House price fall prediction of 10 per cent?

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tooposhtopush
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House price fall prediction of 10 per cent?

Postby tooposhtopush » Wed Oct 05, 2022 12:25 pm

Reading this with interest, would be interested to know if others think it will apply in our corner of London too?

https://www.standard.co.uk/homesandprop ... 30190.html
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Cinderalla
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Re: House price fall prediction of 10 per cent?

Postby Cinderalla » Wed Oct 05, 2022 1:57 pm

I would hope that we would be relatively protected here. Good schools, family friendly etc. I guess if you are selling and buying at the same time in a similar place does it really matter that much? Not that I have any property experience other than having bought a house.
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Lola123
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Re: House price fall prediction of 10 per cent?

Postby Lola123 » Mon Oct 10, 2022 8:05 am

It’s already affecting this area with properties over the last couple of weeks not selling compared to historical figures. I think this area will certainly be affected with the economic climate large financial institutions are looking at staff cuts many of whom will employ people who live round here. Private schools have already seen a drop in number of applications, one has gone from 5 to 3 reception classes this year. It’s a pretty gloomy outlook for the next 18 months or so 😳
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Berna
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Re: House price fall prediction of 10 per cent?

Postby Berna » Mon Oct 10, 2022 8:41 am

If we don't do something to stop any further high density developments without infrastructure or transport support then our area will never recover . Prices might decline but I'd still be looking elsewhere.
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szerma
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Re: House price fall prediction of 10 per cent?

Postby szerma » Tue Oct 11, 2022 3:31 pm

I think that the widely discussed number of reception classes and nurseries closing is also partly due to demographics - 2012 was a "baby boom" year in London and the births have been declining every year. Good news for parents of kids starting school now as the competition for places at primary and secondary schools should lessen:

https://www.trustforlondon.org.uk/data/ ... hs-deaths/

 
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SouthLondonDaddy
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Re: House price fall prediction of 10 per cent?

Postby SouthLondonDaddy » Wed Nov 02, 2022 10:38 pm

Higher mortgages will obviously cause the demand to go down.

As recently as 12 months ago it was possible to have a 75% LTV,m fixed for 2 years, at 1%. Now I don't think you can find a 2-year fix for less than 5%. To put things into context, banks had to "stress test" borrowers by 3% more, ie if they gave you a mortgage at 1% they had to verify you could still pay even with rates of 4%. Well, they are now much higher!

A simple example: a 25-year £600,000 mortgage at 1% means payments of £2,261 per months.
After 2 years you will have paid ca. £43k of principal.
If after those 2 years you remortgage at 5%, that's £3,400 per month - a 50% increase!!!

Even if your salary has gone up in those 2 years, it won't have gone up enough to compensate.
Oh, and don't forget that a salary increase of, say, 6% of your gross salary, means your net increases by less than 6%.

I personally don't think it will be a catastrophe, but the impact will be felt. Those who stretched themselves to the max entering into bidding wars between 2020 - 2022 will be in very bad shape. The others, well, obviously it depends.
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