UK housing market falling faster than last recession, says Bellway - Telegraph

[Olly]

Hi, it's my first time on this forum so I'm a little unsure of how it all works. Apologies if I've come through the wrong channel.

I'm moving from Auckland, New Zealand to work for my employer in London for the next 5 years commencing April 2009. Probably living somewhere in Oxfordshire and travelling to work in Slough, West London.

My wife and I own 2 houses in Auckland with a loan to value ratio of 66%. One is negatively geared whilst the other is cashflow positive. Total value of properties is 1.2million NZD (ie.425,000 pounds). Total borrowings are 810,000 NZD (ie. 287,000 pounds).

We have an overdraft loan available from our NZ bank of 60,000 NZD (ie. 21,000 pounds).

It seems cheaper and smarter to take on a mortgage given our 5 year stay in the UK rather than simply renting. The monthly payments are similar but will it be a difficult exercise trying to obtain a mortgage if we can only put down a 5-10% deposit?

Could we even find anything around 200,000 pounds in one of the villages in Oxfordshire?

My UK salary will be 40,000 pounds per annum and my wife is an ESOL teacher and would probably work part time (ie. 10,000-12,000 pounds per annum).

What would you suggest?

Rishek, Hi

First, wish you and your wife every success for your future employment & lifestyle.

Second, suggest you check: Rightmove - UK's number one property website for properties for sale and to rent to see what might meet your price options and, second, visit: unbiased.co.uk and using the postcode for your new employers offices or, one from the homes on RightMove, find an Independent Financial Adviser. You can select one who will work on commission or by fees.

These guys will be able to provide you unbiased, 'sound' advice taking your present situation into full account also.

Again, wish you every success...

Olly

 

[artursw]

Wait, keep you deposit in your pocket (cash in king now) once people panic and start selling cheaply. People go mead because of media, don't, read, listen just calculate, observe real statistics, factors.

 

[UKand Singapore]

I think we have all experienced that it is impossible to catch the bottom of any down turn, property or otherwise.....unless by pure luck.

I understand your point, but the key is actually being able to buy at a price point that make sense economically, allows for maybe some further down turn, but with cash-flow, yield and capital gain calculation, actually makes financial sense in the term of investment you are looking at.

One man's meat is another man's poison (although of course we all want the best cut at the best possible price!).

 

[Prop-erty]

Now in the New Year, what are everyone's predictions on this?

 

[zanis]

UK Recession May Be the Steepest in over 20 Years

Another article here on the UK recession - click here

 

[web2dude]

We are far from the bottom.

Watch mortgage approvals! that is the key. If people cant borrow they cant buy! At the moment the Banks havent the funds to lend to individuals.

How many poeple if they have had a mortgage approved have had the mortgage valuation come back 10/20% lower than the agreed price?

Personaly i would right off 2008 and look to buy in summer 2009.

I think we're being overly optimistic if we think the market has bottomed out. Think beginning of 2010, rather than 2009 if I were you. There are lots of people wanting to offload houses and the market is still declining. It's all speculation, but I reckon, 10% less, followed by a year of no growth is realistic! Doom and gloom

 

[Hot Key]

The amount of deposit for first-time buyers is now about 18% - the largest in 35 years. Wow.

 

[zanis]

Repossessions in the UK jump 92%

UK like the USA will be in a world of pain this year (2009) - if you read the media reports this recession is a big one. Some even forecast that we will not recover until 2015! Though I have to think the media helps to make a bad situation even worse!

Here is another good article here on the UK recession - click here..

 

[ComRoute]

It's not all doom and gloom now though, since the interest rates have fallen.

 

[web2dude]

It's not all doom and gloom now though, since the interest rates have fallen.

Yes, let's look on the bright side. In about 9 months will be when the market starts to bottom out....

 

[Damian George]

Hi All

More bad news

Britain saw some of the steepest house price falls in the world last year, collapsing by 14.7 per cent, with only Latvia performing worse, research from Knight Frank shows, the Independent reports. More than three-quarters of the 42 countries surveyed recorded falls in the value of property in the final quarter of 2008, compared with just 27 per cent in 2007, the paper says.

 

[Damian George]

Oh - i forgot even more bad news

Economists at PricewaterhouseCoopers are warning UK companies to prepare for a 5pc fall in gross domestic product this year, a much bigger contraction than the Treasury's official forecast, the Telegraph reports. A report published today predicts that a deep recession will persist throughout 2009 and into early 2010 as a result of rising unemployment, falling house prices, lack of credit availability and slowing global growth. PwC says that although its central projection is for a 3.25pc fall in GDP in 2009, an even bigger contraction is possible because of the current level of economic uncertainty, the Telegraph notes.

UK - The Government is on the verge of increasing its stake in Lloyds Banking Group from 43 per cent to about 60 per cent, the Times reports. The deal would see Lloyds "insure" assets worth up to stg 250 billion in the Government's Asset Protection Scheme, the paper says.

 

[Prop-erty]

Oh - i forgot even more bad news

UK - The Government is on the verge of increasing its stake in Lloyds Banking Group from 43 per cent to about 60 per cent, the Times reports. The deal would see Lloyds "insure" assets worth up to stg 250 billion in the Government's Asset Protection Scheme, the paper says.

So does that mean that the UK government now rules most of the banks, rules most of the world via finances or is at risk of collapse?

What do you guys and girls think?

 

[Prop-erty]

In the 90's and nineties, property prices fell steeply in the UK too. Realistically, prices before the fall were way too high.

Just before this time, property owners were dressing up their properties very cosmetically, what with all those property shows on TV, then selling them for way over what the places were worth. So something like this is bound to happen. The higher you rise, the steeper the fall. The only thing that surprises me is that so many are surprised this has happened.

 

[Damian George]

agreed - My view is here is that we have another 20-30% to go - reason

a)banks are looking to repay savers and the govt so they can pay themselves bonuses
b)banks not willing to lend as they see the market failling further
c)job losses havent even started


i was supprised to see this level but now 6mths into this mess cant see a way out

 

[tomas123]

Is the british pound coming to an end

Are we going to loose all our pounds?

 

[Damian George]

The Pounds to Euro Exchange rate is now 1.0781

the pound doesnt look very healthy and may go lower

for more information please visit my currency blog

or post here

 

[Prop-erty]

I am losing out with a personal investment because of the £ vs the $. Dramatic change in just one year. Still making money but just about.

 

[briteways_dot_com]

There are bound to be some opportunities to make money in the present climate. we will just have to change the way we work.

 

[Damian George]

Hi Property,

if you need help sending pounds to us dollars let me know - i have helped a few people in this forum get the best exchange rates.

The Pound though has popped back above 1.4500 and as long as it stays there there is every chance that it will go back above 1.5000 (at least)