Thursday, June 18, 2009

Burgess Hill House Prices To Crash!

Don't believe what the media reports tell you. There are no green shoots for the UK economy, UK house prices are not merely bouncing along the bottom before a big rise. It has just been announced that in May, UK retail sales DROPPED 0.6% from April's figure. It seems the green shoots being reported by those with an interest of wanting to keep house prices high have been mistaken, these green shoots are actually gangrene setting into the dead economy.

The Press Association
The sluggish housing market however is still bearing down on household goods sales.

In the three months to May this was the hardest-hit retail sector, showing a record decline of 7.3% on a year earlier.

Experts warned that pressure on the consumer would increase and is likely to impact the high street as unemployment rises and households cut their cloth to pay off debts piled up in the boom years.

Vicky Redwood, of Capital Economics, said: "We wouldn't be surprised if this marked the start of a period of rather weaker sales growth than of late.

Logic may finally be getting through to the media reporters. It's really quite simple. The majority that purchased property over the past 6 years have huge mortgages, with monthly repayments at such a level that they have a complete lack of disposable income. When people have a lack of money, it's logical that the retail, car and travel industries have to suffer.

Once again, the banks have to be applauded for lending such high levels of money to buyers that purchased beyond their means in order to get a home. A big pat on the back to the Government who did nothing to stop the banks from being greedy.

If you live in Burgess Hill and are looking to get on the property ladder, DON'T! The Government can't talk up the economy and house prices forever. Why buy a properly now and be consigned to being another debt slave to the country?

The Bank of England are still holding the base interest rate down at 0.5% punishing those careful savers and in turn bailing out all those buyers over the past six years that overstreched themeselves to buy something they couldn't really afford. As soon as the interest rates go up, those on variable rate mortages will be hit hard, with many defaulting on their repayments. The result will be a flood of homes appearing on the market at more reasonable prices as owners compete with each other to sell their homes to reduce their debt.

Liar Loan heaven -
Former HBOS mortgage chief Michael Bolton has claimed that up to 80 per cent of mortgages lent by the group before the credit crunch were accep- ted without proof of income.

How many of those 80% do you think lied about their income in order to get the huge loan that they required?

Good things will eventually come to those that wait. Careful savers and patient first time buyers will get the sensibly prices houses that they deserve, and those that over stretched themselves will be forced to sell their homes or be repossessed. However, don't expect this to happen just yet. The Labour government will keep patching things up until the next general election in their losing attempt at trying to stay in power. It will then be the victorious Conservative's that will be running the country when the sh*t really hits the fan.