To worry about falling house prices

[Ll81]

They say prices in central London have been falling for a while and this is rippling out to the rest of the country. Also lots of talk about raising interest rates and they could also be another downward pressure on prices along with lots of EU nationals leaving.

Anyone else worried that falling prices may mean many that have bought in the last few years maybe stuck in ne?

Please allow me to be the very first to offer you the warmest congratulations on your new home

Samantha77hat

And the answer to my question? Who lends 6x?

Err well thank you. We’ve lived here 6 weeks now so you’re not the first to offer congratulations on our new home by any stretch, but thank you anyway.

I meant the first on this thread, mazeltov!

How lovely.

A sincere congrats from me chien

thank you confused

@cherrycoke - it is happening now!

What is?

Granny: afraid it is a one size fits all for potential "accidental landlords" GOING FORWARD...(ffs) goodness - .

I can see why the "wear and tear" changes have zoomed over your head, you can't seem to grasp words in front of you. No-one gives a shit about you and your personal circumstances (or the self selected "friends" in similar cushy circumstances).

The world is changing around you whether you have the wit to see it or not.

Going forward the "accidental landlord" would be a fool to do so into a rising interest rate situation, potential price falls etc.

I know that's too technical for you, so as you were. Please no need to overshare how happy you and your tenants are YET again.
My conversations are about the wider world not your narrow personal view.

"accidental landlord": yes, I try to take time to put the " " around it to illustrate no-one's fooled by their justifications - it's about potential future gains they don't want to miss out on, but the future losses are the other side of the coin and they're here.

Exit plan is the most important decision to arrive at when entering something like btl otherwise some will be at risk of losing everything.

Not you Granny or Scary or the people you know - just the wider economy which is made up of lots people you don't know and who are reacting by selling their btl properties.

Pretty sure those happy tenants would be much happier if house prices were sensible and they could afford to be owner occupiers

But going back to my previous post- how can they get sensible? How can a £500k family home become a sensible price? A fall of 10% would be disastrous for the economy but wouldn’t make houses affordable. They’re not going to fall 50,60,70%. It just won’t happen.

The only way it will is to have a very very long period where prices fall then remain stagnant whilst wages increase. You’re talking about this taking like 20 years.

I just cant understand how people could ever think that maybe in 2019 house prices will crash spectacularly yet somehow they’ll keep hold of their jobs and prosperity and suddenly be able to buy. That’s not how recessions work. It’s incredibly naive

It is naive to imagine that everyone who rents actually wants to buy, this may be true for a percentage of the population particularly settled people from their mid twenties onwards but it is not true for everybody. I rent because I am on a short term contract overseas and it makes no sense to buy. I have in the past rented my house out to people who are looking to move into a new area and wish to settle and get to know the area before buying, people who are on short term work contracts themselves and people who for specific reasons have decent monthly incomes but credit ratings that would mean a morgage wouldn't be possible. I also know of older people who don't wish the hassle of house maintenance so choose to rent.

I also completely agree with cherry being old enough to have seen a couple of housing recessions come and go.

We are just buying another btl, it's the only way to guarantee an income and provide long term growth for our pension.
There do seem to be a lot of previously tenanted houses for sale in our area in NW, but house prices haven't come down much and won't in comparison to London and The South.
NE is only a problem if you intend on moving, then you stand to lose out.
If you stick to your property long term, it will increase in value eventually.

Where I am SW London houses are going for 150-200k less than they were. There won’t be an almighty crash & it will still be hard to get on the ladder. But you can’t have ever increasing prices when ftbs can’t get on the market & lending has tightened. Wages are stagnating & interest rates will rise (slowly).

I could be wrong but I fail to see how a flat that cost 550k in 2015, 750k in 2017 will go onto sell for 1m in 2019. So much of the growth in London/SE over the last decade has been driven by low interest rates & equity. Now every area has gentrified (even if just on paper) & prices are stupid.

Who is going to pay 1.1m for this?
www.rightmove.co.uk/property-for-sale/property-51309288.html

I think some Northern cities will do well & see lots of growth.

Do you remember when £1million pound houses looked like £1million pound houses?

In the 90s you could get a nice house in Wim village for 1m, more recently 1m would buy you an extended terraced period property in an area with fab schools. Now you can get an ugly unmodernised house in not great area.

Not sure that a fall of 10% would be worse for the economy than a “very very long period where prices fall then remain stagnant” (whilst keeping fingers crossed that wages increase in any useful amount); never mind how hard hearted that would be towards the generation or two consigned to rentals. In any case how the economy decides to go to hell is not something we get to vote on. Que sera, sera.

I didn’t say it would be worse. I said a fall of 10% wouldn’t make houses affordable, but a period of stagnation, with rising wages, eventually would. Both are incredibly unlikely anyway

I didn’t mean to imply that you’d said that, rather that IMO prolonged stagnation would also be disastrous. We are however in agreement that a 10% fall isn’t enough .

Did we find out what ‘is happening now!’

Most definitely not coming down where I am, up well over 10% on quality 3 bed semis in the past 2 years.