quote:

---

Originally posted by Russ
Worst I have half a million pound house ambitions thread ever

[Edited on 09-02-2015 by Russ]

---

quote:

---

Originally posted by Russ
Worst I have half a million pound house ambitions thread ever

[Edited on 09-02-2015 by Russ]

---

quote:

---

Originally posted by Paul_J
quantitative easing / low interest rates / foreign investors / cost of renting / hype.

quantitative easing is inflating all asset prices. More money being pumped into the system, means it trickles down through assets - property / stock shares / expensive cars etc.

Low interest rates - Money is available really cheap currently and a lot of people will be stretching what they can afford by looking at repayments at current market rates - which may bite them when interest rates go up. Either way, it means they're more likely to just go mad and increase the amount borrowed to secure a house they want - rather than spend strictly what they can afford.

Foreign investors buying properties off plan for hope of profit / security with money. The super expensive properties have been bought by the super rich foreigners causing a ripple people moving outwards and chain of people selling up -> buying somewhere cheaper and releasing money. (Since they have lots of money available in this transaction - they can afford to out bid crazily high).

Also foreign investors who just buy average new build flats in hope of renting out / just having it as an investment - means theirs a lack of new housing compared to the demand - this means more people per decent house available. There's a whole world of renters wanting to buy.

Rent prices keep going up and I find a lot of people lock themselves into a trap where they earn more, they spend more on rent and thus get struck in this cycle. These people are seriously keen to escape the trap and just buy as they could pay similar or less a month for a mortgage and own the place. There's a whole range of these people who are trying to bite at the decent / affordable properties at the bottom of the ladder which in turn pushes prices up / reduces availability. Also linked to this are the rich constantly buying the properties to rent out - making less properties available to buy.

Hype. When people read 'house prices went up 23% in a year' - they panic... think they will never get a property unless they buy now! Some feel they missed out on profits they could've made and ultimately everyone is thinking that everything will keep going up.

I expect four things to reverse this trend.
- Raise of interest rates, suddenly there won't be so much cheap money and demand will fall - causing prices to fall
- Stop of QE / Financial meltdown - another 2008 / housing bubble - this would make property prices fall but not for a good result
- Build more properties ... more supply would solve the problem except the foreign investors are buying most new builds.
- Foreign investors pull out of the market ... I believe this will happen like a domino effect. Take one of the above - prices fall, savy foreign investors realise it's over and sell up. Prices fall again. Then panic ensues and the price keeps falling.


[Edited on 11-02-2015 by Paul_J]

---

quote:

---

Originally posted by Steve
u wot?

---

quote:

---

Originally posted by Paul_J
Sorry should've just pm'd James - I could've guessed you Neanderthal apes would not appreciate a constructive post to a topic.

Feel free to go back to grunting at each other / smelling each other's bums.

---