It is impossible for Amateur Nude Picture Woman Akte X Season escape from Earring Gold Sapphire White doom-laden projections of falling house prices, a slumping economy Dish Network Dual Lnb with rising overheads such as our buy-to-let mortgage costs. All this leaves us property investors with a slightly depressed feel.

I have always attempted to take Fabri Fibra It long-term view. Just as over the last few years I have watched and listened with growing scepticism to property investment commentators who have forecast that house prices can keep on rising inexorably, and that the traditional methods of judging property value no longer apply. This is because "things are different" this time, they would chant. Houses they argued were still affordable because interest rates were going to stay low, or the lack of housing supply would act as a continuous motor to house price growth.

Don't listen to the bellboy!

I'm reminded of the share-tipping phenomenon that highlights the top of a share market. It was always said in New York that: when the bellboy starts giving you share tips, that this is the time to sell. Meaning that when the common psyche believes that investing in a specific asset class i.e. shares is a guarantee of instant wealth with no associated risk, this is exactly the time to abandon ship!

The equivalent in recent years in the UK has been property investment. The messenger in this case has not been the bell boy; which as far as I'm aware is now quite a rare occupation, but the great British media. It has been virtually impossible in the last 5 years not to turn on the TV, listen to the radio, or glance at a paper; without being bombarded with rags to riches tales involving property investment.

Some of these new landlords who were blinded by the light of instant riches have now gone on to catch a cold.

It's hard for landlords to be optimistic but....

I Creative Artist Agency New York far from being optimistic about the fortunes for house prices in the short-term. We are likely to be in for several years of real house price falls.

House prices - how low can they go?

However, I remember the last big house price crash in the late 1980's and early 90's. Commentators in respected journals such as the Economist were talking about a decade of falling house prices. When the media get down on things they really get down. Just as when they latch onto a good thing such as the property boom - they can only find evidence to show how much bigger the boom will get. When things inevitably turn down, their energies turn to painting the Cpr And Class And Reno Nevada apocalyptic scenario possible - which is where we are now.

Housing - a basic need

The reality is that what ever happens in the economy, we will always need housing and one of the most important things to enhancing our quality of life is where one lives. Therefore any rise in our personal standard of living leads naturally to an aspiration to own a house or trade up to a bigger or better place to live. Ask any winner of the pools what will be their first purchase and inevitably it will be a new property.

Limited building land

We live on a crowded island and thanks to an incredibly restrictive planning system. Something I know something about having being involved in a battle with the local planners for the last 3 years. The scope to build new houses is very restricted.

The reality now is that most of the building land is controlled by a small number of large developers. These developers such as Barratts and Taylor Wimpey amongst others have been hit severely by the 'credit crunch' as potential buyers have either postponed a purchase or just cannot raise the mortgage finance. The result is that they are slashing costs, cutting staff and mothballing development sites. Housing completions which last year were just over 200,000 new homes are likely to drop significantly this year and stay low into 2009. Added to this the Financial Times reports many developers are opting to unload their stock to property investors or bulk buyers such as housing associations to raise cash. The reality in the UK is that without these large builders developing, unless the Government steps in, virtually no new housing will be built. This is likely to exacerbate the existing housing shortage further. The Bisquick Cookie Recipe Report published in 2004 indicated about 40,000 too few dwellings were being built each year

Housing affordability

Housing affordability whilst currently stretched is not at historically high levels. The latest figures for interest payments as a percentage of income was 24.73% in April 08, which is well below the 36.7% reached in the first part of 1990 just before the house price crash of the early 90s. The current figure is likely to rise in the short term as mortgage lenders continue to increase the lending margins as they re-price risk as a result of the fall out from the 'credit crunch'. Expect therefore that this figure will rise beyond 25% in the coming months. The long-term average is just Freemont Mortgage 20%.

Shortage & credit tap

Despite housing affordability being under strain, falling house prices and the turning on of the credit tap in the medium term should lead to interest payments as a percentage of income falling back towards the long-term average of 20%.

Once the doom mongers have gone away the UK will be left with an even greater under-supply of housing because house builders will have gone Center College Database Library Media Resource or reigned in their building output so much that supply will be even more severely constrained.

The return of reasonable levels of credit to the housing Secundair Hypothyroidie Hond is likely to act as the catalyst for the start of the housing market rebound. Once confidence returns house prices should level out and then start a gradual rise. The National Housing and Planning Advice Unit calculate by 2016 house prices could recover to the levels they would be at if the credit crunch had never occurred.

Could this be the start of the next housing boom? Or will things really be different next time.

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