2006-11-20 08:32:42 · 15 answers · asked by Anonymous in Business & Finance ➔ Renting & Real Estate
According to this website: http://www.thisismoney.co.uk/mortgages/house-prices/article.html?in_article_id=406526&in_page_id=57
house prices are likely to crash because many houses are 20% overvalued.
2006-11-20 08:48:24 · update #1
In the UK it has been discussed that this may indeed happen. However, I expect prices to drop, perhaps dramatically in some areas, while other areas will experience slight depreciation.
In the USA I expect to see prices drop further in many markets. Currently, there is a lot of talk that prices have "evened" out. However, IMO this is a physolocial band aid with the hope to "hold" things together so many over invested people will not go bankrupt.
Foreclosures continue to increase. People bought due to the fear of loosing their dream of home ownership. Many of these good folks over financed themselves and the evil interest rate is knocking at their doors.
Other people bought simply out of the desire to make their "millions" in real estate and got out. Many did make millions - yeah for them. Others have got caught holding the bag. It was due to happen sometime.
Some markets, like the Pacific Northwest will most likely not experience as drastic price drop as other areas, due to the continued flow of people flocking to live here. For my sake, I hope prices do drop dramatically - so I can more house!
2006-11-20 10:33:19 · answer #1 · answered by Ms. Balls 3 · 0⤊ 0⤋
Very unlikely - in the Uk at any rate.
Record population level
Record housing shortgage
Record immigration
Record birth rates
Lowest ever land availability
Taking the basic laws of supply and demand, I suspect other than the odd theoretical glitch, there is only one way houses prices are going to go - and it isn't down.
Kevin has a point - we don't KNOW - in much the same way as we do not know if we will be run over tomorrow crossing the street. We are however able to make an educated guess - and if you sraw a strigh line between house prices now and house prices pre-war. you will find that the true figures do not fluctuate all that much around the line.
Very roughly, ever 5-8 years house prices double. Now mortgage lenders are allowing 5x income and 4 x double income, there is plenty of options now for enough people to get mortages that developers can seel as many as they make. WHY would house prices come down?
**UPDATE**
I read the article you linked to, basically whatever happens they can say they said so - they are hedgine so much. "Cannot rule out a crash but the market will probably increase x %"
Most of these websites keep predicting crashes of one type or another, I guess one year or another, they will get lucky and get it right.
If anyone REALLY thinks house prices are imminently going to drop 20% needs to sell their home, rent for a few months and then buy somewhere after the prices have crashed - and enjoy a nicer house WITH a good few thousand spending money left over as well. I wonder if anyone is confident enough in their "crash imminent" prediction to actually put their house where their mouth is.
And before anyone asks, yes I do put my money where my mouth is, which is why I have no intention of letting any of my buy2lets go and if the right deal present itself, I am quite happy to keep investing.
2006-11-20 08:35:30 · answer #2 · answered by Mark T 6 · 0⤊ 0⤋
In october the monetary employer of england set prices of interest at 5% the optimal they have been in a minimum of three years. larger prices of interest potential you should pay extra decrease back on a 25,000 mortgage or 100,000 loan than you probably did in september, on authentic of this 5% loan organizations upload a small percentage with a purpose to make income. With severe residing house expenditures and mortgages 'extra severe priced' how will anybody get on the sources ladder? If there's a sluggish contained in the decrease end of the marketplace (lower than £250k) then that is likely that a droop in residing house expenditures will keep on with, how tremendous a fall relies upon on inflation, if inflation is at 2.4%+ (2.0% authorities purpose) for the subsequent quarter than products may get extra severe priced, the decision for for this stuff will replace and undemanding people may have a lot less funds of their hand on the end of the month. What the authorities and/or the monetary employer of england settle on to do contained in the subsequent quarter will also impact how low-priced mortgages are. yet presently a fall in residing house expenditures is rather conceivable.
2016-11-29 07:49:58 · answer #3 · answered by crabtree 3 · 0⤊ 0⤋
Crash from what??Ho yea over inflation. I say that home price will drop to 40-60% of what they were last year. They really are not dropping they are correcting. From what you may ask a over inflated bubble that was made. Hear is how they made it.
http://www.breakingbubble.com/index.htm...
I sure find it funny that you get answer like,
I'll just check my crystal ball... ,
anyone who tells you they know the answer to this is a fool or a liar. But at the same time they know there will not be a crash but a SOFT landing. or it is just cooling, what nice spin Stop talking out of both side of your mouth, Do you not realize that you losing what little credibility that you may have since the drop inf self evident.
2006-11-20 11:13:53 · answer #4 · answered by Anonymous · 0⤊ 1⤋
They were agonising about this in 1976, as I recall. Of course house prices can go down as well as up. But the general trend is always upwards.
Don't ever expect to make money from buying and selling houses though. Only buy what you need, and don't borrow too much money. Remember- a house is just a machine for living in. Don't think you "have to get on the ladder" - the whole house buying scene is one big con.
2006-11-20 08:37:00 · answer #5 · answered by Not Ecky Boy 6 · 1⤊ 1⤋
No!wait for the next rate rise and House prices might slow down
2006-11-20 08:55:11 · answer #6 · answered by Redmonk 6 · 1⤊ 0⤋
No, but they are going down. It is a natural settling from an overheated market. There is a big difference between a soft landing, which we are experiencing, and a crash.
2006-11-20 08:39:26 · answer #7 · answered by Anonymous · 0⤊ 0⤋
I dont believe they are about to crash - just even out, unless you are looking at commercial property. Residential looks like it may stagnate but hold tight with the next election things may change
2006-11-20 08:41:20 · answer #8 · answered by Never Forever 1 · 0⤊ 0⤋
With the tax and spend liberals about to take power YES THEY ARE. You'd better ditch that adjustable rate or interest only loan before rate hit the double digits.
2006-11-20 08:40:45 · answer #9 · answered by Anonymous · 0⤊ 0⤋
Prices here in Northern Ireland are 'going through the roof' and no sign of it stopping.
2006-11-20 10:52:30 · answer #10 · answered by Anonymous · 0⤊ 0⤋