To worry about the predicted 30% fall in London house prices

[feellikeahugefailure]

This would have huge knock on affects if they let this happen to everyone in the country.

It wouldn't help people that cant afford a home, it would probably make them worse off as banks won't lend. The poor will be hit the hardest by any downturn.

Mr Carney does need to do something imo, was surprised that the rate wasn't dropped. But it will have to be in August.

house prices are mostly based on the availability of credit
It seems as if this information is starting to filter through now, even so no one can predict how things will pan out

jenny
Interesting points, thank you.

I remember back in the day, 2006 time, I had friends who lived in the midlands and a few of them managed to buy a house using a 100% mortgage!

One friend did not put a penny towards her new home and in fact borrowed something like 105%

That certainly does not happen anymore!

One friend is still living in the 3 bed terrace she bought in Stafford- has extended it & done a lot of work to it.

It worked out well for her as she did not plan to move again soon and was not affected by the stagnation in prices that has affected other parts of the country.

Also I would be very interested to see the effect of removing London Help to Buy- the equity loan where the government loans you 40% of the property price.

I wonder who will be buying those new build 2 bedroom flats in zone 4 and beyond, costing £550K?!

Overseas investors? your average couple, earning an average wage....hmmm

This is just an example of what is on offer to "help" first time buyers in London...

www.crestnicholson.com/developments/dylon-works/availability

As a U.K. Expat outside looking in I have need a noticeable decline in optimism. People in the U.K. Are preparing for a rough few years. There is not a chance I would ever consider returning to the UK.

The Basel3 banking regs in force Jan 17 will limit lending to 4x income, or 30% take home pay.
Todays values are held up in some areas by 10x salary lending.
Btl is being destroyed by regulation changes also.
See the Telegraph today, house speculation is now a political bad smell.

The Basel3 banking regs in force Jan 17 will limit lending to 4x income
when you think about it that's huge isn't it (as in will have a huge impact)
lets hope we have a slow correction in time to avert a crash

That's NEW mortgages right ???

Cos at this rate mine won't be completed by then and our mortgage is in place

I'm not sure what the effect will be on existing mortgages?
obviously it would be catastrophic for society as a whole if banks were foreclose en masse, and basel3 is intended to strengthen the economy not blow it up.

It will be for new and by definition remortgaged lending.
Preferred max Ltv is 80%.
Non owner occupier mortgages classed as commercial lending with higher risk weight ratio, higher irs.
Non amortising loans ie interest only mortgages will carry far higher risk weighting, 6/7% rate over Boe base rate to reflect exposure.
Some new tests are being applied currently for new lending.

I'm sure all those with non owner occupier mortgages will have researched this thoroughly and drawn up a detailed plan of action

Gotta keep your ear to the ground if you have large amounts of borrowed money invested!

jennyj123 -

Interesting to hear your thoughts.

I am aware the rental market has slowed in London, and have done a bit of reading about it, but couldn't tell if it was a seasonal slow down or a legitimate downward trend.

In our part of central London, it seems that it is mostly the cheaper properties that are in demand, atm.

Anybody want to give their recent experiences of London housing market? We sold at quite a loss. We had only bought 2 years previously but it quickly became too small with new baby. We were afraid if we waited longer we'd lose more. Hoping to recoup loss on next purchase but the housing stock is so awful - prime central London. Rightmove seems to be on two tracks; old stock being reduced, new stock asking ever increasingly ridiculous, eye-watering asking prices. Nothing's shifting. Total stalemate. Where is this going?