House price fall 'at 1990s rates'

  Phere 10:35 16 Jan 2008

click here

worrying times...

  ventanas 11:39 16 Jan 2008

Not really, if it means that the stagnant market get going again all to the good. Prices have to be at a level that can be afforded. Cut out the first time buyer and that means standstill. If the value of my, owned outright, house goes down, then if I sell, the house I purchase will also be cheaper than it would have been. Swings and roundabouts.

This has been coming for a long time, fuelled by mortgagees lend ridiculous amounts, and sometimes being misled by certain desperate brokers. If lending had been kept at a sensible level then prices would have had to go with that. People can only sell for what others can pay.

I see this as simply a step back to common sense.

There may be some negative equity, but it is not the first time.

  Quickbeam 12:41 16 Jan 2008

Happens after every period of prosperity... No government in history has ever solved this fact.

  Stuartli 12:58 16 Jan 2008

A great deal of the problem of overpriced houses, it seems to me, is down to years of excessive valuation on a national scale by estate agents; naturally they have a personal interest in just how much properties raise when sold.

  ventanas 13:51 16 Jan 2008

Overvaluing seems to be the precise problem with the recent boom in flats. Instead of being sold at sensible prices to first time buyers they were sold in blocks at inflated prices to speculators (who should have done more homework) for buy to let. They have now got their fingers burned, Can't get the rents they need and can only sell at a loss. What a shame.

  georgemac © 17:27 16 Jan 2008

Overvaluation and the banks lending ridiculous amounts have fuelled this boom - driven by self interest.

There have been other factors like people stopping investing in pensions and putting the pension money in property, buy to let etc.

First time buyers have indeed been largely priced out of the market so it is unsustainable.

My first mortgage repayment interest rate was 15.25%, imaging if rates went up again even to 8% most people would be defaulting on payments.

  oresome 18:46 16 Jan 2008

Bear in mind that living patterns have changed over recent years.

There are now more people living alone and more that require mobility to maintain employment. Many do not want the hassle of maintaining a property or the hassle involved in selling when wanting to move.

For these types, purchasing property is not necessarily the best option and an active and competitive rental market is of more value to them.

So someone has to purchase properties, take the financial risk and act as landlord for those that don't want to purchase themselves. Hoping that landlords have to pull out and sell at a loss won't help the renters, although those wishing to buy might benefit.

  jz 00:26 18 Jan 2008

"down to years of excessive valuation on a national scale by estate agents" I can't really see that.

I put it down to years of low interest rates and lenders willing to lend too many times a person's salary.

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