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?

Those who have just bought/maxed out/overstretched on their last purchase will suffer.

And the family with a £600k mortgage with their deal coming to an end and going from 1% interest to 4?5?6?%? - added to increased CofL prices on everything else.

Households who are splitting up and need to sell will lose money as prices go down (and prices were cooling even before Kamikwasi's mini budget...)

It's a mess

A much needed mess though, a massive house price crash is just what is required to level the playing field, stupid debt soaked borrowers are not wealthy, they are just stupid.

Interest will of course be much higher next year, however it’s predicted to the steadily decline reaching a new base of 2-2.5%. The days of 0-1% interest are over, but the rates will settle and that is the prediction.

The majority of people with mortgages are tax paying workers i.e. PAYE, self employed etc.
In a recession jobs are lost, cost of living is going up with inflation and people won’t be able to cover bills. There will be repossessions.
Those with paid off properties are usually older, retirees. They consume less and provide less to GDP.
The market will follow the tax paying workers as they are the ones at the beginning and middle of chains. If there are a lot of forced sellers and negative equity, the boomer house prices will be going down too, no matter even if they won’t be any danger of repossession and own outright or not.
Problem is we have 2.5m+ BTL landlords in the UK. Majority being 55 or over and having used their own houses as collateral.
The majority of the country will be effected by this, and places the South and SE which has seen the biggest rises will be the areas that have the largest falls.

Because that is the prediction. Rates will decline again, although not to the lows we’ve seen recently. We probably won’t see 3% mortgage rates for a while, but they will likely decline then settle not hugely above that, after the big rises next year of course.

The last inflation cycle we had was in the 70’s and that lasted near a decade. It was only overcome by Volcker raising rates to 20%. Interest rates are set by the BoE and treasury yields (which has caused all sorts of issues by spiking this week in response to the BoE and budget). Only a combination of higher interest rates, public sector/welfare spending cuts, austerity and a recessionary slowdown will reduce inflation. Interest rates could well be higher for some time, problem is that this isn’t just the UK, it’s global.

Well thank goodness for your wisdom to come along and save us all from the madness unfortunately it has been a government policy to interfere for the last 25 years minimum probably before then but we’ve only really felt the effects of it since 1999.

unfortunately for you though governments have too much skin in the game now, vested interest and its too big to fail, simply won’t be allowed to happen look at the banks in 2008.

Given that this is global rather than a UK problem why are you looking to the UK’s historical outcomes as a prediction for the future?

Why do you think a massive crash will level the playing field? It won’t. It won’t be first time buyers and lower income people that benefit from it. There won’t be the housing stick available to buy, the majority of people won’t be selling. Lending will be massively tightened and with high interest rates, most will still be priced out of the market. However, I have over £120k equity in my house, a decent household income and savings in the bank. We can withstand a big price drop and would take advantage by buying additional property for by to let.

And why are calling me stupid? I’m not. We worked very hard in our 20s to be able to buy a house with no family help and are now early thirties and on the next rung of the ladder. We aren't boomers, we’re millennials, and there’s a lot of money around in the millennial group who have worked our way up despite starting work in the last financial crash and dealing with high house prices.

@DeadHouseBounce has an agenda…determined to spread fear on numerous threads

Dead house bounce is completely wrong. Boomers, gen x and millennials have made SO much money and paid off almost all of the original debt. In our immediate family - say, us and two sets GPs - that’s almost £3 million, and we are just average families. You really think this will make things harder for us? Of course it won’t.

Not to mention I for one since taking out my mortgage at the beginning of the year I’ve had a 20% pay rise I most certainly not the only one and whilst I do always feel for public sector workers the private sector is doing very well right now.

Even with this alleged recession you have to remember by the definition a recession means that we have gone backwards for three months in a row, we have gone backwards by 1% for three months in a row which means instead of growing at 100% we have grown at 99% just as an example to make the figures easy.

We haven’t grown 99%! Where did you go to school?

Because it’s effecting everybody at the same time?! Have you seen US, Canada and Australia’s housing markets tanking?
Also some argue that due to our falling pound, foreign investment will hoover up cheaper properties, negating the downside.
Problem with that is, all currencies other than the $ is tanking. Also rich Russians can no longer buy, and Chinese investors have their own real estate time bomb with Evergrande.

Good for you with your 20% pay rise, the majority of the countries workers haven’t been so fortunate and will struggle with the cost of living and bills increasing with inflation outpacing their salary increase.

I clearly stated that I was using those numbers for ease of mathematics for the hard of thinking.

The majority may not of had 20% pay rise is but plenty have and plenty of hard pay rises between five and 20% so may have even had 25% there’s lots of variables involved here.

it’s almost as if everybody’s individual circumstances are different isn’t it ?

I can only assume that pp talking about how easy it will be to ride out the recession have not lived through any. But if you want to know the direction of house prices, look at what is happening to shares in associated industries. Smarter people than me have already figured out the direction of travel.

"we have grown at 99% just as an example to make the figures easy."

It is not about your figures it is about the fact that this sentence, regardless of figures, being wrong.

"The majority may not of had 20% pay rise is but plenty have and plenty of hard pay rises between five and 20% so may have even had 25% there’s lots of variables involved here.

it’s almost as if everybody’s individual circumstances are different isn’t it ?"

Pay rises matter less when you lose your job because people have stopped using your service or buying your product, when people compete to do your job cheaper.

I think it's inevitable prices will fall a bit & likely stagnate for years. Its going to take a significant mind shift for people to accept paying more interest. We are already on a fix & looking at calculators my mortgage would now cost a lot more just in interest. It would certainly make me lower my budget. I don't see how you can have high interest rates & high prices.
My main concern is the knock on impact on wider spending & jobs.

Boomers, gen x and millennials have made SO much money and paid off almost all of the original debt

I don't think that's true for millennials.

In our immediate family - say, us and two sets GPs - that’s almost £3 million, and we are just average families.

My family is similar & I think that will change. It's a good thing tbh, it's ridiculous that average houses cost so much & that jobs are less important than house price growth in terms of creating wealth.

The UK currently has the lowest level of unemployment since World War II.

@donttellmehesalive what’s your definition of a recession then versus an economists 🙄

It's going to get harder next yr, when the energy bills have hit & when more fixed rate mortgages come to an end.