To hope there is a house price crash this year

[blondieblonde]

I really hope there is, so we can buy somewhere. What are the chances?

Thing is felloutofbed is as a Londoner you must admit that lots of areas people grew up in are not the same.

Take my area of Kilburn for example, when we bought here in the early 90s it was not a trendy area to live in. Neither were West Hampstead or Queens Park, many friends of mine continued to rent in Fulham and Kensington, and Notting Hill because that's where they were from rather than buy. Many of these people are still in rented accommodation 25 years later.

Far too many people buying in London come in with a set of perimeters that they won't budge on, there are properties out there in a vast range of areas but people want the area they're from or don't see why they should have to move. In MN land everyone wants Zone 2 with great connections and lots of naice shops, good schools etc, and wants a period Victorian Terrace with a garden and to pay the price their parents did.

Well here's a point, until 1988 London had a falling population, it has risen since then and has now surpassed a pre war high, of 8.5 million. People's parents could afford bigger houses because they weren't in that much demand if you went out of certain areas, its now very different.

there are jobs - the 'North' ( a big place btw) has the same infrastructure are the bubble

it has the NHS, public sector, the arts, businesses, retail, leisure, etc

the wages aren't over inflated but that is reflected in housing costs

I live in the Midlands - there are jobs here - I have one

The North includes Manchester, Leeds, Newcastle, Liverpool, Sheffield etc plus a whole country known as Scotland - and bits of Wales!

It's not actually that grim you know! It also has electricity, running water, trains and airports

Well maybe people are just showing off at work. I do agree in part of what you said, house prices are so ridiculously out of reach some are just going fuck it ill spend. I can totally understand this if houses are rising two- three time w quicker than you can save. So you might as well spend than live like a skinflint and Just keep seing your savings erroded.

I moved out of london several years ago, to the south west where my london deposit bought me something mediocre outright. Prices were ridiculous then and only kept high by the avaliblity of cheap money and the offshore investors. Wouldn't take much to bring them tumbleing down. Who knows if / when it will happen, if I did I'd be very rich!

Many comments saying prices are out of touch with reality, I think in part simply because people cannot afford their first property, and undoubtedly because prices are beyong their long term average 4 times earnings.

But I have been wondering for a while if it's possible that the long term average is no longer very relevant; whether we are moving into a "new reality". What I mean is perhaps a new long term average will become established, and people's expectations of what they need or can have also changes.

For example, people's expectations of what they need or can have in terms of property in Hong Kong is vastly different even to London, because they are very densely populated. If we have a situation where our fundamentals are changing and will not change back, then perhaps a new average house price to earnings ratio is here to stay?

Longtimelurker 100% agree with you. Lived in Kingston Upon Thames for a while and totally see that it's unrealistic to decide that's where you're buying now and you won't be moved on it. However I live now (and grew up in) a very untrendy east London borough. On the edge of two London boroughs, in fact, both pretty rough around the edges, in no way hipsterfied or trendy (and work in Londons most deprived borough). However even to buy a flat on the wrong side of the tracks in any of these three boroughs, I would need circa £300,000. Which is fucking ridiculous. A house near my mum and dad would now cost me more like £500,000. Cross rail is part of this problem. But I couldn't even widen my scope and buy cheaper out into Essex now- houses there are equally expensive. So basically, to live anywhere within a good 50 miles of my children's grandparents and my lifelong friends and family, I'm totally priced out. To buy a house I would need to move 70+ miles away into Kent or up into East Anglia, and no, sorry I'm not prepared to be that far from everyone I know.

Saving to keep up with house prices isn't always possible regardless of spending, I can understand the giving up and enjoying your money instead. We save £8-10k a year plus the increase in our flat but it's not enough to get a three bed semi here - undesirable area of outer London with a potential deposit of £250k plus fees and a single salary over £50k. We will keep saving as we will leave London eventually but I've given up on buying a proper family home here. Even if we could afford it I don't think it's value for money and I don't want to be mortgaged up to the eyeballs.

Many comments saying prices are out of touch with reality, I think in part simply because people cannot afford their first property

More like most people couldn't afford their current property. In London I knew countless people going on about how their house was worth say 600k and they were only on an income of 30k. Then they would go on to say young people waste all their money on phones and should save if they want to buy

Surely if house prices crash most homeowners won't be able to afford to sell??

I got slated for pointing out we were in that position on here.

I spent ten years pre children saving a deposit - I was on above average wage but it was still a major struggle and I did without a lot.

We bought at right time for work and family -eldest getting near school age and DH getting a permanent job- almost straight after prices dropped.

Life throw us some curved balls - we had to move location. Can't afford to live close to DH work but have ended up okay in the end.

Owning the first house did cost us money - we sold it for 11 K less than we bought it and didn't make back any of the extensive basic maintenance work - electrics, boilers, bathroom that the structural survey we had covered with you should pay xx more for a specific survey as we can't tell - we owned it about 7 years and it cost a fortune but gave us stability.

We weren't in negative equity but needed to come out with enough to have a deposit for the next place otherwise our children were better off there with us paying our mortgage and DH weekly accommodation bill helping to pay some else's mortgage.

I think price do need to change - stagnation followed by slow incline would be best. They also need to build more and look at the rental market again. We'd have rented longer but the lack of security is a major issue - having to move cosst money and if you have to do that every 6 to 12 months it can soon eat into savings.

I do think there needs to be more protection for landlords as well. I was socked at the thread on here pre Christmas when someone wasn't going t pay their rent in favour of Christmas shopping. I think more people are going to find themselves renting properties on behalf of older relatives to pay for old age care.

In London I knew countless people going on about how their house was worth say 600k and they were only on an income of 30k. Then they would go on to say young people waste all their money on phones and should save if they want to buy

I found a lot of older relatives were really out of touch with how much was needed for a deposit - in fact IL flat our refused to believe the amount we had needed.

As prices have risen so the amount equal to % needed for deposit has risen yet and so many refuse to understand that.

I am sorry but two hard working professionals on a reasonable salary can afford to buy FellOutOfBedTwice the problem with your post is "to buy a house in the London borough we grew up in" neither of my dc were able to buy in the SE area they grew up in nor my dniece or dnephew or my bf dc they all moved to be afford a home (all with student loans) as did i buying my first home and most of my friends back in the 90's between the last horrific crash and this awful boom in prices. if you aren't able to save enough to buy where you grewup/rent then move same as many of the rest of us "lucky" enough to buy our homes had to. Your post actually sums up the hard done by woe is me attitude that pervades nowadays. PastaLaFeasta has the right idea give up on London and the hotspots move out a bit and stop fuelling the boom.

Well dyslexic, I am not certain that is true. Perhaps it is for your anecdotals, but there are many who buy a house and stay there for some time, develop their careers and wages, savings and equity, and then trade up. There are many 2nd, 3rd and 4th time home movers even now. They are affording their current house plus.

Please don't do that!

Those of us who live outside London and the South East quite like our insignificant, cheap, little lives

Yes I can see that house prices coming down a bit would benefit a lot of people. No point in lots of people on reasonable salaries not able to afford a house. This means prices are far too high IMHO.

I sympathise but YABU.

It isnt hard to look at areas out of london where the property is affordable and the commute to london is just over an hour, take the east midlands for example.
I just don't get why everybody is so obsessed with london living and everywhere else seemingly doesnt exist. Our friends live ten miles from london and have a longer commute time than my OH who lives 100miles from london.

Bubble's gotta burst sometime
Bigger bubble, more mess

London and the SE isn't the only place in the UK where houses are expensive, again it's like London is the only place that exists. Move somewhere else if it's so terrible

today's telegraph

It isnt hard to look at areas out of london where the property is affordable and the commute to london is just over an hour

We couldn't afford the city DH works in - partly as it's had a boom thanks to people from London increasingly moving there - but we've taken that approach. DH thinks his commute is about the same as many parts of the city we did look at. We have a big enough house in area with decent schools just not in same city as his work.

I would love him to spend less time commuting but just is't an option.

What an awful post. YABVVVU.

At a personal level yes you have my sympathies. At an economic level, you're wishing for another financial Armageddon. Few points to bear in mind.

1. London will be hit but will also be relatively insulated due to the amount of foreign money. It will also recover the soonest. Ramifications to rest of country are much much harder.
2. Post 2007 the rich/ poor divide widened. Another event like this will widen that divide further
3. You assume you will be able to buy in the event of a crash. Banks make it harder to get mortgages when the economy is a mess.
4. The people most affected in economic crashes are the most vulnerable. Money dries up. Benefits dry up.

I don't know what the answer is and at some points natural forces will (should) recalibrate markets. But another crash? Sheesh. Awful.

www.telegraph.co.uk/finance/personalfinance/investing/buy-to-let/12087337/Mapped-how-buy-to-let-will-lose-money-in-91pc-of-regions-by-2021.html

'Death of buy-to-let
A large portion of the demand for UK housing will fall away as the benefits of buy-to-let have effectively been killed off in recent budgets.
George Osborne slapped a huge tax increase on buy-to-let in the summer Budget, which will take effect from 2017 onwards. The removal of mortgage interest relief was the first stage and was followed by hiking stamp duty four months later in the November review.
This could prove a double whammy on the housing market, turning potential buyers into sellers, and flooding the market with additional supply. A survey of landlords suggested 200,000 plan to exit the sector. The rapid growth of buy-to-let during the past decade looks set to be slammed into reverse'

I found a lot of older relatives were really out of touch with how much was needed for a deposit - in fact IL flat our refused to believe the amount we had needed.

Yep I've seen the same. A woman I used to work with was calling a 550k two bed flat a bargain, despite herself earning about ,30k. She's just used to the massive gains she's made.

The telegraph has been doing lots of interesting articles recently. Almost like the powers there have sold their btl properties and are trying to crash the market

I'm putting all my money in to tulips, the price of them never goes down and demand will keep rising.

We have two rental properties,one commmercial and the changes haven't affected us at all, we dont earn enough to pay 40% tax have neglible btl mortgage so there certainly won't be a "death in the buy to let market" here. These changes, which broadly i agree with, mean that higher earners will think twice about investing and LL will be very reluctant to change properties so less will come on the market (that generally pushes prices up so sadly a lose lose) because of the higher stamp duty. The big BTL landlords with over 15 properties I think aren't affected at all because they are of course exempt. Dreadful poor reporting in that Telegraph article lots of accidental and reluctant LL trying to boost meagre private sector pensions will hardly be affected and those high earners trying to make extra will have to think twice but will propably still go ahead hardly death.

We have two rental properties,one commmercial and the changes haven't affected us at all

Do you actually understand the changes? Or is that just incorrect grammar?

They don't come in fully until 2021.

Negative equity sucks, but can be got through, if you've got a suitable property.

However a crash of the magnitude the op seems to require would come with other associated economic issues, do the op has to hope a crash occurs but their employment and outgoing and cost of living remain unaffected by huge economic downfall? Sort of if wishes were horses, really.