its value-
the moving in nearby of undesirable neighbours
the re-routing of public highways nearby
the industrial development of nearby previously open land.

Owning property gives you some peace of mind and security - out of the reach of unscrupulous landlords - but during my lifetime those landlords have been subjected to ever tighter regulation on their practices.
The days of the notorious Rachman are long gone.

If you think of the basic reason why you want a roof over your head, and what you expect that roof to provide, you will probably come up with a list that depends on what you personally consider important at that particular stage in your life -
eg - near good schools, accessible to public transport, near shops, nearby open spaces, etc etc etc.

I recent years people have tended to look at what their home was worth, instead of whether it met their needs - I contend that it is worth nothing as a place to live if it doesn't meet your needs, and can be as bad as a ball and chain on your ankle.

All those people who now delight in owning a house valued at over £100,000, will not gain that by selling it because they will have to pay it out again for the next one.

Being a tenant is not being a 2nd class citizen and has many advantages -
greater mobility to move to an area which meets your needs
no legal fees and agents fees when you do move
you can expect a decent standard of repair before you move in.

This national obsession with home ownership serves no useful purpose.
 
Having been a home owner all my married life (if you count having a mortgage as being an owner!) I am tending to agree that it is more of a liability than an asset. The freedom to move that comes with rented property looks more and more appealing to me. We bought this house in 1989 and when we contemplated moving a few years later we found it was valued at less than half of what we paid! Thankfully it has recovered since then but neighbours got repossessed at one stage.
 
A good post Margaret.

We have become obsessed with how much our homes are worth financially, and not what they provide us with physically and emotionally.

The only people who will suffer if prices fall dramatically are those people who have to sell, because of work, or who are splitting up, etc.

I was friends with a girl in the early nineties. She invited me round for dinner. I was a bit suprised that whom I assumed to be her flatmate, was her ex-husband.

They were forced to still live together because their flat was worth half what they'd paid for it five years earlier. They decided their best option was to carry on paying their mortgage until prices rose again, and they could go their separate ways, each with enough from the sale to start again.

If you go to many other parts of the world 'owning' your own property isn't seen as such a goal, and many people happily rent all their lives.

Renting might not be so bad here, considering that if you live long enough, the government will take the equity from your property to pay for any care you might need.
 
Well to me your home is only worth what its worth to you, doesn't matter how much its worth on the market, everybody has to live somewhere, if you sell your home you only have to buy or rent another place, so to me its best to keep hold of what you've got.
 
jaysay said:
You really dohave to feel sorry for anyone in that possition
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...or happy that greedy investors, out to make a fast buck, are being stung, and that falling prices might mean people will be able to buy or rent homes at more realistic prices.
 
I feel very sorry for anyone who has mortgaged themselves to the hilt, and then lose their home because of the rise in interest rates.

I feel less sympathy for property speculators who are hit. They took a risk, in order to make profit, and I personally believe you should never gamble with more than you can afford to lose.
 
Now I'm on the house owning side of the fence,

We have been lucky in that we bought at the 'right' time but I would counter that with the fact that we wouldn't have moved if the house we live in now cost what it did now. Managed correctly houses can be another form of investment ( buy when low, sell when high) and can provide an alternative means of pension when you inevitably hit that period when all the kids have gone etc. You also get the pleasure of living in a nice house in maybe a better area, how much is it worth for that peace of mind?

People who mortgage themselve up to the hilt (often without realising that it also costs money to live and enjoy life) are the ones who will suffer along with as Rindy etc mentioned those who 'have' to sell for one reason or another. All you can do against that is ensure that you go in with eyes wide open having done all your research properly ( can I afford it if interest rates go up 3%, what happens if I'm off work for 6 months, would I be happy paying X when teh house is only worth 3/4 of what I paid etc)
 
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