Mark Carney Brexit house price warning

[BlueKittens]

Is now a really bad time to sell/buy a house?

We’ve recently put our house on the market to move to a larger house in the same area. Basically because I’m unexpectedly pregnant with our second child. We could hang on in our current home but we’d be a bit squashed because DH works from home. We have seen a great property nearby which we’d need to take out a slightly bigger mortgage to buy (but we have good LTV). We live in one of the fastest moving housing markets in the country (comparatively- it feels quite slow recently!). House prices are high. House has been on over a week and have had 9 viewings. No offers yet but have second viewings booked in.

Thoughts please! I don’t mind if the comments are directly related to our situation or just general chit chat around Brexit and house prices.

I can't say I'm that bothered about interest rate rises. The rates are the lowest I've ever known them (have owned property since 1986), and they've a way to go til they reach Black Wednesday heights.

Most of our mortgages have been 7.5% or higher until 2006, so now being on 2.75 is bliss. The mortgage will be gone for ever in a year.

Well whatever people in here think I'm holding off buying it's knocked my confidence I bought end of 2007 and took the hit first time (just sold at least than I paid for it)

I'm holding out and see what happens post March damned if I'm getting bit second time around too!

I'm sure there are many ftbs and those in positions like me who can hold out keep saving hard and just see what happens / grab a bargain.

I’ve done my stress testing and we could comfortably afford our current mortgage at a 8% interest rate. But at the higher level of borrowing, an 8% interest rate would leave us with less than £1k a month. With our childcare commitments it would be tight (so no luxuries like holidays) but we wouldn’t be on the breadline.

But with everyone having no spare money for luxuries and holidays means a huge impact on analyticals view of The economy is doing fine. Unemployment is at record lows and the stock market is at record highs. A very limited vision view.

House prices have ridden the huge asset bubble due to cheap credit, same as the stock market.
Both are far detached from reality.
Supply and demand is a made up problem( in regards to housing), if not there would be millions of homeless people... which there isn't!
Cut the cheap credit and house prices will fall, especially in the parts of London that have gone up 100% in the last 5 years all due to the cheap money thrown at help to buy

@Ignoramusgiganticus Anything can happen in the future. Any number of catastrophes could happen, from nuclear war to a global pandemic. Your guess is as good as mine. At the moment the economy is fine, and the future is unknown.

Also negative equity will at the absolute most affect 33% of the population as that is the amount of houses with mortgages.... but seeing as a large majority of them will have owned for over 5 years it won't affect them. So in reality it is probably less than 2% of the population. If the government cater for 2% over the other 98% then there is something seriously wrong... yes 65% of them want house prices to go up because they own a house... but won't be affected by negative equity so aren't really a consideration

He's trying to scaremonger saying house prices could fall 30%.

A lot of people will be delighted if this happens. Prices need to come down a lot more than that before the younger generation will ever be able to buy.

I'm a house owner and I'd be pleased. Would be a much healthier society.

Only 33% of houses have mortgages on them? I find that hard to believe but am willing to be proved wrong.

We're currently on the market and it's completely dead. Our agent says he's never seen a worse market. There's no confidence and people just aren't moving. There are no FTBs to fuel it. We're resigned to staying put for the foreseeable future.

www.theguardian.com/money/2015/feb/25/owners-outstrip-mortgage-holders in 2015

We'll be mortgage free next year, as are many of our particular peer group, and we are early to late 50s.

I also believe that house prices coming down would be a positive occurrence for buyers and the long term health of the economy. True, there would be both winners and losers, but I think it would be helpful to more people than there would be losers.

@ignoramusgiganticus

www.gov.uk/government/uploads/system/uploads/attachment_data/file/724323/Home_ownership.pdf

Page 3

34% owned no mortgage
28% owned with mortgage
37% rented

Ok. That's interesting then.

So big losers would be buy to letters
Actual mortgage holders not so much
Then you have the mortgage free people who are mainly boomers who have made huge unearned gains.
The figures in black and white tell a different story to what mainstream public believe

I think this is a misunderstanding. The 30% drop refers to the stress testing that BOE perform to see how the country would cope with a variety of scenarios. They are there to plan for how we would cope with disaster. It doesn’t mean they think it will happen.

For example in my company we stress test no sales for 6 months and a 3% increase in all costs to see how long we would survive under those circumstances and what the effect on staff, investors and customers would be. We have no reason to think this will happen, it’s a standard scenario test

cloudtree Fri 14-Sep-18 10:36:09

Let me guess though - mousemartin and analyticalchick are not yet homeowners?

What has 'not yet homeowners' mean, does that make non home owners second class citizens? As it happens I do have a house but am very concerned that the correction in prices which was, for various reasons, put on hold around 2003 has failed to happen.

cloudtree, there is a deep and entrenched problem with property prices in the UK and it there is much more to it than housing. Property values have an impact on all business' so we all pay the price, literally, for overvalued property. When you shop, the store carries the cost of high property prices. Their staff are either payed well, another cost to the customer or they are bailed out by the taxpayer through housing benefit - we all pay for this. This fiscal drag has always dragged this country down. A correction, a big correction, would ultimately benefit the majority of us although it might initially hurt some property owners.

FTB here, already have deposit saved, living back at home after a few years renting. Seriously debating moving back into rental for at least 6mo to get Brexit out of the way, as rents seem to be faling here - quite a few of the houses coming up for rent in my budget are ones that failed to sell at prices I couldnt afford...

Startingrid I think waiting is wise. I see plenty of downside potential for prices, not much upside.
Staying at home for those 6 months would help save a bigger deposit if that's and option
Although it might take a lot longer than 6 months for the market to find it's next direction

I’m a FTB and want to buy now as I’m terrified that if we wait then if a finincial crash happens, no lender will want to lend to us or interest rates would be extortionate, and no one would want to sell their houses. I did think ‘let’s wait to see if prices fall as we might get a bargain’ but judging by last financial crash it was extremely difficult to get a mortgage. If I was a cash buyer I’d maybe wait. Also we’re desperate for more space, at least if the world goes to shit we’ll have somewhere nice to live (planning to stay there for long term though)

If you are staying long term and need the space now then I wouldn't wait.... it's a tricky choice if you can get a good rate long term fix then any drop in prices should be negated.
And based on the last downturn the government won't let it go on for long and will come up with a scheme to pump up prices again a la help to buy

For anyone buying now, make a cheeky offer. We'd be prepared to take an offer well below asking.

Are you in London bluelady?

No, commuter belt and suffering the ripples from the London market. One of our neighbours has dropped from a highly optimistic £825k to a realistic £675k, still no takers.

Snowflakes in the south-east bleating again.
Prices have barely moved in 10 years where I am.

@AlmaGeddon. I don't think you know the definition of snowflake. No-one on this thread can be accused of that. You however, some might say you had an unnecessary chip on the old shoulder.