London Property, Brexit, Chain's Breaking

[LanaLeder]

Just a thread to share experiences of what now?

Was in the process of buying a flat with my sister in London, the chain has completely collapsed. We still wanted to go ahead with the purchase, but the vendor has pulled out.

Not sure what do now? I am sure prices will fall (by how much, who knows), but there probably won't be much on the market to choose from and the mortgage market itself may move against us making it harder to purchase.

What is everyone else doing currently involved in buying/selling London property?

[walworthian]

This is a deliberately made up threat, designed to reduce market sentiment. See here for admission by author:

www.housepricecrash.co.uk/forum/index.php?/topic/210319-the-effect-of-brexit-on-house-prices/page-3

[beluga425]

Whatever was there has been removed. What did it say?

[Whatthefoxgoingon]

I think what walworthian was saying that some people have a vested interest in seeing house prices fall ie they want others to lose their money because they didn't have the foresight to buy a house themselves when they were much cheaper. So they are spamming other fora to make it seem like house prices are collapsing everywhere. Some chains collapse, it's very common. It's got nothing to do with brexit. It's mostly business as usual in the property market.

[LanaLeder]

Not deliberately made up at all, I am a semi regular poster here.

I did have a look at the link to house price crash and it seemed what the guy was saying is that he has found many threads with people panicking and he is posting on a few of them.

[Whatthefoxgoingon]

No I didn't say you made things up LanaLeder, but I have looked at the house price crash website (biased much?) and there were people encouraging posting on mumsnet about property doom and gloom eg saying that they should post about chains collapsing, low offers etc etc. to spook buyers.

[Whatthefoxgoingon]

I should also add that I'm not buying or selling property at the moment, nor do I have a mortgage. But if we have a crash, I'd swoop in as a cash buyer. Still don't want a crash, as I know it will hurt a lot of people with mortgages.

[JoJoSM2]

My husband works in property and yes - they had people pull out following brexit. Moreover, house builders and other property companies listed on the stock exchange crashed completely - the biggest drops of all sectors.... I don't know what will happen in the future but it does look terrible.

[EllenTheEgret]

they didn't have the foresight to buy a house themselves when they were much cheaper

I don't usually do angry posting, but I find this hugely insulting. Do you realise that done people couldn't afford to buy 10 years ago (or whenever)? Or maybe the were 15 years old at the time, or maybe their life circumstances didn't allow it. Now house prices have spiralled so fast that home ownership in London is forever out if their reach.

Yes, a crash would hurt people with mortgages, but the current situation is hurting many people without them.

I'm not saying I want a crash, of course, but a lowering of house prices in London, while it may be negative for some, would be hugely beneficial in terms of allowing it to remain diverse and vibrant and a generally pleasant place to live, rather than somewhere where only the wealthy/foreign investors can afford a house and anyone vaguely "normal" just gets bused in on shitty public transport for the day.

Rant over. I think I need a cup of tea.

[TurquoiseDress]

Ellen
I completely agree with you!

Such a wanky statement to make saying people did not have the "foresight to buy when they were much cheaper"

Oh yes, I should have used my foresight to buy when I was a full time student, silly me.

Honestly, attitudes like this are ridiculous.

The London property market, at least, needs to be slowed down somehow. Otherwise, how can any normal person/couple get on and buy a home?

I am not advocating a huge crash, as I can see how people with big fat mortgages will get burned, but a correction of some sort needs to take place soon.

[Whatthefoxgoingon]

I'm not talking about people who were too young to buy a decade ago, so keep your hair on. It's just shitty luck you weren't old enough to buy.

But wishing for house prices to fall, whilst knowing full well other people could lose their homes, so you can buy a house is pretty wankerish.

[HopelesslydevotedtoGu]

but wishing for house prices to fall, whilst knowing full well other people could lose their homes, so you can buy a house is pretty wankerish.

In that case wishing for house prices to rise/ stay inflated whilst others will never be able to afford to buy is also selfish.

[Whatthefoxgoingon]

Well one side will lose for the other to win. Own up to your selfishness then! I'd do very well in a house price crash, as a cash buyer. Maybe I should be selfish and wish for one

[eyebrowsonfleek]

I think a lot of people are going to be spooked by the result and delay moving. Even if prices fell, I think that there will be a shortage of property to buy as things are so uncertain that people won't want to move.
Can you wait to move?
The base rate (and thus mortgage rates) are set to fall next week.
I'm hoping that the financial situation calms down quickly but fear that Cameron will drag his heels and not Brexit properly because he doesn't want his legacy to end with the breakup of the Union. He's not set to leave until October

[DirtyDripSpout]

My chain has broken due to Brexit. Our buyers pulled out. They had an 85% LTV and I can fully understand their nerves when there are many forecasts of house prices falling. We are taking our house off the market too as we want to see the impacts of not just Brexit, but the increased stamp duty and removal of mortgage interest relief on rental properties and interest rates generally. I also find it worrying that on Friday that the biggest fallers on the stock market were companies that are property related. I guess we are also spooked, and will wait until there is more stability.

[LanaLeder]

I was surprised my chain collapsed as everyone bar my sister and I were moving for family reasons (to be close to parents, schools etc). I don't understand how/why people would put their life on hold for fear of Brexit when they have options.

Reminds me of 2008, we had many friends who delayed purchasing as they wanted to see how far low prices would drop. As you all know, they didn't fall much or for long in London and come 2013 these same people were running around trying to buy a flat, when their initial plan was to hold off till prices fell to buy a house in order to start a family.

Even though a crash would be beneficial for some, I don't necessarily want to see that as a lot of young people who bought recently with young families would get burnt. Ideally a long stagnation of prices, allowing people to save, would be my preference.

[TurquoiseDress]

Well a decade ago I certainly wasn't too young to buy (I'm 38 now!) but I definitely did not have the means to buy!

Now that I do, yet myself & DH both working full time- we can barely afford a shoe box in London.

I do not sit here wishing house prices to crash & so that people lose their homes.

But I do think that some sort of break on the crazy price rises or reasonable correction need to happen.

There is a subtle different between those two statements.

I still stand by my thoughts about stupid, sanctimonious statements about people not having the "foresight to buy".

Well, just maybe they couldn't afford to?

[BipBippadotta]

I've pulled out of a house purchase post-Brexit. It was going to be a bit of a stretch for us as it was, and given that my DH is self-employed, doing contract work for a company that lost 40% off its share price the day after the vote, it seemed deeply unwise to go ahead. We will still sell our house if our buyers don't pull out - and will rent for a bit while we decide what to do next.

Agree about ridiculous offensiveness of 'lacking the foresight to buy' comments. A lot of people were young children when houses were last remotely affordable in London. A lot of people don't have high paying jobs or family money or partners to share the cost of buying with, etc etc. Stunned (but alas no longer surprised, after the past few days) that this needs spelling out to people.

[BipBippadotta]

I mean, while you're sneering compassionlessly at the financial situations of those less fortunate, why not have a pop at people whose homes are at risk from a house price crash - - they clearly 'lacked the foresight' not to get themselves into negative equity when there was clearly a housing bubble on. Christ on a bike. Times are hard enough without all this goady gloating.

[Whatthefoxgoingon]

You want a price crash so you can get a house? Well if they crash it will be in the midst of a deep recession. The mortgage rates will shoot up (15% interest rates anyone?) so unless you can afford double digit mortgage interest rates and pass even stricter affordability tests and have a huge deposit, these cheap houses will be taken by rich foreign investors who don't need a mortgage. Meanwhile thousands of ordinary people will be in negative equity.

House market crashes don't happen in isolation, in a booming economy with wage increases and people with lots of disposable income. They happen when the shit hits the fan and the economy is tanking.

A slow deflation in relative house prices takes years and in the context of steady wage increases and increased productivity. That would be great. But it takes a long time and our economy is not looking good right now.

[Whatthefoxgoingon]

And yes, plenty of people I know did not buy a home when they had the money to many years ago. They spent it on holidays and designer clothes whilst laughing at me slogging my guts out to pay a mortgage.

Not everyone is in this group, and I didn't say everyone was. So no need to take personal offence. I don't mean you.

[BipBippadotta]

I have a house, thanks.

It's possible with Brexit & loss of global relevance of London that foreign investors might dump their properties - as might UK btl landlords (for the same reasons, plus mortgage rates, stamp duty, etc) which could make housing affordable for people again.

Though not, of course, if they don't have jobs! It's a pretty shit situation all round at the moment. Which is why I don't think it's particularly nice to gloat over other people's misfortunes.

[Whatthefoxgoingon]

Nobody is gloating. People gleefully hoping for a house market crash are not likely to get the outcome they are hoping for in a shitty economy. Be careful what you wish for.

[TurquoiseDress]

It'll take more than a house price crash for us to afford an actual house round here where we are in London!

It remains to be seen how things pan out.

[Whatthefoxgoingon]

I want people to be able to afford homes (yes, even in London!) but we need wages to go up and a booming economy for that. Not repossessions, negative equity and deep recession.

[helpbuyingahouse]

We exchanged on our purchase today. I will only care about house prices if I become a forced seller. Otherwise it doesn't matter.

I am still hoping Brexit doesn't happen but if it does, I hope our government will do the best for all of us.