Housing Market Crash

[Goaters]

With the cost of houses seemingly falling now, with figures suggesting a %1.3 fall in prices in August are we about to have a housing crash akin to 2008.

Inflation soaring, interest rates rising sharply and staring in the face of a year long recession then something surely has to give.

The reason for the thread is in thinking about buying now, a fair wedge of money but it’s tough to know do you splurge now before rates rise or wait it out incase a crash comes and I’d then be losing tens of thousands on the value.

What are peoples thoughts as will the market come tumbling down or just slow down?

 

[City Hobgoblin]

If you sell your current property at a currently inflated value, then you don’t lose ?
if you sell and buy in a year or so when values have dropped will it really make a difference?

 

[Goaters]

If you sell your current property at a currently inflated value, then you don’t lose ?
if you sell and buy in a year or so when values have dropped will it really make a difference?

I’m looking to spend a couple of hundred thousand more to upgrade houses.

 

[BimboBob]

Sell now, wait 6 months, then buy another.

Probably the only way to make money and get the house you want.

You'll lose cash renting but probably not as much as you would if you sold in 6 months. Probably.

In all honesty, if you see a house you like now then go for it. As long as you factor in the interest rates and have secure money coming in.

 

[Corky]

There was an unexpected rise after the first lockdown, one house near me sold in 2019 and 2022 with no visible improvement at 32% more.

A slow to steady decline back to 2019 levels is possible, but not really a crash. What you will see drop more than anything is the number of sales.

I always had it down for this summer, maybe 2 months longer than expected. Buy now at lower interest rates or in the future at higher interest rates and a cheaper property. Which will end up cheaper in the long run? No idea.

New builds will struggle, the ones needing significant new road infrastructure are being put on ice as the price of tarmac has gone through the roof.

 

[stonerblue]

All relative.

 

[Tuearts right boot]

With the cost of houses seemingly falling now, with figures suggesting a %1.3 fall in prices in August are we about to have a housing crash akin to 2008.

Inflation soaring, interest rates rising sharply and staring in the face of a year long recession then something surely has to give.

The reason for the thread is in thinking about buying now, a fair wedge of money but it’s tough to know do you splurge now before rates rise or wait it out incase a crash comes and I’d then be losing tens of thousands on the value.

What are peoples thoughts as will the market come tumbling down or just slow down?

During the last ' housing crash...' I heard of someone trying to be clever and beat the system by selling at what he thought was The Top of the market and rented for a year...problem was it wasn't and he ended up actually having to downsize as by the time he realised what was going on he would have had to pay considerably more just to get his old house back. In the long term you wont loose.

 

[KS55]

The thing with house price fluctuations is that they are not really driven by logic. Confidence is all important. I had some dealings years ago with a prof from Oxford who was trying to model house prices but was struggling. I advised him to increase enormously the weight he gave to confidence. Voila, much better results.
The lesson is, if you are planning long term ownership, current price movements will be insignificant over time. Thus, do what your plan entails without worrying too much about price fluctuations. The only rider is if you believe there will be a big crash, cation might be advised. Highly unlikely in my estimation, perhaps some falls but not drastic because lending policy has been much tighter in recent years.

 

[Wafty Cranker]

With the cost of houses seemingly falling now, with figures suggesting a %1.3 fall in prices in August are we about to have a housing crash akin to 2008.

Inflation soaring, interest rates rising sharply and staring in the face of a year long recession then something surely has to give.

The reason for the thread is in thinking about buying now, a fair wedge of money but it’s tough to know do you splurge now before rates rise or wait it out incase a crash comes and I’d then be losing tens of thousands on the value.

What are peoples thoughts as will the market come tumbling down or just slow down?

Next to no chance we have a house price crash akin to 2008 imo.

Inflation back then was under control, now we’re in double digits. If inflation is running at 10%. Even if house prices stay the same they’ll be falling by 9% to 10 % (depending which way round you look at it) in real terms. So for property prices to fall by 15% which I believe is similar to the uk in 2008/9 you’d be looking st about a 25% crash in real terms. No way that happens as far as I’m concerned.

They might drop a bit but the cost of capital would likely go up, so you might get a better price but paying more to service the debt.

For your situation it depends on the opportunity cost of what you’d do with the cash. If you’ve got a couple of £100k sat in cash then inflation is eroding that away for you anyway.

 

[Mazzarelli's Swiss Cheese]

During the last ' housing crash...' I heard of someone trying to be clever and beat the system by selling at what he thought was The Top of the market and rented for a year...problem was it wasn't and he ended up actually having to downsize as by the time he realised what was going on he would have had to pay considerably more just to get his old house back. In the long term you wont loose.

Your last sentence is the key - long term. House price growth in luding bounce back from a crash is pretty much guaranteed so long as you can sit it out. Best time to buy is always 20 years ago, best time to sell is only when you have to