House prices 'could fall by further 55 per cent' House prices 'could fall by further 55 per cent'
Page 1 of 3 123 LastLast
Posts 1 to 10 of 27
  1. #1

    I Am Legend

    BrilloPad has reached the peak. Play again?


    Join Date
    Aug 2006
    Posts
    104,637

    Default House prices 'could fall by further 55 per cent'

    http://www.telegraph.co.uk/finance/e...-per-cent.html

    House prices 'could fall by further 55 per cent'
    House prices may fall by a further 55 percent and there is a "very real probability" that Britain will be bankrupted, a leading investment bank has warned in a private note to clients.

    People who bought buy-to-let flats are expected to “begin panic selling” and the average home value could drop below £100,000.

    The predictions in a 298-page report from Numis Securities, a City investment bank, are the bleakest yet on the deteriorating state of the British property market.

    House prices have already fallen by about 20 per cent over the past year.

    However, in the note written last month, Numis said: “Despite UK house prices already having fallen 21% from the peak, we do not believe that the correction is anywhere near over.

    “Our core headline forecast is that UK property prices remain between 17% and 39% overvalued based on fair valuation. Moreover, history has shown us that when property…which has experienced a price bubble corrects, the price tends to fall below fair value for a period of time, as confidence in that market remains low. Prices could fall a further 40-55% if the over-correction was as bad as the early 1990s in our view.”

    The report warns that “city centre flats” and “new executive homes” are likely to record the biggest reductions and describes investing in buy-to-let property as a “poor man’s hedge fund”.

    “It is the action of these amateur investors over the next few months which we are most concerned about,” the report says. “We expect some to begin panic selling their portfolios, with the peak volume as is almost always the case with private investors, being at the market trough.”

    Yesterday, Alistair Darling, the Chancellor, warned that the world is facing the most difficult economic conditions for “generations”.

    However, the Numis report is scathing of Government attempts to help the economy.

    “The Prime Minister and Chancellor have publicly stated that they want banks this year to lend at 2007 levels,” it said. “We think this is a crazy policy, given that too much debt was one of the prime reasons why the economy has its current problems.”

    It also criticises the huge debts being run up by the Government to pump money into the economy. Yesterday, John Lewis, the retailer, said that the £12.5 billion cut in Vat has not made “any long term difference at all”.

    The Numis report says: “The bankruptcy of the UK is a very real probability as the UK Government is trying to stimulate a greater debt burden in a grossly indebted economy. We believe the scale of the macro imbalances in the UK means there is no prospect of a recovery in 2009 and we expect the UK to be mired in a deep recession through all of 2010.”

    Last night, the Conservatives said that the Numis analysis increased the pressure on the Prime Minister to apologise. Grant Shapps, the shadow Housing minister, said: “This is a devastating critique of the Government’s record and how Gordon Brown’s credit bubble will lead to a mountain of debt, a wave of repossessions and negative equity misery. Labour Ministers must take direct responsibility for fuelling buy-to-let speculation.

    “Gordon Brown’s fingerprints are all over this economic wreckage and he should now have the decency to at least apologies for his mistakes.”

    Yesterday, it emerged that the number of borrowers falling behind with their mortgage repayments has already doubled in the past year. According to Moody’s Investors Services, borrowers more than 90 days in arrears have increased to 1.5 percent of all home loans compared to 0.6 percent a year ago.
    Last edited by BrilloPad; 12th March 2009 at 11:47.
    Fight HMRC now! Help sue HMRC individual officers/government ministers for malfeasance in office. Visit https://www.loanchargejustice.com/ and scroll to the bottom of the page to donate.

  2. #2

    More fingers than teeth

    BlasterBates - scorchio!

    BlasterBates's Avatar
    Join Date
    Jul 2005
    Location
    1922 Commitee
    Posts
    14,098

    Default

    Oh dear.... I can hear Corporal Jones...

    DON'T PANIC
    I'm alright Jack

  3. #3

    BardLike

    AlfredJPruffock is a permanent contractor

    AlfredJPruffock's Avatar
    Join Date
    Jul 2005
    Location
    East Kilbride Library
    Posts
    5,494

    Default

    I predicted last year that there was no reason ti stop property prices dropping by 80 per cent as per the Tokyo fall in the property market - and that was from the early 90's and they still have not recovered - in fact now there is a new recession in Japan.

    Since last year theres been a 30 per cent fall - so another 50 per cent or more fall over the next year is certainly on the cards.

    You cannot buck the markets.

    Fortunately the Pruffock Mansions in Scotland have held their value - you see - its the exception that proves the rule.

    PS The Tory housing minister is talking non-sense - property owenership for everyman was at the heart of the Thatcher vision for the UK
    Last edited by AlfredJPruffock; 12th March 2009 at 09:47.

  4. #4

    More fingers than teeth

    TimberWolf is too good to be a permie

    TimberWolf's Avatar
    Join Date
    Oct 2007
    Posts
    17,505

    Default

    I wish these blinking experts would keep their traps shut for a few weeks, they might put my buyer off.

  5. #5

    Better than AtW

    sasguru - scorchio!


    Join Date
    Jul 2005
    Posts
    36,111

    Default

    Never mind, Cybercretin's house has risen by 50% in the past week alone.
    Boomed!
    Hard Brexit now!
    #prayfornodeal

  6. #6

    Super poster

    Ruprect is too good to be a permie

    Ruprect's Avatar
    Join Date
    Jun 2006
    Location
    London
    Posts
    4,174

    Default

    The price of my house is still rising

    - Cybertory
    "Experience hath shewn, that even under the best forms of government those entrusted with power have, in time, and by slow operations, perverted it into tyranny. "


    Thomas Jefferson

  7. #7

    Richer than sasguru

    DimPrawn is a fount of knowledge

    DimPrawn's Avatar
    Join Date
    Jul 2005
    Location
    Brexit Britain
    Posts
    34,752

    Default

    I saw Kirsty and Phil on TV last night, urging some thick gullible buyers to "jump in quick, this property won't be on the market for long!"

    Had to laugh!


  8. #8

    BardLike

    AlfredJPruffock is a permanent contractor

    AlfredJPruffock's Avatar
    Join Date
    Jul 2005
    Location
    East Kilbride Library
    Posts
    5,494

    Default

    Quote Originally Posted by TimberWolf View Post
    I wish these blinking experts would keep their traps shut for a few weeks, they might put my buyer off.
    Whoops sorry TW - how about this then ...

    The recent decline in UK property proces has clearly now reached its bottom - the stats from Jan demonstrate that propertry prices can now expect steady growth over the year and beyond - this amounts to an excellent opportunity for those seeking to invest in property whilst prices remain affordable - those whom hesitate now will later regret .

    Perfect.
    Last edited by AlfredJPruffock; 12th March 2009 at 09:53.

  9. #9

    Godlike

    expat has more data than eek


    Join Date
    Jul 2005
    Location
    Brutopia
    Posts
    8,320

    Default

    Quote Originally Posted by DimPrawn View Post
    I saw Kirsty and Phil on TV last night, urging some thick gullible buyers to "jump in quick, this property won't be on the market for long!"

    Had to laugh!

    Was there an "(R)" beside the TV listing?


  10. #10

    Super poster

    rootsnall has no reputation


    Join Date
    Jul 2005
    Posts
    2,966

    Default

    The BTL panic selling they are talking about is being prevented by the interest rate cuts at the moment. If/when interest rates start to climb I think that's when you'll see real carnage.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •