in light of the interest rate increases and inflation, do you see a bullish outlook for the UK housing market? Would you invest in an off plan property due for completion in 2008? Do you see sustained growth, reduced groth or a crash & burn?
2007-01-18 03:03:07 · 10 answers · asked by Anonymous in Business & Finance ➔ Renting & Real Estate
Not sure how it is on that side of the pond. Hear i think it will crash and burn for one reason fraud. I do not think that the housing market hear is fair and very misleading.
This web site tell how they made a big scam and one thing about money is if the is a scam there will always be a crash.
http://www.breakingbubble.com/index.htm
2007-01-18 09:22:35 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Jay,
You are looking at buying a unit in a specific development in a specific city built by a specific company. There are a lot of reasons why that one deal could do better or worse than the average for the area. Note also that the UK does not go up or down as a whole. Last year London saw some large rises while much of the East Midlands did not. If you compare specific properties you would find exceptions in each market.
What are you expecting to do with the property when it completes? If you are thinking you will be flipping it what will happen if the value has not risen? If you expect to complete and then move in can you get a loan commitment now? Unlikely if we are talking over a year away. Hence your situation could change and the risk to the deal is high even if the value was to rise.
Best to get a great deal on the way in and make sure that the value is truly there and not just a value that was inflated so that the developer can offer a discount. Expect that you will need to complete on the deal and hold it for a while (years) before you sell. That way you can avoid having to sell if the market is down for a period.
You are somewhat gambling on the future market conditions. More so if you need to exit before completion. Less so if you can afford to hold as long as is needed for the investment to make sense.
I am not saying to avoid off-plan. I have purchased 5 properties around the UK off-plan. I am cautioning your against pure speculation if you can not afford to complete and then hold.
2007-01-18 13:50:50 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Crash, and in a big way. But more than likely not long after 2008
I work in a bank and witnessed the start of this house price boom, which was mainly caused by the fact the base rate sank fast to around 3%. The influx of television programs advising people they can make big money from buying 2nd properties on 'buy-to-let' schemes helped fuel the frenzy, as well as immigration our stripping the rate of new property development.
But their has been property booms before, with crashes following not long after (see: http://www.housepricecrash.co.uk/).
The current financial climate is getting quite simaler to the 90's, with interest rates now rising (currently 5.25%), inflation is 3% , country is spending millions on the Iraq war and immigration is getting tighter - apparently. Add that to the fact we are more than likely on the cusp of another Tory government (who were in when prices crashed last time) I don't hold much hope for future prices.
2007-01-18 13:44:47 · answer #3 · answered by glenn r 2 · 0⤊ 0⤋
I feel the market will stabilize in the next few years. Prices are too high and demand is weaker due to interest rates and affordability. I think prices will increase at the rate of inflation after the market stabilizes. I would wait till 2008 to purchase the property or ask for a discounted price now.
2007-01-18 13:32:54 · answer #4 · answered by tianaramal 4 · 0⤊ 0⤋
I am hoping the house pricing is going to go down! As I want a house! If you look at history the last time they had inflation like this there was a big resession, but its unlikely to happen in the same way again. But afford able first time buyer houses would be good. Also people shouln't be able to have more than two houses!
2007-01-18 11:12:38 · answer #5 · answered by Lisa G 3 · 0⤊ 0⤋
5-8% growth per year seems to be the concensus in the outlook surveys.
People have made enough to have equity in property for a crash to be unlikely, they can afford to stay put. Crash would only happen if there were major interest rate rises and recession causing buying power drop and negative equity quick sales.
unlikely to happen with de-coupled interest rate control
2007-01-18 11:15:06 · answer #6 · answered by Michael H 7 · 0⤊ 0⤋
My personal opinion is they will remain flat the next couple years and then start rising.
That assumes interest rates stay relatively stable. If rates rise significantly driving buyers away prices may fall more but eventually demand will return.
2007-01-18 11:11:20 · answer #7 · answered by Anonymous · 0⤊ 0⤋
I live in hope that the interest rates will fall and that the property market will prosper and make me money on the flat i bought in july last year........but who knows!!
2007-01-18 11:07:35 · answer #8 · answered by J9 3 · 0⤊ 0⤋
hope the prices keep on the up but really could do with the intrest rates fallin a big bit
2007-01-18 11:12:12 · answer #9 · answered by Anonymous · 0⤊ 0⤋
sustained growth, REITs will increase demand.
2007-01-18 12:58:07 · answer #10 · answered by Anonymous · 0⤊ 0⤋