The Wholesale Forums

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How much do you think prices will fall by Dean?

[greedyboy]

That is the million dollar question! But I reckon with the lack of mortgages and therefore first time buyers I think we will see a drop. I spoke to my finance guy and he reckons as much as 20% short-term 6 - 18 months.

Mt flat I was painting today I bought 10 years ago for 60K. I paid it off about 5 years ago and now I am looking at about £200K. I was originally going to sell it and the proprty I live in and buy GreedyBoy Towers. Now I hope to buy a similar property in 12 - 18 months for £150K and have 50K left in the bank.

Capitalism at it's finest I reckon it's worth a punt!?!?

Those who are strapped up to the eyeballs will be hurt most. I remeber when this happened last, a friend of mine had 5 properties and eventually lost them one by one.

[Tristancross50]

My financial advisor thinks they will still be bad in 5 years but who knows ,also someone else I know said something like it goes in a 7 year cycle guesss we will have to wait and see.

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I thought about waiting but theres a strange situation going on in the local market, properties are still selling well at good prices. Yet you can pick up some repo's or other distressed sales for aboue 60% of what the mortgage company values them at, which I still think is a good deal.

In my area I think the bottom will be -10 to -15% at the bottom. One thing for sure is that you are not going to suffer all the much if you step off the market, which we haven't seen in years.

[greedyboy]

Over the past 5 years money hase been so cheap to buy. You could get a 200K loan with a packet of crisps! Now it's payback time. Interest free periods or stupid 3.5% rates anre coming back to bite some backsides.

Since Christmas I have notice a massive downturn in general business. Last sunday I had lunch with a director of a large restaurant chain, he said the same. So much so they have just reacted and changed the menus to incorporate much cheaper items.

My neighbour but one ownes a chain of electrical stores and he says the same. He has a warehouse of stuff he can't move.

One of my businesses target markets is home owners/generally the 'mature buyer' (not the ipod gerneration!) and that has been hit the hardest. Sales are down 50% on this time last year.

I could go on all day with examples. One thing is all the above is just the tip of the iceburg. As I said before, those who are strapped up to the eyeballs are going to feel the pinch the worst.

[Tristancross50]

I agree I think things will get worse and with gordon brown getting rid of the 10 p tax bracket (which is ridiculous) it is going to affect the poor the worst who need money the most.

[MustHaveMobiles]

I cleared my property portfolio about 6-9 months ago after my business partner decided to emigrate, recently though I have been looking into reinvesting some of this back into property and have bought a number of repo properties and "tough sell" properties and have put them ALL to let. In total I have 9 active ones at the moment and their combined worth and potential means that the bank is ALWAYS willing to finance the next one.

Confidence is high that the will be a housing market drop but with shrewd buying this can be offset, a 20% drop will obviously affect my portfolios value but will not bring about negative equity issues. Larger drops are also being banded around, hence the PMs intervention with the banks to look at what they can do to prevent a crash similar to those previous.

Lots of advise says DO NOT touch the housing market but personally I feel if conducted right it is still a very profitable area. I am also about to invest in some US properties with a friend as there is great value over there at the moment...

[Tristancross50]

I heard some places in america feel by up to 40% I just had a chat with my financial advisor and he is saying it will be harder to borrow money from banks what do you think ??

[lighthousedirec]

I heard some places in america feel by up to 40% I just had a chat with my financial advisor and he is saying it will be harder to borrow money from banks what do you think ??

Simple answer is yes, but for people who have a decent deposit or a sensible amount of equity the money will still be available.

Anyone selling to companies on trade accounts should check their own credit checking and account systems as well, it could be hard to make up a bad debt in the next year or two.

[lovinit]

Interesting discussion. I was looking at picking up a second rental property and thought best wait 12-18 months, let the prices drop, pick one up and rent it to the poor sods who can't get a mortage!

Greedyboy - I'm intrigued by your notion of selling now and buying back in a few months. Something I will certainly go away and think seriously about now. Would be nice to have a break from the landlord thing for a while particularly with another baby on the way!