Impending house price crash

[scooterscot]

Let's hope it happens again. Been sitting on some cash for quite some time. It may well be worthless, but it'll be useful for buying some nice villa with a pool somewhere hot.

I'm eying a couple of spots in Northern Italy and South West UK.

[Whorty]

I'm eying a couple of spots in Northern Italy and South West UK.

You couldn't afford my house fella

[OwlHoot]

Cute.

Phew! If scoots is scoffing at the idea of a crash being brief then sasguru is definitely right for once, and things will bounce back in no time!

[ChimpMaster]

Cute.

Phew! If scoots is scoffing at the idea of a crash being brief then sasguru is definitely right for once, and things will bounce back in no time!

Well if anything it goes to show the limitations of his intellectual capacity to respond with a meaningful, educated and informed post.

"Cute" indeed.

[vetran]

we are 2-4 Million dwellings short to house the population. Why would a resource in shortage become cheap as chips it might drop but investors will buy quickly.

[Old Greg]

we are 2-4 Million dwellings short to house the population. Why would a resource in shortage become cheap as chips it might drop but investors will buy quickly.

Because the downward pressures on prices will exceed the upward pressures.

[scooterscot]

You couldn't afford my house fella

I think you're right about that.

[scooterscot]

we are 2-4 Million dwellings short to house the population. Why would a resource in shortage become cheap as chips it might drop but investors will buy quickly.

Most BTL's out there (airbnb's included) are on borrowed money and in some situations now loss making.

Expect an abundance of supply + plus zero demand soon enough, worst case scenario.

[scooterscot]

Well if anything it goes to show the limitations of his intellectual capacity to respond with a meaningful, educated and informed post.

"Cute" indeed.

quid pro quo

[caffeine man]

we are 2-4 Million dwellings short to house the population. Why would a resource in shortage become cheap as chips it might drop but investors will buy quickly.

1. House prices are based on two incomes. Some people will have 0 or 1 incomes

2. Banks lend people up to 6 times double earnings. They will be more cautious with higher unemployment, and falling collateral prices. This leads to a credit crunch, as people cannot borrow 6 times earnings. Deposit sizes will increase. Banks have less money to lend too, as people stop saving.

3. Why would immigrants keep coming here, the economy is broken. Plus More death yet to come. Reducing demand

4. People think buy to let is a much riskier income, and that house prices will fall soon. The anticipation of falling prices and perceived risk of being a landlord leads to deflation.

5. As homes are repossessed, they are dumped on the market, leading to increased supply and falling prices. Falling prices of collateral leads to a credit crunch(cause of point 2)

6. Higher unemployment leads to falling wages, which feeds into point 2

7. Foreign economic problems lead to less foreigners buying UK property


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