House Prices

[LGBirmingham]

House prices still seem to be rising? Does anyone else think this?

I am very much against government subsidizing homeowners. Because it tends to also inflate house prices. And high housing costs are bad for society.

Take help to buy, it inflated the cost of new builds, lined the pockets of homebuilders and landed people in a right mess when interest rates started rising and they couldn't afford what they bought.

These schemes might benefit some individuals, but they encourage you to take on debt you might never be able to pay off. And they encourage house price inflation, which is bad for young people.

That should take all this money and invest it in social housing. Which is much better for society in general.

I find the desperate attempts by some posters to flag anything that seems to say reality isn`t going to happen quite sad actually, the idea that the Welsh government could somehow influence the outcomes caused by global credit markets and interest rates turning full circle is just laughable really.

Im willing to bet that the Welsh scheme doesnt inflate house prices, LOL, in fact I think it will be shelved down the road somewhere when they can`t raise the extra money, if they try to raise the money from property taxes that will just cause a sell off and even steeper house price drops. People who borrowed too much will eventually have to face the Piper, better to just get it out of the way quickly IMO.

Hope you're not referring to me Crashy 😢

I'm certainly not wishing to imply that the Welsh government can influence the outcomes caused by global credit markets. Tbh I doubt they could influence a piss up in a brewery let alone organise one!

https://www.plumplot.co.uk/London-property-transactions.html

Lets agree that they could probably take part in a piss up in a brewery if someone else organised it.

ok

What do you mean by 'reality isn't going to happen' @CrashyTime ? It's a genuine question, I have no strong opinions about whether there will be a crash or not although my personally opinion is that it will be more of a dip than a crash there are no guarantees. I notice you're firmly on the side of crash and I wondered what you meant from 'reality'? Surely no-one really knows until it happens, even financial experts, the government or BoE?

Reality is that borrowing costs have gone up quite a lot very fast, that reality.

You're probably right @CrashyTime that whatever happens to the Welsh scheme to support homeowners won't have any effect on UK house prices. But it sets a bad precedent and wastes money that could be spent much better.

I think we can all agree that's reality but how does it explain your phrase "reality isn't going to happen" - I'm also curious.

What isn't going to happen?

The effects of 200k people a month coming off trackers next year, the effects of a recession and higher borrowing costs on BTL, AirBnB, FTB`ers etc. I think you already know what I mean?

https://www.theguardian.com/money/2023/jun/17/uk-homeowners-face-huge-rise-in-payments-when-fixed-rate-mortgages-expire

@Callisto1 "High housing costs are bad for society." Completely agree. High house prices (without equivalent wage growth) do far more harm than good. If your housing cost takes up a large part of your income you have less money to put back into the economy by spending it on goods and services, supporting small businesses, which results in job losses in those industries. You have less money to invest into entrepreneurial endeavours. It stifles innovation and productivity because people are less willing to take risks to start their own businesses or try new things.

People complain about cost of living, but the biggest cost to most of us is our housing. And the solution isn't to cut interest rates which negatively impacts savers and drives prices up higher, making the problem worse. It's reducing prices. House price gains aren't even real money unless you downsize or move to a cheaper area, and it just makes the next step up more expensive. But I suppose it makes people feel good to think "my house is worth x".

Even in your uncommon rental example, buying is still the better option.

Not only financially but security wise.

Paying rent is wasted money.

This is what all the people coming off fixes this year and next told themselves, wonder if they still believe it?

Exactly, the best thing by far for ordinary people is cheap housing, of course this doesn`t work too well at banker bonus time so there is a LOT of powerful resistance to this happening (not least a lot of sheep still brainwashed enough to think it is good for housing to be unaffordable for some ungodly reason!) hopefully the bond market will eat them all for breakfast some day soon, a very good start has been made with commercial property where many of the big players are getting their arses handed to them on their office space bets.

https://www.bbc.co.uk/news/business-67316150

I think the people who were supposed to fill the seats next to the girl on her laptop are WFH?

London is special. We can't take <50% down in London and apply it to the rest of the UK.

Interest rates will more than likely be down to around 1.5 to 3% as a norm. The rate see are seeing at moment are purely due to inflation from pandemic

https://www.plumplot.co.uk/Tyne-and-Wear-property-transactions.html

Quickly pop over to the 6% interest rate thread. I think you may be disappointed.

Oooh, you're really working hard today, arencha Crashy?

Now show me some stats on a more affluent area please.

Umm. Bedfordshire?

https://www.plumplot.co.uk/Bedfordshire-property-transactions.html

There was a quote from some Scottish writer cant remember who at the moment, came from a tough background, I dont even think the quote was original to him - "Intelligence doesnt just turn up in specific areas, it falls like snow covering everywhere in nearly equal measure, there are kids in Easterhouse with IQs every bit as high as kids in Bearsden"

The same applies to cheap credit withdrawal, EVERYWHERE sucked up the cheap debt tokens, everywhere gets hit as the goodie bag is taken away.

@CrashyTime what's your prediction of the fall of the average price from peak August 2022? And when do you think the bottom will be? Out of curiosity

@Lm1981 I think a lot of people are hoping what you are thinking there... can't see it happening tbh

Long term BOE rates down to zero again? That's highly unlikely.
Likely to remain 3-4% (BOE rates, not mortgage rates) at least and possibly much higher depending on what happens economically.