Lootman wrote:Mike4 wrote:Tara wrote:Last century a single person on average wage could afford to buy a detached house in any part of the UK with about 2 or 3 years of his wages. Now that figure is over 12 years of average wages.
The only reason the UK housing market has not collapsed by over 50% is because the BOE has very foolishly kept interest rates at about zero for the last 15 years. When interest rates start to rise to stop the runaway double digit inflation we are now seeing, the UK housing market will begin the collapse.
An eventual fall in UK house prices of 50% to 60% from the current levels would not be very surprising.
You are bialystock and I claim my five pounds.
(This is what he was saying in 1997, when he sold his 4 bed Westbourne Grove house for £300k expecting to buy it back in six months for £150k, for those who weren't on TMF when he turned up dissing everyone BTLing.)
Or go back further in time than that. I recall 40 years ago, just as I was buying my second home in London, someone telling me that house prices had become "insane" and would surely crash.
I bought the house anyway for £44,000. I no longer own it but it is now worth about a million. No doubt that is "insane" but who would bet on it being cheaper in another 40 years?
Well there are always plenty of wishful thinkers around, hence the launch of the website and forum
housepricecrash.co.uk which is still prattling on about house prices crashing now, 25 years after the 50% fall they initially forecast back in the late 90s never happened. They have the same relentless bearishness on house prices on the front page of their website today as there was 20+ years ago.
The odd thing I notice though is the way people like you and me get characterised by the house price crashers as believing prices will only ever go up for ever, which is patently not the case. My own position is that I see are there are upward pressures on house prices (relentless population growth, government
fear of allowing a price crash and planning restrictions on new building). These pressures make the 50%-60% crash suggested by Tara above, unlikely. I still think my original decision to build a property portfolio 25 years ago was a good one, and I'm keeping it as I still see the same or similar pressures so to an extent I'm talking my own book, just as the HPCers hoping to buy a cheap house are talking theirs.