House price crash

[FabulousSophie]

I've been having a horrible experience on a website forum called HousePriceCrash.com.
I happen to believe house prices will fall significantly, which is why I went there to find out more, but many of its members behave in such a paranoid and hostile way towards anyone who dares utter any dissent towards their very particular and obsessional group beliefs. They repeatedly accuse other members of being undercover operatives for the property industry - they seem to have a grandiose idea that they are so dangerous to the property industry that the industry wants to damage them by sending undercover operatives to 'troll' their forum. They almost seem like a weird religious cult that does not tolerate heresy amongst its members, or else they will be publicly degraded and excommunicated from their church.
It seems populated almost exclusively by men, I think. One of its members seems to have become obsessed with me in a nasty way, and even though I have never responded to any of his repeated public comments to me and about me, he won't stop pestering me. He gives me the creeps. I know it is only cyberspace but I still find him a bit scary. Does anyone else have any experience of this forum?

*My impression is that a lot of the HPcers do not realistically want to buy a home, unless it is handed to them at 1970s prices

I think what they want is for prices to return to a reasonable multiple of salaries that most people actually earn*

I bought in the early 80s. I came out with £80 per month

My first place, needed all doing up so got it for £4000 less than they were going for in the street cost £9000 so 9x my salary. Or 13x my salary if I had bought a place done up.

I would hazard a guess that 13x average salary would still get you somewhere now.

The 1970s weren't some Utopia to emulate. Salaries were not that great and house prices for ftbs were still huge.

Mark They have been predicting a crash for 20 years - it is only common sense that eventually they are going to be correct. But they will not be correct because they have any special analytical skills or knowledge, as some on HPC (eg Jurassic Bland and TheCountofNowhere) would like people to believe, they will be correct because they are predicting something that will inevitably happen sooner or later.

There is no law that says the government will not pull out all the stops to inflate asset prices, and that house prices will not double or triple or quadruple again. The only hard fact is that the hardcore HPCers' self-proclaimed predictive 'powers' have already been proven to be a sham, because they have been warning of an imminent house price crash for 20 years!

If I started a website called IWillDie.com, I think I could be pretty sure of being 100% correct at some point during my life. Maybe I would even get the odd follower, who would admire my genius for prediction. Of course, medical science may delay for many decades the day I am correct, or I could be correct tomorrow.

The failure of the HousePriceCrash.co.uk is that its daily predictions of an imminent house price crash has been wrong for the last 20 years, because its members refused to acknowledge the government could intervene to prop up prices. And a lot of the more militant HPCers still refuse to believe the government could ever intervene to prop up prices, in spite of the hard lessons of the last 20 years.

What I also found ridiculous was that most of them are terrified of buying and losing money in the event of a crash, but have their head in the sands about losing money on rent in the meantime. I remember someone posting that rent was dead money and getting their head bitten off.

My husband and I rented in London for 9 years and spent about £150k on rent during that time (1400 a month). Had we bought and the property lost 150k in value we would still have been no worse off than had we rented. And we’d have been paying off some of the mortgage.

Oliversmumsarmy
I bought in the early 80s. I came out with £80 per month
My first place, needed all doing up so got it for £4000 less than they were going for in the street cost £9000 so 9x my salary. Or 13x my salary if I had bought a place done up.

Average salary in 1980 was about £6000, not £1000, so your £9K house was 1.5 x average salary, not 9x.

But not everyone is on an average salary.

Equally if you were on an "average" salary you wouldn't be buying a ftb place you would have been buying a family home.

I remember someone posting that rent was dead money and getting their head bitten off.

Probably because they’d already made bingo.

I’m having lunch right now. That’s also dead money. Renters are buying time in a place they (hopefully!) want to live. By not choosing to invest that money instead, they are regularly castigated if not pitied.

I know a guy who rented a room in the 70s in a reasonable area of North London.

He paid £60 per month.

40 years later he is still renting and thinking how stupid everyone is buying and wasting money on mortgages
Someone did once point out that he could have bought a proper flat with his own bathroom that he didn't have to cross a hallway to access 3 or 4 times over and wouldn't have to be still paying rent 40 years later.

Renters are buying time in a place they (hopefully!) want to live

From the opinions on HPC forum they are renting untill prices go down to what they were in the 1970s. In the meantime they are paying someone else's mortgage.

I would say most of us have rented at some point but it is to be used as a stop gap between houses not as a permanent state waiting for a miracle.

I think if house prices did crash HPC posters would still be waiting for them to crash further.

I think a lot are scared otherwise they would have bought in 2008

I’m not castigating anyone for renting. As mentioned I did it myself for years, and in a flat I really liked but would not have been able to buy and live in otherwise.

But many militant house price crashers claim to be in a position to buy but are holding out for a crash. So they have probably already lost more money than had they bought and a crash actually happened. Which they’d never admit to of course.

Let's not forget that it was the 70s before a lot of mortgage lenders actually took a woman's earnings into account when lending to couples. Banks and building societies discriminated for far longer than a lot of people realise.

The whole banking system would have to collapse before house prices crashed dramatically. It just isn't going to happen.

The HPC forum presents itself as a serious economic predictive website that purports to know where house prices will go one year to the next (although it has got this wrong for the last 20 years, and each year it will only tolerate predictions of a crash). If it was honest, it would rebrand itself as a political pressure group to lobby government to stop pumping up house prices. But given that it refuses to countenance the possibility that the government will continue to pump up prices, it cannot lobby for it to stop. Besides, even if it did rebrand itself as a pressure group, its high priests, such as Jurassic Brand and TheCountofNowhere are such deeply weird and unpleasant people that I doubt they would get many supporters, apart from some more of their oddball admirers.

I think I would just forget about it, tbh. Don't give it anymore headspace.

I would say most of us have rented at some point but it is to be used as a stop gap between houses not as a permanent state waiting for a miracle.

There’s a whole discussion to be had about the pleasures and perils of renting in the UK. I can understand why you wouldn't want to do it longer than necessary. But I think the desperation to own contributes to HPI as it leads people to offer as much money as they can get their hands on, which the banks were only too happy to throw at them.

From the opinions on HPC forum they are renting untill prices go down to what they were in the 1970s.

I don’t know about going back to the 70s; I’d be happy for the early noughties, aka pre-madness.

[a dramatic crash] just isn't going to happen.

You’re right so far.

At the end of the day, who cares if some people want a crash?

MarkCarnage,

I understand what you’re say about grabbing whatever you can to get on the housing market (desperation). But if you don’t do that you end up moaning on HPC 15years later that you’ve been outpriced? That I don’t understand tbh. The fact is house prices rise and fall but if you’re in it for a long term place to live and call a home why not just go for it? The days of Sarah Beeney’s ‘Property Ladder’ programme are long over thankfully. As proved by the financial crisis of 2008 when the HPC’s were besides themselves (BUT WAIT - they said we can buy a mansion in the Home Counties for the price of a semi-detached in Norwich shortly. Just wait). Didn’t happen. All that did happen was people sat tight in their homes and the market slowed. 🤷‍♀️

I was talking about renting between houses or when you are moving with work. Or when you are in uni or when you first start out.
We are probably going into rented for 6 months as it will be a miracle if we get the purchase of the next house to line up with the sale of ours.

Renting has its place but if you are renting for 20 years hoping for a crash and when one occurs you still are waiting for it to fall further then you are a fool and are wasting your money and your life paying someone else's mortgage.

In the past 20 years I have bought a home brought up 2 DC. Both privately educated on the back of the low interest rates and now looking to sell at the end of this year, moving to a cheaper area (we live in an area that has gone up hugely).
We are going to be buying something cheaper but bigger for cash and a holiday home.

Wouldn't like to be 20 years older and still in rented

HPC still seems to be going strong, I check in once in a while. They may be right this time, certainly prices in COVID London have fallen, though prices in the home counties are holding due to Londoners selling up to buy the big house in the country.

I would imagine the HPC mob are having a right laugh at this sort of opinion now, let`s face it the crash is going to be even bigger for all the years the daft price bubble was allowed to run, can you imagine "buying" a 900k house in London a few years ago with cheap debt and having your fix coming up for renewal in a few months!

Oh my goodness, that site! I just had a look out of curiosity and there is a thread with a poll asking when house prices will go back in line with salaries.

Quite a few incels on there blaming feminism for allowing women into the workforce and therefore pushing house prices up because couples could offer more! Oh

Ah, House Price Crash! I was reading that before we bought in 2016, as I was worried about a crash. We were risk averse and didn't buy until we could afford a three bed to stay in long-term and start a family, as we didn't fancy the risk of a house price crash stuck in the tiny flat we could have afforded early on in our relationship.

Since 2016 our house has increased in value by 100k (ridiculous I know).

Just started to read this thread. Poor cat. Looks bloody miserable. Understandable living with him. I would be too.

I was a member of HPC and it's forum in the very early days, like them I have been predicting a crash for ages and like them, I have been wrong!

In the early days there were some good posters on the forum, sensible and intelligent, eventually they were chased off by the fruit loops.

Part of the big early push was for Londoners to STR ( Sell to rent) forcing a glut onto the market causing a crash which they would then use their proft from selling to buy cheap.

It didn't work, no one predicted the lengths the government would go to to keep prices going up, no one wants to be at the helm when it happens.

They did have a point, I can never work out why high fuel prices, food prices, goods prices etc. is a bad thing, but high house prices is seen as a good thing?

The house I grew up in required just my father working a fairly ordinary job with some overtime to afford. It's now " worth" £400 000.

But if all the posters had bought 20 years ago, or whenever the site started, they'd have just 5 years left and they'd own outright. Instead of which, they're likely to have spent 5 figures by now on rent, in most cases, for which they show nothing.

As long as the mortgage is affordable, it doesn't actually matter what house prices do unless you need to sell up. Most people can ride it out - the issues come when a recession means people can't afford mortgages on houses which are in negative equity.

And it doesn't alter the reality that when I was a kid, we had 15 million fewer people in the country than we do now, either.

I honestly don't care if prices fall - we have a 5 year fix at 2021 rates, for a 20 year term, so by the time we remortgage we will have so much equity on what the house is worth when renovated at today's prices that if we're in negative equity we will have massive issues living in an economic basket case, screw the house. That will be the least of our issues. And meanwhile, a mortgage is. much cheaper than rents for the equivalent.

I do worry that people delay buying because they are thinking about rises and falls in the market, instead of the reality that you are paying down a debt, and in time will have that asset to your name... by which point, purchase prices matter not a jot. And meanwhile, every time you come to remortgage inflation has shrunk payments down very greatly, whereas rents always go in the opposite direction.

I think we do need a crash, actually. To help more people escape rental servitude, and make buying at least a bit more affordable. But at the same time, if people possibly can buy, then they should. Timing the market matters infinitely less than paying off a house you can end up calling your own, instead of paying off a house your landlord will.

The problem where I live (Sydney) is that now we are in the ridiculous situation where just the yearly INTEREST on a mortgage, plus strata fees, on say a very average $1 million apartment, exceeds what it would cost to rent the apartment. Never mind any principle repayment. Its absolute madness. The only way it pencils out is if the value of the apartment continually increases year on year, and I wouldn't bet on that over the next few years...

Being ancient enough to have lived through HPCs in the past, I have long been expecting at least a dip, given how prices have outstripped incomes, and was surprised it didn't happn before covid. Covid, of course, changed a lot, as did the idiocy of the stamp duty holiday (which just inflated prices even more).
Commercial property markets generally go up and down a fair bit, they're notoriously volatile. Domestic property is a bit more stable, as a rule. But what's kept it from crashing for a long time has been low interest rates for many years- something which is quite unusual historically. Interest rates are still very low, though rising. If that changes, and rates rise quickly and to the sort of high levels we have seen in the past (I recall when they were 12%) , then we may see a fall in prices. Likewise if the energy crisis and high inflation carries on much longer, taking an increasing percentage of people's incomes for other things, we may see prices fall. But there are always many factors involved.

Basically, all other things being equal, FTB and upsizers gain from lower prices, inheritors and downsizers and those needing to use equity release type schemes gain from higher prices. But all other things are often not equal- lower prices don't help FTB if they are also paying a higher interest rate, for example.