Josh

dc Wrote: ------------------------------------------------------- > But prices rose in Dulwich during the last > recession and flatlined in ED. Admittedly this > downturn is a different beast with global > implications but then the response to it has been > rather more robust than last time too. Who knows? average London prices fell 29% in the last bust, with poorest parts of London hardest hit. East Dulwich was hit quite hard, Dulwich village less so. But there's an important difference between the last crash and this one. Last time round we had high inflation and high interest rates. The high inflation masked the fall in real values. If house prices stay flat and inflation runs at 10%, then house prices are falling about 10% in real terms. This time round we don't have high inflation, so the full extent of falls in real values will also occur in nominal values. Parts of London that flatlined in the last crash (but fell in real terms) will fall both in real and in nominal terms this time. And of course sterling is falling too, so it's a double whammy. House prices in London have already halved from the point of view of Europeans.

House prices do seem to have stabilized in ED and in fact everywhere else in the UK this spring. But the housing market is being artificially supported by the government's various economic stimuli, especially very low interest rates. The thing is, interest rates can only go up from here, so the long-term outlook is still poor. If the UK does go begging to the IMF, we may end up in the same dire straits as Iceland, with interest rates shooting up to 18%. That won't be very good for house prices. Even at their current level 20% below peak, UK house prices in terms of average salary multiples are still higher than they ever were in the late 80s boom. We've a long, long way to go before they fall back to levels that are sustainable in the long term, and it won't be a smooth ride down.

Anyone know what the average fee being charged by ED estate agents is for selling a house or flat? I would also be interested to know who is cheapest and most expensive. Might be hard to establish the answer, as I think some EAs negotiate a different fee for every client. But perhaps we can get a bit of transparency on the forum if enough people respond.

I cycled in and out of central london and found the main roads OK as they are mostly clear, but the occasional patches of slush here and there in cycle/bus lanes and near kerbs or central reservations are indeed treacherous. Early morning will be icy too, making it worse. Not for the faint-hearted. All side streets still impassable.

Main roads now look absolutely fine to my eyes - no snow or ice at all now thanks to all the traffic. And it probably gets better towards the centre of London. Smaller roads and backstreets still out of the question though, especially in mornings when they will be icy.

Would be grateful for any views from cyclists about the state of the roads today. I know that back streets are too icy and dangerous, but suspect that main roads might be fine after traffic has worn away snow, grit & salt melted the ice and a few hours of daylight done the rest.

Train is much better than taxi to gatwick but the service to east croydon (from peckham rye, honor oak or forest hill) doesn't start until about 7.30 on sundays. taxi to east croydon probably quickest and cheapest option.

story here: http://www.independent.co.uk/news/business/news/foxtons-stuck-in-housing-market-slump-1242586.html ... just a matter off time. As there is another thread about Foxtons having a hard time here I am locking this one. - The Administrator

I'm sure there are buyers around. It's a myth that nobody buys in a crash. In reality people keep buying all the way through it, always hoping they've timed the bottom about right. It's also a myth that nobody can sell - selling is easy if you're prepared to undercut the competition. A lot of people seem to be saying that it's a bad time to sell, but I think the opposite might be true. House prices are still much higher than historical norms when measured against salaries or rents. They're still well above fair value, so anyone selling now can still lock in profit from the boom. But i think the psychological pain of taking a hit on last year's values is too much for most sellers, which is probably why only those who feel forced to sell will do so. In the fullness of time, I think today's forced sellers will thank their lucky stars they got out so near the peak.

Jeremy Wrote: ------------------------------------------------------- > Also bear in mind that when the crash is over, > there will be a large number of first time buyers, > who have all been saving their cash, waiting for > the right time to buy. So yeah, I guess the lower > end of the market could be the first to bounce > back! they may well have been saving their cash, but from now on banks will be keeping salary multiples to less than 3.5 and insisting on deposits of 20% (or making mortgages cripplingly expensive at higher loan-to-value ratios) until the risks to banks of further house price falls have passed. This means the market won't truly recover until house prices revert to historic salary multiples and first-time buyers without heaps of cash can afford to buy again.

I'm not convinced the top end of the market will bounce back first this time. The banking industry and the city have been hit really hard in the current recession. We also have a crash in oil prices, which has undermined the market in uber-prime central London, where most of the purchases are funded by petrodollars. Also, if you look at rental yields as a guide to value, they tend to be better in cheaper parts of the market that haven't become as overinflated by the credit boom. House prices to salary ratios are lower in poor parts of London too. This means that cheaper bits of London are going to tempt BTL investors before more expensive areas, and affordability will return to normal in poorer areas too. I'd guess East Dulwich is somewhere in the middle between posh London's excessive prices and grimy undesirable London, so I think East Dulwich will put in an average performance.

estate agents' windows are a great guide to asking prices, but during a crash, asking prices and actual sale prices are two very very different things.

ed_pete Wrote: ------------------------------------------------------- > Headline figures for the UK as a whole are > relatively meaningless because of huge regional > variations. The same applies to the London wide > numbers. > The closest the Nationwide figures get to SE22 is > Southwark as a whole, which again, given the size > of the borough and different types of property are > only vaguely representative and show average > prices down 8%. I'm not sure you're right... The regional variations in the London figures are mostly just "noise" in the data caused by looking at small sample sizes. In reality London functions as two main markets: prime (mostly central) London, where v. expensive property sells to internationally wealthy; and the rest of London, which is much closer to the UK average. Southwark is probably down by about the London average or the UK average.

Evening Standard: "London House Prices Crash" http://www.thisislondon.co.uk/standard/article-23612169-details/London+house+prices+crash/article.do

not just foxtons. I hear that every estate agent on Lordsip Lane is going to be turned into a small M&S boutique-supermarket.

not another bar for breeders, surely? The ED market is saturated already.

there are plenty of parks in the area. Why the need for a bar?

the interest rate cuts are good for existing home-owners but not much use to first-time buyers without large deposits as the banks are still setting mortgage rates high for buyers who need loans of 75% or more. To get the whole market moving up again, Labour needs to push first-time buyers back in and force the banks to reduce rates for high loan-to-value mortgages. But there is a conflict of interest. The government needs to make the banks profitable again so taxpayers can eventually get their bailout money back, but on the other hand Labour now has the power to force banks to lend at unprofitable rates to prop up the housing market. I think that's what they'll do. Gordon Brown's top priority at the moment is to close cameron's lead in the polls, which can be done by appearing to "rescue" the housing market. Once he gets reelected he can let the house price crash and deterioration of the UK economy resume.

EDOldie Wrote: ------------------------------------------------------- > Simple question then, with interest rates falling, > possible tax cuts on Monday. Will it be enough to > make people feel better off and start to spend, > most particularly on property again? > > People must be thinking that property is starting > to look, if not cheap, better value than 18 months > ago. Is there another boom on the way? I'm sure Labour would like nothing more than to reinflate house prices in time for a general election, and they will doubtless throw absolutely every weapon at their disposal at the mortgage and property market to get people buying houses again. But in the medium and long term, house prices have got adjust. The boom was fuelled by debt, and the UK will have to deleverage and start saving again, which means a major adjustment is inevitable. You can't defy gravity forever.

Mick Mac Wrote: ------------------------------------------------------- > Josh - You have just described the sub prime > mortgage lending, which as I said, were the > abormal economic circumstances that led to the > crisis. > The sub prime issue, when widely defined, includes > the original reckless lending of US (and other) > banks which led to higher house prices rather than > simply the losses incurred by banks as a result of > investing in products which included sub prime > debt. > I think we agree that the sub prime issue both > originally fuelled house prices (banks' > irresponsible lending) and then brought about a > crash (sub prime losses hit banks balance sheets > and banks rapidly adjust their lending criteria) > which results in more expensive mortgages and > house price crash. but it wasn't just the subprime crisis. Banks had started using wholesale funding to lend so that they could compete more aggressively for market share. the likes of bradford & bingley and HBOS had lent up to 35 times more than they had on deposit. It was inevitable that the house of cards would eventually collapse, but the bankers carried on doing it because they only had their sights set on very short-term gains, i.e. their next bonus. It was like musical chairs, with the housing market in the middle. The subprime crisis in the USA was just one symptom of a totally dysfunctional system, not the root cause of the problem.

Mick Mac Wrote: ------------------------------------------------------- > I'm not sure the house prices had actually peaked > had we continued to experience "normal" > circumstances. What took us outside normal > economic circumstances was the sub prime positions > of the banks and the subsequent increase in the > cost of borrowing which made the monthly cost of > repaying a mortgage unaffordable, however now with > rates in decline houses would once again be > affordable (albeit expensive) if we had normal > mortgage lending by the banks, which we don't have i think you're quite wrong here. The circustances you describe as "normal", i.e. banks recklessly lending huge amounts of money to anyone and everyone at low rates, were far from the historical norm. The subprime crisis, UK house price bubble, and house price bubbles in many other countries were caused by banks inventing investment products (mortgage-backed securities) with unquantifiable risk, which in turn was stoked up by low interest rates. That era of crazy uncontrolled lending has had disastrous consequences and is now over for good. We are now returning to normality again. The idea that house prices will "rebound" as as daft as the idea that banks will start pumping out credit at 2007 levels again. It aint gonna happen for a long time!

i have to admit, there's something not quite right about halifax. Won't be sorry to see them go.

Don't do it. Bad place to be in a recession, and your home will just be a bolt-hole as there's nothing whatsoever to do in the surrounding area. Do yourself a favour and carry on renting (somewhere nice) and saving.

the need is greater on the SE22 side of the park. Most people in Nunhead can't afford to run a car, let alone buy one, so the traffic is consequently much quieter in SE15 than SE22.