The market wont crash as long as people want houses and there arent many houses.
Wouldn’t the term debt expansion be more accurate considering wages lagged price increases since 2008?
Having been though a few housing crashes.
First thing is that builders stop building the cost to build outweighed the price they can sell. This then puts supply and demand on the front foot. Cash rich buyers nab a bargain as people end up with negative equity and unable to meet mortgage payments and go bankrupt.
Uk Landlords sell up as the cost to them becomes to high and interest rates make more sense to put money in bank. This then creates a issue for the people that can’t afford the new interest rates and need to rent. The landlords that hang on can charge more.
The 80s crash was the grimmest thing I’ve seen outside covid. People just walked into the bank and handed the keys back to their homes. I fear if it got that bad we would see a massive increase in mental health issues and sadly suicide.
I like the way with these things it’s going to mysteriously end next-year, but for some reason not ‘this year’, like just about now.
The govt will clearly step in and prevent the repos etc.
Because God forbid people invest in something that doesn’t continually go up.
The real danger is corporate landlords swoop in and take all the cut price property
Tories leave, Labour comes in, housing market declines.
Labour get blamed
>On Wednesday, the average two-year fixed mortgage rate hit 6.46%, while the average five-year deal was 6.32%
>Soaring mortgage rates are pricing new buyers out of the market
>The knock-on effect of a slowing of house sales has been a significant surge in demand in the rental market
>Near-term expectations point to a further strong growth in rental prices
tldr: good time to be a cash buyer. 1st time buyers, you still aren’t getting on the housing ladder, enjoy higher rents.
House prices can’t go up forever, but the entire UK is basically leveraged on that happening, if it stops being true or there’s a real crash, that’s peoples retirement wiped out. It’s not pretty.
The housing stock in the UK is also in a terrible state. If an asset is increasing in value by as much as housing has been, there’s no incentive take care of it. That combined with agents who know they’ll let anything nearly instantly? There’s no regular maintenance being done.
If there’s some sort of return to rationality with UK housing, if it stops being seen as just an investment opportunity. A lot of really bad stuff will happen. Equally right now everyone is living in a rubbish home they can’t afford, so it’s not like this is better.
8 comments
A boom ending means a stabilisation not a crash.
The market wont crash as long as people want houses and there arent many houses.
Wouldn’t the term debt expansion be more accurate considering wages lagged price increases since 2008?
Having been though a few housing crashes.
First thing is that builders stop building the cost to build outweighed the price they can sell. This then puts supply and demand on the front foot. Cash rich buyers nab a bargain as people end up with negative equity and unable to meet mortgage payments and go bankrupt.
Uk Landlords sell up as the cost to them becomes to high and interest rates make more sense to put money in bank. This then creates a issue for the people that can’t afford the new interest rates and need to rent. The landlords that hang on can charge more.
The 80s crash was the grimmest thing I’ve seen outside covid. People just walked into the bank and handed the keys back to their homes. I fear if it got that bad we would see a massive increase in mental health issues and sadly suicide.
I like the way with these things it’s going to mysteriously end next-year, but for some reason not ‘this year’, like just about now.
The govt will clearly step in and prevent the repos etc.
Because God forbid people invest in something that doesn’t continually go up.
The real danger is corporate landlords swoop in and take all the cut price property
Tories leave, Labour comes in, housing market declines.
Labour get blamed
>On Wednesday, the average two-year fixed mortgage rate hit 6.46%, while the average five-year deal was 6.32%
>Soaring mortgage rates are pricing new buyers out of the market
>The knock-on effect of a slowing of house sales has been a significant surge in demand in the rental market
>Near-term expectations point to a further strong growth in rental prices
tldr: good time to be a cash buyer. 1st time buyers, you still aren’t getting on the housing ladder, enjoy higher rents.
House prices can’t go up forever, but the entire UK is basically leveraged on that happening, if it stops being true or there’s a real crash, that’s peoples retirement wiped out. It’s not pretty.
The housing stock in the UK is also in a terrible state. If an asset is increasing in value by as much as housing has been, there’s no incentive take care of it. That combined with agents who know they’ll let anything nearly instantly? There’s no regular maintenance being done.
If there’s some sort of return to rationality with UK housing, if it stops being seen as just an investment opportunity. A lot of really bad stuff will happen. Equally right now everyone is living in a rubbish home they can’t afford, so it’s not like this is better.