Gringo Posted July 18, 2008 Author Share Posted July 18, 2008 the "new paradigm" - it's different this time. When the credit markets loosen up, there still won't be 100% mortgages, there still won't be a market for banks to collaterize and package the mortgage debt. Those days are gone. I see no rise in house prices "in real terms" for a good few years. This is no different to 1990 in terms of effect, but very different in terms of cause. Then you had unemployment and widescale industry seizures, now you have widescale financial contractions. Link to comment Share on other sites More sharing options...
Gringo Posted July 22, 2008 Author Share Posted July 22, 2008 Looks like burnt fingers all around 'Take cash and leave' says lender A former sub-prime mortgage lender is offering an 8% discount to its borrowers if they redeem their loans. Edeus, which started up in 2006, is making the cash-back offer to 400 customers and may extend it to thousands more if it proves popular. The lender wants to get the loans off its books but can no longer find professional investors willing to buy. A spokesman admitted the idea sounded "bizarre" but it was cheaper than selling the loans in any other fashion. 'Lesser evil' Alan Clearly, the managing director of Edeus, admitted this would mean making a loss on each mortgage. "It's the lesser of two evils," he said. "Over the last 10 months the only way we have been able to raise fresh loans is by offering steep discounts to multi-national banks. "So instead of offering that to the bank we are dealing with customers directly," he added. Edeus is also willing to waive its early redemption and exit fees, but people will have to pay any set-up fees that might be demanded by a new mortgage lender. Edeus were bought by Merrill Lynch in 2007 in order to take advantage of the booming buytolet and subprime uk mortgage market, they spent a fortune in new systems for application processing, loads on coproorate advertising jollies for brokers in order to drum up business, and are now gone bump. So anyone with and Edeus mortgage, phone up and offer them 80% and try and negotiate them down. Link to comment Share on other sites More sharing options...
b6bloke Posted July 22, 2008 Share Posted July 22, 2008 I met with my finacial advisor who said that by january they expect prices to have dropped by 25% Link to comment Share on other sites More sharing options...
Nigel Posted July 22, 2008 VT Supporter Share Posted July 22, 2008 I met with my finacial advisor who said that by january they expect prices to have dropped by 25% Id be very surprised if they fall by that much in 6 months. I would fully expect thet kind of drop but not for a couple of years barring any major external problems. Link to comment Share on other sites More sharing options...
shambles Posted July 22, 2008 Share Posted July 22, 2008 I think if we saw that type of drop across the board in 6 months there would be melt down. I could see it over 18 months - 2 years though. Link to comment Share on other sites More sharing options...
cheltenham_villa Posted July 22, 2008 Share Posted July 22, 2008 i put in an offer of 200k on a new build house in cheltenham 12 months ago, this was rejected and i couldnt afford to go higher. I had a call from an estate agent today saying they are now accepting offers of around 160k for the same properties. Shocking. Link to comment Share on other sites More sharing options...
ianrobo1 Posted July 22, 2008 Share Posted July 22, 2008 isn;t that good for you ? Link to comment Share on other sites More sharing options...
cheltenham_villa Posted July 22, 2008 Share Posted July 22, 2008 yeah especially as ive kept money in the bank and not found anywhere. just concerned about further drops and if i go for it wanting to get it at the cheapest price. Link to comment Share on other sites More sharing options...
ianrobo1 Posted July 22, 2008 Share Posted July 22, 2008 well thats a choice isn't it ? I would say maybe wait util the end of the year, but no one really knows what could happen Link to comment Share on other sites More sharing options...
PaulMcgrathsknees Posted July 22, 2008 Share Posted July 22, 2008 i put in an offer of 200k on a new build house in cheltenham 12 months ago, this was rejected and i couldnt afford to go higher. I had a call from an estate agent today saying they are now accepting offers of around 160k for the same properties. Shocking. Why not just chance your arm for a £145,000 bid. May settle at £150,000. Sounds like a more than 25% reduction to me? Just make sure the empty houses aren't being filled up as "social" housing? May only be worth £100,000! Link to comment Share on other sites More sharing options...
Gringo Posted July 23, 2008 Author Share Posted July 23, 2008 i put in an offer of 200k on a new build house in cheltenham 12 months ago, this was rejected and i couldnt afford to go higher. I had a call from an estate agent today saying they are now accepting offers of around 160k for the same properties. Shocking. Former new-build flats have seen their prices slashed 45-50 per cent at auction, but many are still failing to sell. To the inexperienced eye, Phoenix Pavilions might have seemed a great investment. The three small blocks of new-build apartments, sold for between £210,500 and £345,000 during 2006, overlook the lovely blue flag beach of Dovercourt Bay near Harwich in Essex. But while local estate agents say tenant demand is strong for the flats, landlords have struggled to achieve rents which cover their mortgage payments. New build flats - prices being hammered Going, going, not gone: new-builds are slow to sell at auctions, despite price reductions One has had his property up for sale for several months at £250,000, which would make him a £9,500 profit, but his estate agent, Bairstow Eves in Harwich, admits he hasn't a hope of achieving that price - more than double the level that other Phoenix Pavilions flats are asking at auction. Three of the development's flats, all repossessions, have been doing the auction-room rounds for months, their price gradually dropping, but not by enough to find buyers. Flat 17, originally bought for £225,950 in September 2006, and repossessed a year later, has failed to sell at auction six times. Last week it had a reserve price of £120,000, but the highest bid was £102,000 - 55 per cent down on the original sale price. UBS warns housebuilders "The speed of the collapse in April and May has been astonishing," said Mark Stockdale, UBS's lead housing analyst. "This is as bad as 1991 – without a doubt. And the big difference is that I have never seen a housing market fall as fast as in the last eight weeks." So check the auctions out and see what "bargains" are to be had. Link to comment Share on other sites More sharing options...
mockingbird_franklin Posted July 23, 2008 Share Posted July 23, 2008 reading the later part of this thread it looks like I've been relatively lucky (fingers crossed for no last minute hickups) sale of my old house completes on Friday, got just under asking price and only 8% below the valuation at September 2007, I'll clear an amount I would have been happy with when I put it on the market, especially as it took 8 months to get an offer, lots of buyers but no one in a position to buy. I'm already resigned that l've got no hope of selling my current home at moment for anywhere near the price I paid in sept 2005 I guess it looks like I'll be renting if I get to Australia, (fingers crossed for the visa) at least I'll be Mortgage free so renting current house out should cover the majortiy of any Australian rent, might also give a chance for favorable movement in the exchange rate (Australian dollar currently at a 21 year high against the pound means I'll get shafted two ways if I sell to buy) I'll have a look at selling but I'm not hopeful of A) finding a buyer or getting a good price. At least I have some room for maneuver from Friday (fingers crossed) as I'll be mortgage free and still have a reasonable amount of free capital, I don't have to pay tax in Australia on UK income and my Uk tax allowance should cover most of the rental income after deductions for agents maintainence etc. feel very sorry for people who have to sell and have huge mortgages. From what I've heard, the wealthier landlords are putting in offers at anything up to 40% below asking price, win win situation fort hem, they get insulation from the predicted level of price drop, the seller is taking the hit and they have the income from the rental Link to comment Share on other sites More sharing options...
Genie Posted July 23, 2008 Share Posted July 23, 2008 Anyone know where I can check auctions online? Link to comment Share on other sites More sharing options...
Gringo Posted July 23, 2008 Author Share Posted July 23, 2008 Not that I can remember - most of them you have to phone up for a catalogue. Link to comment Share on other sites More sharing options...
Genie Posted July 23, 2008 Share Posted July 23, 2008 Ok cheers, was thinking of picking up a cheap flat or something as an investment property in the Tamworth area looks we're gonna be edging towards the time to do it. Link to comment Share on other sites More sharing options...
ender4 Posted July 23, 2008 Share Posted July 23, 2008 and yet in the area in Solihull that i am looking for a house, the prices are still just as high as ever. i was hoping that the prices would start going down, but there is only 1 house for sale on the estate i like, and they have stubbornly kept the price the same since they put it on the market 2 months ago. i think its overpriced by about £80k. Link to comment Share on other sites More sharing options...
Gringo Posted July 23, 2008 Author Share Posted July 23, 2008 Ok cheers, was thinking of picking up a cheap flat or something as an investment property in the Tamworth area looks we're gonna be edging towards the time to do it.I'd give it another 6 months and look again. Stear clear of flats, especially new builds - go for the old solid terrace houses, preferably where there is room for expansion, ie adding an extra bedroom in the loft etc. Link to comment Share on other sites More sharing options...
Gringo Posted July 28, 2008 Author Share Posted July 28, 2008 Rejoice, rejoice the crash is over Property market: House prices forecast to rise by 25% over next five years Property prices are forecast to rise by 25% in the next five years, according to a report that predicts the market will bounce back from its current slump by 2011. Next year will see a modest 2.1% fall and by 2010 the market will gradually start to recover. The year after, prices will start to soar and by 2013 the average cost of a home in England will have risen by a quarter to £274,700, according to research carried out for the National Housing Federation. ______________________ The federation's chief executive, David Orr, said: "As soon as the economic outlook improves, house prices will resume their previous upward trajectory." The NHF study, carried out by independent researchers Oxford Economics, predicts a rise in house prices of 1.3% in 2010, then further rises of 5.2%, 9.2% and 9.3% in the succeeding years, resulting in an overall growth of 25% from the 2007 average of £222,600. Last year, 167,577 new homes were completed but this was expected to fall this year to 120,000, the report said. Meanwhile, housing waiting lists have doubled in a quarter of areas. The NHF, which represents housing associations in England, said it was critical that the government continued to invest in new social housing. Link to comment Share on other sites More sharing options...
mykeyb Posted July 28, 2008 Share Posted July 28, 2008 You see I made the mistake of buying a house to live in rather than an investment - silly me. Its still worth more than I paid for it 4 years ago but since Im not planning on moving anytime soon it doesnt really matter - the people who buy to let might have their finger s burnt though Link to comment Share on other sites More sharing options...
drat01 Posted July 28, 2008 Share Posted July 28, 2008 You see I made the mistake of buying a house to live in rather than an investment - silly me. Its still worth more than I paid for it 4 years ago but since Im not planning on moving anytime soon it doesnt really matter - the people who buy to let might have their finger s burnt though Well said that man Link to comment Share on other sites More sharing options...
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