UK Housing Market Heading for a Property Crash

Just because a crash hasn't happened doesn't mean one isn't on the cards. There is much tighter supply in Japan and yet property prices there are still only 25% of what they were at the height of the boom 17 years ago. There hasn't been an increase in homelessness in the UK, rents have risen a lot less than purchase prices and if there truly were pressures on supply neither of these things would be the case.

Cloie, I'd suggest you stop listening to the property only goes up brigade and open your eyes to the realities of speculation on any asset in limited supply (oil, gold, grain, houses).

Hope that helps!

Whilst the US and partly Europe are experiencing realestate pricing collapse, so why in the Ocenia region such as NZ and Australia are the house prices climbing to the roof top ! Can anyone please explain if there is a sure bubble occuring in these places and would comparable results be the same as that of these places mentioned that had crashed their market values !..............Ricky

What do you mean gays in real estate ?

i want to buy but houses in the UK are too expensive, so I am looking forward to a big crash !

50% ! off !

People who think they are going ever higher are fools ! house prices in the UK are now ridiculously high ! ridiulously !

The most expensive postcode areas (to buy a one bedroom property based on local average wage) are;

1) BR 10.12 times salary mortgage required

2) TR 10.05

3) SW 9

4) NW 8.26

5) E 8.17

6) TQ 7.66

7) HR 7.61

8) CW 7.42

9) EC 7.34

10) WR 7.12

and the least expensive;

96) UB 4.73 times salary mortgage required

97) HU 4.72

98) DN 4.7

99) WN 4.68

100) BD 4.67

101) RG 4.61

102) SN 4.52

103) WF 4.39

104) BB 4.36

105) HX 3.52

The average for England/Wales is a 6.66x multiple to buy a one bedroom property based on a local average wage.

they used to say not to borrow more than 3.5% your salary, so HX is the only place in the UK where that still applies !

But look at BR (Bristol) TEN TIMES SALARY ! Ridiculous !

Where's postcode HX?

HX = West Yorkshire

I am glad we just signed our exchange and complete in 5 weeks stroll on I cant wait to go in rented and get our outgoings down in Suffolk, I am waiting for the interest rate to bit and it will, the uk debt per average person cant carry on otherwise the bank will own everyone and all that will happen is people will be paying all there earning in interest alone! it has happened in the US and we always follow..

Property crashes happen when investor are selling to investor and they one realised that there is not enough end user to take them all off their hand.

If you really want to see a property crash, look in the direction of Bulgaria for the cheap stuff or even Dubai...

The UK market will most likely slow down, yes some area will see some price drop. This is called market adjustment, not crash...

Further more, historically, no Olympic host country has seen price drop nationally and even less the host city itself within the 5 years leading to the games...

So "I want to buy", may I suggest that you start earning more because I can't see you moving to UK anytime soon if you don't...

Chloie / Frederic - whilst no-one really knows what is going to happen and when unless they got a crystal ball may I please ask who exactly is going to keep this market going? Those who believe in ever rising property market forget two things. Firstly, salaries have hardly been increasing and secondly rents have only increased marginally since 2000.

If there was a real shortage of property then the rents would have been increasing in line with the sales prices. Most importantly, many people are (and almost all investors) are now only paying the interest on their mortgages. The original debt will still have to be paid.

My prediction: unless interest rates start falling significantly there will be a major correction by the end of 2008. In some areas prices will just stabilise but the most over-valued areas could face decreases of up to 30%.

could someone kindly explain easily, why the american market effect the uk housing market.

As fourteen and find really confusing.

Thankyou kindly harriot.

Immigration isnt going to keep prices up because the over 90% of immigrants are working in mimimum wage jobs i.e. about 10k "salary".

I cannot see how the market can continue in its current climate. More and more first time buyers are being priced out of the housing market and no amount of part buy/part rent schemes are going to solve this.

I cannot afford to get on the property ladder and I am on a professional wage. The house I live in has risen by 100k in the past 5 years which is just rediculous. Something has to happen as I can see the market grinding to a hault.

Does anyone else realise that the high value of houses is a little false and that they are valued based on houses actually sold, which could average a high value. If all the houses were sold at once, say everyone had decided to move into the next appropriate house for there needs, these prices would not be realised. Would it not be better for houses to be valued at cost ( a bit like cars, boats , etc ). That way, we would all only end up with personal loans of no more than a fraction of what people are paying for properties at the moment. Is it me or is it all about people taking their share along the line. Borrowing 200,000 rather than 100,000 just on the say of estate agents is ridiculous, with the interest rate for the mortgage bearing little importance. You are already agreeing to pay 100% interest/premium immediately you purchase!

Why build more houses if you are a builder when you can build one at twice the price.

If there is a housing shortage why have up to eight properties sold along my road in the last year? I bet that that number of properties being sold wasn't taken into account and reflected in the value of other properties sold in the area........

I think it is inevitable that house prices will fall in value.

The reason for this is that over the last 10 years they have been seen as a sure fire investment, mainly from BTL buyers sick of being stung by the pensions market, but for everyone clambering on the gravy train to secure a foothold on the property ladder. Housing is now seen in the same light as other stock investment purchases, instead of 'secure homes' to bring up one's family. They have become commodity assets to be discussed as such over a meal and a bottle of fine wine with friends. As such, they will rise and fall to the whims of the market. If you have sucked in to believe they will alway rise in value, well those days are over. There is always a danger when trying to make a fast buck in any situation: it becomes just as easy to lose one too. We need to get back to buying houses to use as homes, not as cash cows to feed the greed.

Hi, it’s not just the housing market that’s going to suffer, if you look at the past year how the government have propped up the housing market and even businesses not to mention our own wages in the form of Family Working Tax Credits… are we living in a communist state???? … Not quite but we have all been brainwashed by the endless TV shows on property prices and have you noticed how the news channels spend hours on the boom articles but only minutes on the crash!!!

Time to wake up UK… we are all sinking… but this time there are no life boats… the Local councils have sold them!!!

We are experiencing the exact same thing in Canada. But for some reason most Canadians still believe that the housing market will forever be a sellers market and that property values will appreciate for ever. Continued erosion in housing affordability in Canada has taking a toll on the ability for most buyers to pay, foreclosures are up double digits. Home owners and buyers where told that prices will never go down, supply will never meet demand, immigration will keep property values up, strong economy, low employment rate……….etc etc. All smoke and mirrors and time will only tell. Canada will soon be in a huge housingcrash just like U.S.A., and the U.K.