Time to map out a plan for Villa's future
- Says blogger Matthew Turvey
House price slump fears
Friday 7th December 2007, 11:45AM GMT.
House prices in the West Midlands could slump next year despite the cut in interest rates it was predicted today.
Prices in the region could be down by between 10 and 15 per cent on mid-2007 asking prices, according to the County Homesearch Company, the largest independent network of homefinders in the UK.
But high quality and “particularly desirable” homes will hold their value, with the property hotspots in Solihull and North Warwickshire remaining popular with those relocating for business, and South Shropshire continuing to find favour with people retiring.
Paul Castle, local director of County Homesearch in the West Midlands, said: “While I would expect to see an increase in supply in the new year, limited demand will undoubtedly drive a drop in prices.
“However, while the housing market in 2008 looks set for a slow start, a substantial cut in interest rates could turn this round.
“Demand for top-end detached family homes with large gardens, particularly those situated on the outskirts of a village, remains undeterred, a trend that I am confident will continue into 2008.”
Any recovery in the property market next year could hinge on further interest rate cuts on the back of yesterday’s quarter per cent reduction by the Bank of England’s Monetary Policy Committee.
But recent figures have confirmed the property market is not immune to rising interest rates.
Figures from the UK’s biggest mortgage lender Halifax this week showed that house prices fell for the third month in a row during November, dropping by 1.1 per cent.
It marked the first time that prices had fallen for three consecutive months since early 1995. The number of mortgages approved for people buying a home fell to a record low during October.
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About time to…its hard for young couples to get a foot on the ladder let alone a key to a new door.
To many companies building new houses out price the market and over price the house.
A house for 300 grand that costs 60 grand to build…whos pocket is lined thicker?
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IF PRICES COME DOWN,MORE PEOPLE WILL BE ABLE TO AFFORD/WANT THEM LEADING TO FURTHER DEMAND AND PUSHING PRICES UP.THEY WILL ALWAYS RISE IN THE LONG TERM SO E AND S STOP SENSATIONALISING AND CAUSING PANIC.
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Yes prices have trended up in the long term but when they’ve bubbled there’s always been a subsequent correction. So you’d have to be daft to buy now when average house prices are 8 times average salary and when the long term ratio is 3.5 times. Wait 2 or 3 years and pay 30% less.
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Prices in Cheshire are falling very fast, I have seen some prices shaved by 10% now..
The streets are full of for sale signs, some even have price reduced, I have not seen this since the 80′s..
We sold our house last year and are happy to sit this out for the heavy crash, as it has to happen prices are beyond affordability levels, even for movers like us.. And we have 100K deposit!!
We expect prices to drop by at least 30%
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Property prices drop by 1.1% .. oh no, how terrible, there’s going to be a slump, it’s the end of the world! Why this sensationalism in the media, yet when house prices rose 3-fold in a decade it was hailed as a good thing and we were all becoming ‘wealthy’. Weren’t we?
Wake up to reality! We’re not wealthy. We’re actually worse off than before the start of this boom. Over the last decade many have been plunged into obscene amounts of debt, financial hardship and slavery. An entire generation is effectively priced out of the market. Home owners with all their ‘equity’ are unable to trade up.
Yet the illusion of ‘equity’ deludes people into thinking they’re wealthy. In reality it is meaningless unless they trade down or go into renting. The debt however is very real and represents many years of future unbroken labour and stress!
The last decade has been a lottery for investors and speculators, some of whom have won big – especially those who got in early and were smart enough to get out early. Unfortunately the market appears to have turned and the game is up. The smart money is out and many are about to find out what it’s like to lose.
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I am always confused by VIs. The market cannot fall because of the shortage. Then it may fall in some parts only. Then it is of course desirable areas will remain healthy. The biggest contradiction in forecasts(for all regions) by VIs is that if all these supply shortages will maintain the market, why will it collapse without an interest rate cut?
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This is just estate agent spin. Why on earth would houses at the top end of the market hold their price, whilst the rest of the market falls by 10 to 15 percent ?.
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Property has been a one-way profiteering bet with prices tripling over the last decade. Far too many young people and growing families have been priced out of affordable homes, whilst speculators have made fortunes. The divide between the property owning haves, who’ve enjoyed spectacular tax free asset growth, and the have-nots has become obscene. A correction in property prices is long overdue and will be greeted with relief by many.
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Whilst I sympathise with those unfortunate enough to have bought a home at the top end of the market, and who may soon face negative equity, I would welcome a serious journalistic piece examining the positive benefits of a house price correction back to a more normal 3 to 4 times average earnings. Perhaps it could be titled “House Price Slump Joy”.
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