It starts with people only moving if they have to. E.g deaths and divorce. So the market slows.
it will stop banks lending money so no remortgages no new purchases unless your a cash buyer (I’ll come back to them). Which grinds the housing market to a halt.
- it was this point the government intervened last time.
people in buy to let’s may find landlords using their rent to pay off their own mortgages rather than the properties. And the first the renter will hear us bailiffs at the door.
businesses will struggle to cover their bills as fewer people will be spending money. Redundancies follow. Which feeds it further, bankruptcy follow. More repossessions.
raised crime levels as people struggle to put food on the table. Children hungry at schools and older ones not attending school as they can’t afford yo get there /uniform/ £1 for the school books. Older ones may feel responsible for helping the family, so working or committing crimes to help the family. Any remaining youth centres closing due to less money in the governments pot
neglected health issues due to poor nutrition and being able to take time off work for doctors.
back to the cash buyers.
we are living in a weird parallel world. Some people are incredibly wealthy at the moment. They are the ones who are going to benefit. Generally older, seen it all before. Property owned outright. Any drop means they can clean up. Buy whole chunks of property at reduced rates to rent out. Suddenly their property portfolio is booming. As they know property will recover and they will make a killing.
whilst We do need a readjustment it needs to be slow and steady. A crash means no one but the wealthy will benefit and it will be over in a blink back to mad times again. There’s millions of FTB waiting for their chance. A crash won’t help them.