What is going to happen to the housing market in the UK in the next 5 years?

Question

I would like to know what would be the best kind of investment over the next five years (would'ent we all!) housing stocks and shares or savings.

Answer 1

I think it's tail off, it cant continue loike this. I have made £120k in 10 years on my little 2 bed house.

I'd not bother buying a house at present, wait until prices stop rising so much, you could end up with negative equity

Answer 2

House prices will drop or sales will slow right down. Commodities will rise, this means oil (up to $100 a drum predicted) , precious metals and also soft commodities.

Soft commodities are grains and other raw foods and dairy products not to forget orange juice etc. The reason for increase is down to the needs of China. Some weather has also had an influence in terms of floods and heatwaves destroying crops.

Our shopping in general will increase by Septemeber this year, for all the above reasons

Answer 3

Savings >> Shares ..

The stock markets are undergoing a 'correction' .. it's not unreasonable to expect a 15% to 20% drop over the next few years ..

However markets ALWAYS recover .. so the next few years will present those with cash some ideal opportunities to buy cheap !!!

I suggest you focus on banks = they are being 'punished' more than most, so should present some really good bargains ..

Answer 4

Predicting markets, like any other is a difficult task and even the most astute investor can get it wrong. The housing market in the UK has seen tremendous growth. This has been fueled largely by interest rates which have been low for many years. Low interest rates cause money borrowed to be cheaper.

Interest rates like any other move in "cycles" just as the moon and tides ebb and flow. If interests rates are low my prediction would be that there is only one direction they will move - up. One of the main economic instruments governments use for controlling inflationary pressures in the economy are interest rates. Due to a buoyant economy and high fuel prices plus increases in commodities this is helping to fuel inflation. The government will pre-empt this with interest rate rises. When they do this will undoutedly affect house prices.

As previously stated markets move in cycles. As house prices continue to be pushed higher there is a correlation between supply and demand. Once a certain point is reached less and less money chases the property market. The result? House prices fall.

The long term trend of property is upwards but before house prices begin their relentless upward trend they will move back. When they do they will be seen as more attractive to buyers, investors and speculators. When they money flows back in this will push them up again.

So, medium term I think a pull back and this tends to be the general consensus of opinion amongst the real estate fraternity. However, they do get it wrong!

The best investment over the nexy few years, although not without risk, will be gold. This is due to demand from China and Russia who are seeking to diversify assets from a crumbling US dollar. Further factors such as inflation, tensions in the Middle East and lack of output are adding to the gold rush.

This article may be of interest to you:

http://www.busrep.co.za/index.php?fArticleId=3733599&fSectionId=630&fSetId=662

Good luck and hope this helps!

Answer 5

All of Europe has been booming financially for up to 10 years, I am no money expert but even I expect things to slow up. If people are buying houses for up to 10 times their annual salary instead of three the warning lights come on. It has to slow down if not crash. Like others have said I would not consider buying a house at the moment, give it 2 years to do what itis going to do and settle.

Answer 6

No one knows! We don't know what's around the corner, just look at the recent flooding for example. Now there are thousands of people living in areas vulnerable to severe flooding. Many will be wanting to sell up and move but who would buy their property? Also there is the factor of higher insurance on properties. We will have to wait and see if this has a knock-on effect on house prices nationally or locally.

Answer 7

The housing market is cyclical and we are at the top.
Prices collapse when one or both of the following happen: interest rates rise faster than wages and mortgages cannot be serviced; supply outstrips demand and buyers dry up as the salary/mortgage ratio becomes out of synch [negatively].
Cash will remain king for the forseeable future as stock markets are in that 'nervous ' stage.

Answer 8

I would go for savings now and keep your eye on the markets. House prices seem artificially high to me and you could make hugh losses if they really tumble although everyone says its not likely. Interest rates are up. Go for the savings in the short term.

Answer 9

no you will reliably are looking forward to what's going to take place interior the housing industry at any time. the fees could crash with the aid of 40% or they might upward push with the aid of 25%. Who knows? yet, it probable is risk-free to declare that sources will proceed to be a competent investment and that the final trend will constantly be "up" - perhaps with some "downs" alongside the way nevertheless, yet no longer something to get too alarmed approximately.

Answer 10

It will probably drop sharply at some point in the next five years - but that's leaving a lot of room - the question is when ?