Can’t wait for the big crash

[HPcrashingdown]

I can’t wait for prices to come back down. It’s absolutely ridiculous how mental prices have gone. I will be just waiting with my hefty deposit ready to buy my forever home. It will be great.

I'm not too worried...he never replies to me anyway.

Or at least DeadHouseBounce never used to ... @deadhighbungalow might be completely different 😂

Report the post then as I already said. It's telling how you ignore everything else in the post.

@Mark19735 I am really not interested in any personal details. You did state that you had a property portfolio on a different thread. Probably a fantasy.
As I already said, you seem obsessed with HPC forum. If what you say is true, there really is no reason for you to be on there so frequently nor referring to them on here constantly. Something doesn't quite add up to me but, as I said, I am not interested in your personal life or situation.

There isn't anything else to discuss as it is quite apparent that we have different opinions.
We can chat in another year or better still two and see what has happened in the interim.

Why "better still, two"? Losing your nerve?

A normal person might say that having different opinions is precisely why there is something to discuss. Just sayin'

I've never stated I have a portfolio, on this or any other thread. From time to time I might use a strawman argument, of the form "if I were a BTL investor, I'd do X, Y, or Z with my portfolio" but anyone who reads carefully with an interest in understanding would recognise that as being quite different to saying "I definitely have a portfolio of properties". But not everyone reads carefully, or has an interest in understanding, it seems.

I’m not convinced there will be a crash. Halifax reporting a rise in house prices this months due to mortgage rates reducing and stabilising. It’ll probably be rocky for a bit with some falls then maybe stagnant for a bit then rise again once wages have caught up. Anyone waiting for a huge crash is probably going to be disappointed.

I'm not expecting a crash either but Halifax also said that the trend was downwards.

They can also only attest to their 15% share of house sales, and even then they don't include cash sales.

Nationwide saying prices dropped during the same month, for the sixth month in a row.

Three national housebuilders issued profit warnings and announced they'd be building 25% fewer houses, a hiring freeze, threat of redundancies.

Shares in all things property-related are tanking, which I think is a good barometer because cleverer people than me have read all available data and acted.

I think it'll be rocky for some time yet.

@Mark19735
Why "better still, two"? Losing your nerve?
Not at all. This is nothing to do with nerve but with data and analysis imo. Unless there is massive intervention from the government/ hyperinflation, I expect prices to have fallen more in two years than one and, of course, data lags considerably.

Everything has already been discussed so there is really no more to be said to you. Perhaps your friends on HPC can continue the chat with you.

I don’t report posts, can’t be bothered. I know Mumsnet allow personal insults because I see them all over the site. Doesn’t make it a good argument though when you resort to personal attacks against someone who is trying to engage in an honest debate, & not making inflammatory comments

If prices fall then it might not help all ftb’s as mortgage companies then restrict lending but for those that can get a mortgage it makes things more affordable.

For those in their forever home or those who aren’t intending to move in the next few years then as long as they can afford the extra interest on the mortgage it doesn’t matter if their home loses or even gains in value as it is hypothetical.

For those with a home they are looking to sell and buy a more expensive property a falling house market means their next purchase would be cheaper. They might even end up with a much better property than they thought they could get.

Whilst property prices might have been a bit rocky and then stabilised a little I think the back log of people who were going to move/marry/divorce and got stuck because of Covid accounted for the flurry of rising house prices.
On top of that I think we were due a price rise because no one knew how Brexit was going to affect everything and people had not moved and I think without Covid we would have seen the flurry in 2020.

Now we have the Russian invasion of a European country which in itself makes people more nervous as well as the knock on effect of Putins war with fuel prices which affects the price of everything that is bought and sold. The remnants of Covid, Rising inflation (see above. fuel prices) means interest rates go up which makes mortgages costlier.
Until something stops then it will be a continued cause and effect.

The U.K. isn’t the US though and it isn’t some Ponzi scheme making house prices go up it is simple supply and demand.
Population is going up. We are a tiny country compared to the US with more people per square km than the US.
People have to live somewhere and house building isn’t keeping up with demand so house prices overall will go up.

There will be some price falls but judging by previous decades prices don’t tend to fall below the previous peak.

If you read the threads on here though anyone would think that no young person will ever be able to buy a place of their own and it is all doom and gloom yet young people are buying. People on minimum wage are buying.

Population - natural population - will begin to fall from 2025, 20 years earlier than forecast.

And the huge recent price increases are less about supply and demand than they are about the artificially low cost of credit, which is coming to an end.

I don't want or see a significant crash, but a gradual correction would be beneficial or at least neutral to most people imo.

Why can't the correction come in the form of increased wages? That would help everyone. New buyers could afford houses at current prices. People who recently bought would find making their existing mortgage payments more comfortable.

That's the dichotomy. Some people want to do more, make more, earn more and get on in life that way (requires personal accountability and effort) whilst others want everybody else to suffer so that they can benefit at their expense (requires no personal accountability or effort).

I'm all for a correction. House prices stagnate, wages rise faster than house prices, houses relative to earnings correct. Simples.

@Mark19735

I agree that stagnation would be best, but if everybody's wages increase, then this will increase demand.

Given that property is in finite supply, then wage increases just mean more competition and higher prices surely?

'If you read the threads on here though anyone would think that no young person will ever be able to buy a place of their own and it is all doom and gloom yet young people are buying. People on minimum wage are buying.'

Sadly, this isn't all that accurate. The reality is that many younger people are unable to buy or unable to move into a larger property which they need for a family and are stuck. People on the minimum wage aren't able to buy unless they have a partner earning much more, a large parental gift or live in a cheap area.

I found this really sad, particularly the comment below:

As @Donotgogentle recent increases in house prices have been directly related to lose lending (1990s-early 2000s) and ZIRP/ QE since 2008. The later phase has changed and the brakes have been applied to credit.

@rainingsnoring

I think it depends on what you class as 'young people'.

Everyone I know in their early 30s has either bought, or is in the process of buying. Of course some people will never be able to afford to get on the ladder, but that's always been the case.

I think it is harder for people in their 20s to buy, but that's partly because jobs are less stable, and they spend longer in education. My parents generation were out earning at 15 or 16, whereas now they are at uni getting into debt until 21 or 22. They will still get on the ladder, it just takes longer.

@StarrySki It's undoubtedly much harder for people in their 20s and 30s to buy compared to previous generations. It's a well recognised fact that home ownership has reduced in younger age groups, house prices have risen relative to incomes to the highest levels (average of 9 times household income compared to 3-4 historically and often only one salary in the past) and that people are forced to take on higher levels of debt than previous generations or continue to rent which is often not a great choice either.

The education issue is a different topic and again something that younger people often feel forced to do in order to get 'better jobs' which would not have required a degree previously so they not only get into debt but also start working later and will have to continue to work in longer in older age. As you say, there is also not the same jobs stability that there was previously so they are disadvantaged in lots of ways.

@rainingsnoring

It's true that house prices have risen much faster than wages, but I think that has a lot to do with the fact that prices are now based on two salaries rather than one.

In the past, women either didn't work, or were paid low wages, so house prices were based on one man's salary. If you were a single female, then it was virtually impossible to buy.

Of course, the current situation causes all sorts of problems for single income households (single parents etc). I'm not saying it's right. However, it is still a better situation for single females than it was in the past, as they at least have a fair chance of getting on the ladder without a man.

If you take into account the fact that prices are based in two salaries, then the price to income ratio hasn't changed that much.

I feel lucky that as a millennial, I was able to buy my own home, without the help of a man.

My mother, who was a baby boomer, never would have been able to do this

It depends which generation you are talking about.
Several generations ago, yes but less so those in the 50s-80s with whom I am making a comparison.
I know/ knew (some now deceased) several women who would be in their mid 80-90 now who were single and managed to buy very decent houses on not v high salaries in relatively expensive areas so it clearly was possible.
I agree that the bank's lending criteria were much tighter previously. As you say, this is one major factor that has led to rises so the deregulation of lending (and lots of other financial services) has been to the detriment of younger people.
As far as I know, the income to house price ratio is based on household income so it really has risen massively and households are having to work harder, often with two earners and pay for childcare pretty often too.

Whenever I read about house price to income ratio, it's always based on 'average salary', but happy to be proven wrong.

I'm sure that some women in that generation were able to buy homes alone, but I think it was rare and definitely much harder for them than it is now. Now, I know loads of professional women in their late 20s and early 30s who own their own houses.

I would say that the housing situation is:

• pretty much the same for households with two full time salaries
• worse for single men, and for couples with only one full time salary
• better for single women

Things change, and and different groups of people benefit, or suffer as a result.

I think it is harder for people in their 20s to buy, but that's partly because jobs are less stable, and they spend longer in education. My parents generation were out earning at 15 or 16, whereas now they are at uni getting into debt until 21 or 22. They will still get on the ladder, it just takes longer

From the young people I know it is those that choose the Uni route who are struggling

The ones who went to college to do a trade and were out earning by 17 are the ones buying.
They are buying what they can afford and where they can afford. They aren’t looking for their forever home but for a place right now.
Some aren’t even living in the place as it isn’t anywhere near to where they work. They are just either making the place more attractive then selling or turning it into rental with a btl mortgage and getting another place to do up.

@StarrySki I suspect you are right that it is easier for single women to buy now but that is at least partly because more women are better educated and have better paid jobs and more remain single or settle down with a partner much later not in their early 20s. Having said that, most people (not professional high earners) buy with a partner still.

As far as couples go, it was undoubtedly much easier previously. In fact, a couple with one earner could buy a far bigger/ more desirable property on one income than a couple with two earners now. This is certainly the case in London/ SE/ SW at least and prices in other areas have risen an awful lot too.

I agree with @Kennykenkencat that being in a trade can be advantageous nowadays and lots of people with these skills have successfully done up properties to make some more money. Whether this works in a falling market remains to be seen, I guess.