House prices and recession

[Mumof22020]

Whats everyones thoughts on house prices are they likely to come down in price if theres a recession? The prices are crazy at the moment and with the cost of living going through the roof we're surely going to hit a recession.

Residential property prices are amazingly difficult to forecast, almost impossible in fact. There are so many unpredictable variables that affect how the market behaves.

If people had listened to Lightscribe's predictions in the summer of 2020 they could well have cost themselves a huge amount of money.

What has the next couple of years got in store? Nobody has really got a clue.

@Mildura

Residential property prices are amazingly difficult to forecast, almost impossible in fact. There are so many unpredictable variables that affect how the market behaves.

If people had listened to Lightscribe's predictions in the summer of 2020 they could well have cost themselves a huge amount of money.

What has the next couple of years got in store? Nobody has really got a clue.

I said the stamp duty holiday would cause a mini boom, before ultimately interests rates rise in response to inflation and then ultimately cause a downturn. Which part was incorrect there?

I can’t predict catalysts to exact timescales (who knew end of covid then Russia was going to happen) only eventual macroeconomic direction.

We’re are now at the interest rate rising part, with the Fed projected to steepening the rate rise curve (which I did predict) now by doubling the rate raises to 50 basis points for June, July, August, September uplifting projection to 3% year end.

www.forexlive.com/centralbank/citi-now-sees-the-fed-hiking-by-50-basis-points-in-may-june-july-and-september-20220325/

Real estate isn’t crypto or the stock market, due to the amount of vested interest, investments and money involved. It’s often the last thing to respond like a massive oil tanker changing direction.

And ultimately I need somewhere to live. So I have bought the most expensive property I could afford in the best area I could afford.

I said the stamp duty holiday would cause a mini boom, before ultimately interests rates rise in response to inflation and then ultimately cause a downturn. Which part was incorrect there?

That's all fine, but a lot of the stuff you said in 2020 has proved to be quite wide of the mark.

[quote Fretfulmum]@rainingsnoring the thing is there is always another rule for the mega rich. They will find loopholes and the London playground will remain for the rich. I highly doubt the Russians are worried and they probably are trading through other overseas accounts without the sanctions causing too much of an issue for them. The tax incentives are just too great for the rich and London allows them to park their cash without too much trouble.[/quote]
Absolutely agree about one rule for the wealthy elites and another for everyone else and yes they can pay v expensive accountants, lawyers to find loop holes. I'm just suggesting that there may have been a change in sentiment in terms of them investing in the UK which other super wealthy people may also take note of. That may reduce UK investment in general.

@Mildura

I said the stamp duty holiday would cause a mini boom, before ultimately interests rates rise in response to inflation and then ultimately cause a downturn. Which part was incorrect there?

That's all fine, but a lot of the stuff you said in 2020 has proved to be quite wide of the mark.

You’ll have to be more specific. Work from home? That’s still here to stay with hybrid working. Cladding backlog fire certificates with London flats? Still an issue so flats will be harder to sell. Foreign investment leaving London? Evergrande in China and sanctions in Russia have now made sure that happens. As I say, I cannot foresee exact timescales (world events can change that short term, lockdowns, virus variants, wars etc). All the above does do however is put more weight in the direction of the turn. Let’s break it down. Trillions were printed and injected directly into the economy as well as the stock market causing currency devaluation. That combined with supply chain disruption scarcity caused inflation in resource demand. That inflation at the beginning of the supply chain was always going to end up at at the consumer end with rising living costs. The central banks are now reacting to that by raising rates to combat it. Rising rates are not good for ‘growth’ assets linked to debt. However long the above process takes to happen could be anyones guess, but the eventual endpoint is certain going by historical data. The projection of the Fed now raising rates faster than expected is confirmation we are now in the third part of the above.