For me of course, that's a welcome indicator

They were only buoyed up by so many buyers chasing after so few properties. Once the owners decide to sell then the supply will exceed the demand and prices will drop. I never thought that the rise in prices had any credibility. The numbers being able to buy will shrink as fewer mortgages are available, the numbers of buyers will not be able to rise appreciably. The news for first time buyers is hold on build up that deposit because eventually house prices will come down to a level worth buying at.

That's the way I look at it too - I don't wanna be paying off a mortgage when I'm an old man if I can avoid it

Although they have fallen this was due partly to the surge at the end of Dec due to the ending to the Stamp duty holiday and the poor weather.
I would expect this to be reversed in the spring. However if interest rates increase soon then there are a lot of people who are hanging on as rates are so low that will be forced to sell if they go up to 3 – 4 %

As for not paying a mortgage until you are old – they way is to start when you are young and start overpaying as soon as you can

That would account for some of the surge late last year. All it has done is brought potential bidders forward to get the benefit of this holiday.


I think that for the next couple of years they could actually rise but the long term prospects are appalling. Banks still have very high levels of debts, Countries are at risk of default. If that happens then many banks will collapse. France and Germany's banks are at risk from a Greek default. If there are any defaults then banks will be even tighter with loans than they already are. Most banks accounts are bordering on fraudulent. The central banks have managed to keep them afloat by printing billions of euros dollars and pounds. It only needs another shock and then the banks will collapse. Also ignoring that risk the government are probably going to go overboard with spending cuts creating another recession.


There will be many who are in serious trouble now and a rise in rates will crush any hope of maintaining any payments. In the US more than a quarter of all US mortgages are in negative equity. Now when you consider that the UK has a higher percentage of debt than the US you have an idea what problems could be lurking in the UK. If the SH1t hits the fan and I think that it will house prices will plummet and then the bargains of a century will be found.


Thats true.

I only really care where the prices will be in September 2014. That's when I'll be re-mortgaging again and need a good LTV (loan to value ratio) to get the best interest rates. Based on a few sums, it needs to be £179k by then to get the best rates which are 60% LTV or below.

Don't I know it

If you can aim for a LTV of 60% you should be fine. I doubt that prices will drop that much, though it could be close. If house prices fell that much interest rates would probably stay low till then.

Although I am at risk of increased rates I am glad I have a tracker against the Base Rate (with no min cap). The current base rate means that my payments since I took out my mortgage 2ish years ago are 1/3 less than they were

In which case you should try and over pay to reduce the LTV next time you switch mortgage.