Are MN homeowners as deluded as HPCers?

[Cybercynic]

Last few days there has been spike in the number of posts on potential house price declines. In the UK prices have already dipped more than 3% since August. I find it amusing that many HPCers are frequenting MN to report such news and potentially express glee on those that have bought.

However, even more amusing is the response of home owners suggesting how prickly they are to the remote possibility of house price declines. (PS: I am a homeowner and bought 20 years ago. While I have made equity gains over the years, I support overall declines in prices otherwise I feel my kids will be forever renting in this country).

While I hold no brief for doomsayers and think most of those are crazies, I believe the homeowners on this forum are turning increasingly prickly at facts and they offer the following standard responses to prospect of price reductions:

Response#1: House is not an investment it is a home. OR if you buy for long term you will always be okay

Counter: Ok then stop worrying about what doomsayers say. Let the prices decline by 10-25% and be okay with it.

Response#2: UK prices will never go down because it is an island and we just 'love' immigration

Counter: Please check out what is happening in Australia and New Zealand. Both factors apply there and they already have >10% yearly declines so far and more is expected

Response#3: If prices decline I will simply refuse to sell. Nobody can force me to sell.

Counter: Yes, you don’t need to sell because you can refuse to participate in the market. However, that does not stop price decline just as prices went up even when you refused to sell your own property in a rising market. House prices are determined at margins. Valuations are based on comparable transactions (whether you sell or nor). Unless there is a sellers strike announced similar to the train strike next week, not sure how this argument stands.

Response#4: There wont be any re-possessions

Counter: Agreed there will be few repossessions. It takes a long time to repossess and therefore, Banks will work with borrowers to find ways to make sure homes are not taken away. But one does not need forced sales to price declines. Australia, Canada, New Zealand, Sweden have all seen declines in the last 1 year without repossessions. And as I said earlier, UK has had declines >3% since Aug. And we are not even in recession yet officially. House prices are a function of affordability and I for one do think that era of <1% interest rate is over and average will hover around 4-5% for some time and with those rates you cannot have rapid growth.

Response#5: If one hopes for price reductions throughout, one must be a horrible person 'cause some people will feel pain

Counter: HPI has caused more pain to generations. And therefore, please explain a situation when we can have affordable housing without price declines. Affordability either comes with consistent wage growth and that aint happening without rampant inflation and resulting interest rate increases. So please let us know what advise they have for the younger generation to become home owners and who want affordable housing. And please do not suggest council housing since you will need to first check the govt finances to make that suggestion

House construction has stopped here. Land insanely expensive, construction materials too high. NIMBY councillors sitting on planning applications for their constituents.

Yes I have noticed it. Both sides are pretty deluded.

Houses are still going up in price where I am. It’s insane.

But regardless… what advise they have for the younger generation to become home owners and who want affordable housing

that isn’t what is likely to happen. It’s far more likely that we’re having, and will continue to have, an uncomfortable cultural shift where people will need to accept that most people won’t be homeowners. It’s the case in a lot of countries. We have a sense of almost entitlement here, that everyone will be able to afford to own a nice house, and it’s not the case. That’s why there is so much talk about rental reforms, and price caps, and generally making the rental market more fit for purpose. It’s needed, because it’s going to be much more common to be renting for long periods than to buy.

People don’t want affordable housing, either. There’s estates all over the country that are packed with housing and don’t sell despite reductions. Mostly because they are in rubbish locations, or have poor connectivity. People want specific houses, cheaper. If people just wanted to be on the housing ladder, they’d have flooded into the thousands of lovely flats available after the pandemic, and lived happily in them until they appreciated. The ones around me were largely snapped up by developers who have now sold them for massive profit.

I haven't seen this either.

Prices go up and down but generally have crept upwards over the last 200 years.
Most homeowners will sit it out, others may struggle and need to extend terms, some ftbs will find it easier.

It's hardly a surprise.

I’ve not seen much of this. Surely most people are buying a home, not an investment, and understand that paper gains are meaningless.

A lot don't think like this, though they should. Look at any threads where people talk about putting in a lower offer.

I don't mind losing money off my house value. I have dc & the current system is crap. Higher interest rates are better for the economy & I would like my dc to see more wage growth.

where I am prices are dropping. Of course they are because debt is so much more expensive.

I know, who can be arsed to care so much what anonymous people on the internet think about the movement of house prices?

well why do you care?

I'm not sure why you've made this thread. It whiffs of bitterness tbh as if you're upset people aren't crying over price drops.

Why would it make you happy for people to be more upset about it? That's honestly quite worrying.

From my perspective it would be nice if there was a drop in property prices as we are almost mortgage free but in a very small house. If prices dropped where we are we could potentially upsize. Sorry if that isn't what you want to hear 💐

I think whether prices rise or fall will depend on demand - in areas where people want to live and where there's not much on the market at any given time, prices won't drop that much. In places which are less popular or where there is loads of new developments, maybe they will.

For homeowners it only matters what the value is, when you want to move. If you are staying put and can afford the mortgage it's all just theoretical value anyway.

Houses were crazy high for years. We need them to be a lot cheaper so our kids can afford somewhere to live.

I agree, I have not seen any of this. I am a home owner, and my house is my home, not an investment. According to you feeling like that makes me combative and defensive. I dont see how, but I dont care what you think. I'm not arguing with you, you are arguing with yourself

I'm not sure why you've made this thread. It whiffs of bitterness tbh as if you're upset people aren't crying over price drops.

proof of the batshit on these types of threads.

Response#6 I find X position very amusing.

Counter No you don't. You simply disagree with it, but think that you sound more lofty and erudite if you pretend to find it amusing.

Handy hint Nobody is fooled by this tactic (apart from those who only stumbled across the internet in the last couple of days, and maybe not even them).

@JesusInTheCabbageVan Great Secret Tactic. I will sound erudite because I will use the word 'erudite' in my post. Great Job.

Look, you are hoping house prices will go down, and you don't like to hear otherwise, and you would like to "prove" that you are right by mocking opinions you don't share.

The truth is nobody is able to predict what will happen. Everyone is guessing. Just write it on a piece of paper and in 10 years you will know whether you were right or not.

Also, where Air BnB has influenced house prices, it's reversible if a government or even local authority decides to make legislative/tax changes to deter this practice..

I think tbh, this is going to be one of those arguments which can't be won. It you disagree with the op you're "batshit" (ie mentally unwell to the point of being delusional). If you say you're not upset about price drops in property, you're combative and defensive. So.. OH MY GOD IM SOOOOO UPSET. I CAN'T SLEEP. I CAN'T EAT. THE PROPERTY PRICES NOOOOOOOOOOOO!!!!! I HAVE LITERALLY GONE BATSHIT CRAZY. The fact I'm mortgage free means nothing, NOTHING as I just can't cope with the 3% drop. {Waaaaaaaaaiiiiiiiiillllllllllll, stamp feet, scream}

is that ok for you @bibbif ?

Fwiw, I also have DCs who I would prefer not to house till I die, so I'm fine with the system changing. But I'm probably not allowed to say that because I'm either mentally ill or combative and defensive if it do so, I'd say this conversation is dead in the water.

I guess you forgot to read in detail my post. It just exposes the defensiveness of both doomsayers and people like yourself. Nowhere did I say I want more people to be upset. I just pointed out both sides are hypocritical. Do not project your own bitterness on to others.

I read your op. You stated you were "amused" by responses to comments that property was losing value. As jesus advised, that isn't a particularly brilliant tactic. It makes you sound goady and unpleasant (and not erudite, as already mentioned)

Oh yes, let me club anyone with a contrarian view point and criticise them. Try better next time.

Response#1: House is not an investment it is a home. OR if you buy for long term you will always be okay

Counter: Ok then stop worrying about what doomsayers say. Let the prices decline by 10-25% and be okay with it.

Response #1 tends to be mine and your counter doesn't really make any sense. I am a homeowner who sees my house as a home. I don't need to LET the prices decline. I have as much control over the market as anyone else. If they go down they go down, if they go up they go up. Why do you need a counter argument against my statement?

A long post OP, but really saying very little. In this country surely people realise there is an upward trajectory, but the property market is due to hit dips and problems along the way. The history of house prices is easy to locate to study.

Homeowners this last decade have been blessed on the whole; prices predicted to rank after brexit - didn’t happen. Prices predicted to tank during covid. Didn’t happen, quite the reverse.

some sort of market correction is way overdue, and I think people who expect house prices to climb steeply are in short supply.

overall the HPC site posters are the idiots: if they had bought when the site started - around 2004? - they could have almost paid off a mortgage and on the way to an unencumbered roof over their heads. Too busy shouting “crashy crashy” and hoping the general housowning population came to a sticky end, waiting for a devastating crash that didn’t happen. More fool them.

Drop in the short term, always make long term. Sold a distant deceased relative’s house recently, bought for £2K(!) in the 60s. Went for £600K this year.

@Notonyournellykelly I'm not sure what you are going on about? I literally posted saying I don't mind my house losing value...

Drop in the short term, always make long term. Sold a distant deceased relative’s house recently, bought for £2K(!) in the 60s. Went for £600K this year.

I agree but in London at least & particularly with flats growth has been much slower in recent years.