The Housing Market WILL Crash Soon

The Uk Housing Market Update for July is here! With some important information you all need to know friends. Today we look at the quantitive easing effects, the ticking time bomb of mortgages, lenders pulling mortgage products along with why a property dip in prices still wont be the solution for prospective first time buyers.
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The UK housing market and the impending crash that cannot be avoided. Over the past nine months, there has been a debate surrounding the possibility of a housing market crash, with some suggesting that certain factors could prevent it. However, recent developments have made it clear that those hopes are unfounded. The Bank of England's decision to raise interest rates to five percent, the highest level since September 2008, has had a profound impact. In addition, the rising core inflation has spooked the markets, leading to a shift in the narrative and a prevailing sense of fear and panic.
One of the significant factors driving the housing market crash is the Bank of England's decision to increase interest rates to five percent. This rate, which many people never expected to see again after 15 years, has become the new normal. Furthermore, the anticipation is that interest rates may continue to rise even higher. The rise in interest rates is primarily driven by concerns about core inflation rather than general inflation. The cost of services and the demand for wage increases have led to an alarming increase in core inflation. These factors have prompted the Bank of England to take action, and further rate hikes are expected in the coming months. The cumulative effect of inflation over the past two years has already done significant damage to people's disposable incomes, making it increasingly challenging to afford mortgages.
Government's Stance on Bailing Out the Housing Market
There was a prevalent belief that the government would step in and save the day in the face of a housing market crash. However, recent statements from the government have made it clear that they have ruled out any bailout for the housing market.
Market Panic and Negative News Stories
The prevailing narrative in the market has shifted dramatically. Fear and panic have taken hold, resulting in a cascade of negative news stories about the state of the housing market. These stories, combined with the increasing annual house price drops, further contribute to the overall pessimistic sentiment. Even if house prices do not fall significantly from their current levels, the lag in statistical reporting will create an exaggerated perception of the annual growth gap between last year and this year.
The Inevitable Crash
When examining the Royal Institution of Chartered Surveyors (RICS) house price index, a clear pattern emerges. The current trajectory closely resembles the period leading up to the 2008 financial crisis. However, this time, the drop is likely to be more significant due to the inability to rely on low interest rates and quantitative easing as in the past. The consequences of the growth and unpaid pain of the last 15 years are now coming due. Interest rates are set to remain high, further exacerbating the damage already inflicted on the housing market. All these factors indicate that the UK housing market is in for a substantial correction, which will extend throughout 2023 and likely into 2024.

[@TheAnxiousInvestor]

Hope you’re all well friends. Some updates since last week on the market here!

P.s. follow the instagram.com/the_anxious_investor/ if you’re on IG

[@fizywig]

The worst effects of the downturn and looking like a property crash will occur in areas for areas like Newham , Barking and Dagenham East London, where asking prices for typically very ordinary terraced houses were going for 500K. Recently sold my rental property in Eastham, wheeas neighbour with identical house, better condition, was asking 520K, I sold mine for 465K but reduced to 455K to get a sale quickly before s'''t hit the fan. Estate agent said 465 was probably best proce to get an actual sale this year. Big family homes in middle class sought after areas where there is a severe endemic shortage of supply like here in Edinburgh will evade the worst of the downturn maybe suffering only a 5% drop in next 1.5 years.

[@border304]

Edinburgh will be pretty resilient. I went on the market recently at start of June. Viewed the same day. Offer accepted couple of days after that. Renting is crazy in Edinburgh so people still buying.

[@adrenalineisbrown]

I got 8% salary pump which is extra £180 per month in my pocket after tax. It helps but still not enough to put me back in position I was 2019-2020.

[@mackenzie99david]

I'm a cash buyer and happy to put my feet up for 18 months and then revisit the market then. I'd be happy to just go back to pre covid prices although in a number of areas that would be a drop of 30%

[@TheAnxiousInvestor]

Cash to buy when the times right should put you ahead of the game. I wish you well

[@rakeshmehra3657]

Same here couple hundred k cash ready to buy

[@jeremyncrm2012]

I’m sitting on some cash here in America but I don’t see us having a change any time soon, there’s just such a small supply compared to demand 🤷‍♂️

[@border304]

Prices already way lower than the crazy offers happening in lockdown. People overpaid. 2 bedroom villa where I am is around £160k. I saw one go for £230k in 2021. Mental.

[@davidjones190]

Most places in the UK, it’s still more expensive to build than it is to buy new regulations and huge utility charges are inflating building costs so therefore I can’t see the price of houses coming down too much!

[@mattjackson777]

The issue with UK property isn’t the interest rate it’s the house prices. Ultra cheap debt and speculation lead to properties selling for more than double what they’re realistically worth compared to historic long term inflation adjusted earnings to house price ratios. Government and banks have thrown every gimmick possible to keep the bubble inflated (help to buy, ensuring ultra high immigration, lifetime ISA’s, restricting house building, stamp duty holidays, banks lending more than 3 times salary, etc) but all this has done is delay the inevitable crash and made that eventual crash even worse as more and more buyers enter the market having taken on far more debt than they can afford. What needs to happen now is to do the right thing and allow the housing market to crash back to realistic pricing, help those who are in significant negative equity and regulate the market going forward to prevent another unsustainable bubble. The bubble has been going for 20 years now and people forget just how out of touch with reality prices are for first time buyers, it’s time for this madness to finally come to an end.

[@johnrandle8365]

How can you mention high immigration what planet have you been on throwing that in the mix you ask the farmers where the workers that are needed tipped out by this crazy tory govt that doesn't seem to know its head from its arse .

[@callumtyler686]

I've not watched the video yet but I'm assuming it hasn't crashed yet because plenty of people are still on their fixed term mortgages. Won't be till they all renew and realise they can't afford the house they're in and then need to sell up

[@TheAnxiousInvestor]

Let me know your thoughts once you watched it 👌🏽

[@theconspiracyfactorist.144]

2.7 million people in the UK will be insolvent by the end the this year.

[@AndyLowe-net]

It's only really people on high LTV mortgages with fixed terms about to end that will need to sell

[@CryptoDegening]

🎯 you’re right they don’t happen overnight. It’s brewing up nicely for the 📉

[@TheAnxiousInvestor]

Agreed

[@jesse_-]

Unless over 5m homes are built right away, to meet the demand, home prices will not crash. The dodd-frank act was the beginning of the inventory issue, and this inventory issue is not a new revaluation, but the result of government regulation and over reach. This is fallout from 2008. Yes, we are still feeling 2008 right now, and way too many people are ignoring that. And, Thames that voted for the party that is responsible for that, have not right to complain about it.

[@edli323]

I put my rental property in Manchester for sale 2 weeks ago. My asking price was 185k. The current tenant is paying £800 but he is continuously late for rent and I decided to let him go. The current market rent is £1000 in that area. It generated lots of interests and I received a cash offer of 182k just 2 days after it is on the market. But after thinking twice, a gross rental yield of 6.5% is still very attractive to investors, and i decided to withdraw from selling it. My point is with consistently high demand of the rental market, rent is a strong supporting factor supporting the market, especially for property price range under 200k. I doubt it will be a all spectrum crash/drop, but I do think house prices from 300k up may have a correction in the next 1-2 years.

[@kombe971]

Only cos people from London moved to Manchester in the pandemic. They’re used to paying those prices

[@kombe971]

Only cos people from London moved to Manchester in the pandemic. They’re used to paying those prices

[@TheAnxiousInvestor]

Thanks for sharing this. Some good points raised. Everyone has a different ROI/Yield that they are seeking so for some, 6.5% is perfect, for others its higher and I imagine some may even choose lower depending on their circumstances. I think it was last weeks video where I went into more specifics around areas differing and the importance to recognise they wont all react the same way (up or down). Good luck with whatever you choose to do.

[@yington]

Why is that gross rental yield attractive to investors, when you can get 6%+ risk free in fixed savings accounts?

[@kombe971]

@@yington because rentals have cash flow

[@FreaksSpeaks]

here are so many vested intrest on the housing market. It will take a while to crash. Once the tide is turned, no one knows where it will end.

[@TheAnxiousInvestor]

Valid and fair points

[@bumfluffmcregor3730]

Doesn't help first time buyers the payments are bigger unless they've got hundreds of thousands in the bank

[@TheAnxiousInvestor]

Yup that’s the truth.

[@user-wj4et6gh5n]

Agree with your sentiment. People simply borrer too much simply because they had thr budget or rates were low and coule afford to forgetting about wheb rates increase. I cant see it being a market wide crash. I think itll only be on larger properties where people thought they will be WoF for ever. If you're an ex local property buying low price high rent youll ride it out.

[@rubyj5843]

Great video and thanks for answering about first time buyers

[@TheAnxiousInvestor]

You’re welcome. Hopefully once rates can stabilise and if prices do correct, or come down a bit more it’ll give FTB better options to buy. No stupid 5% schemes too lol

[@tonyadams8812]

@@TheAnxiousInvestor 'Why Why The Housing Market Hasn't Crashed YET But Will Soon' but yet you say 'if prices do correct, or come down a bit more' . The operative word in that statement is *if*

[@shazoids]

I can only speak to IT in terms of the job market and it is absolutely dead worse than Covid when everything grew to a halt. It is grim so so grim. Where there where 10 applicants for a role there are literally 200-400, I haven’t seen wages rise in 13 years. We are truly fecked.

[@nicholaspostlethwaite9554]

Rates need to be a lot higher yet. Just a fantastic good thing all round. Rates must return to above inflation as was normal. Tiny numbers may have difficulty, they really are not important. Most people are far too well paid and caused the problem by being able/permitted to borrow so much. Up to half the prices will be normal. Really does not matter, you that bought expensive still have the house you wanted at the price you were willing to pay.

[@victoredwards3959]

So many KZbinrs are jumping on the word property crash because the KZbin algorithm encourages this and pushes the video out, but can someone explain to me , what’s exactly people definition of property crashes? . As a property investor, my view and opinion is that the property price will drop by 15% to 20% . Majority of home owners and investors will simply sit out . First time buyers are definitely frozen out of the housing market for the time being. The housing Market will be stagnant for a long time. As they say property investment is a long term investment. Both for investors and home owners. People should relax, interest rates will eventually drop , inflation will also come down. Yes there will be people who will be forced to sell and their will be some repossessions. But the market will not crash nor will the Uk economy collapse.

[@TheAnxiousInvestor]

I did insert the property crash terminology into the video so it does state the % there. Think it’s midway through. It helps get the video views absolutely but I hope the content and information around it isn’t a waste of anyone’s time. I spend a lot of time researching, planning and editing my videos to give people updates as it’s a popular request from my tiktok and Instagram audience.

[@FreaksSpeaks]

Death, Divorce and Debt will force some to sell but there won't be enough buyers due to interest rates. next year's will be lost for "investors". 😅

[@victoredwards3959]

@@TheAnxiousInvestor . Apologies, if my comment comes across as a criticism, no offence intended. And I did enjoy the video.

[@bumfluffmcregor3730]

It crashes every seven years or so boom and bust it's just how it is if only you were right and it just went steady but that just isn't what happens

[@andrewtaylor6737]

Delusional ! The Uk is broke, house prices will be the last of our worries !!

[@user-sf7kl9uh7k]

The only way is up, baby For you and me now The only way is up, baby For you and me now Bubble Burst on the way, I have no faith in the slight drop of inflationary pressures.

[@Priesty1997]

I'm 25 and I can't afford to move out 😢

[@TheAnxiousInvestor]

You’re not behind. Many people can’t move out until later. Also I hope you’re able to save whilst at home now. Take advantage of it 🙏🏽

[@Priesty1997]

@TheAnxiousInvestor I'm saving as much as I possibly can, that's pretty much my main target.

[@belln700]

Thank you You sound like a narrator on a History channel I listen to 🤔

[@TheAnxiousInvestor]

haha, thanks for watching. Narrating isn't my forte but i hope the information is always useful

[@belln700]

@@TheAnxiousInvestor Hmmm, you sound exactly the same - even say the same thing "so, my friends." You must have a voice double 😄 Thanks, again for your insight on the housing market.

[@TheAnxiousInvestor]

@@belln700 haha i feel sorry for anyone who has the same accent as me. Have a nice day

[@RickP2012]

A fair number of the companies that I work with, increased wages across the board by 10%. This will have an impact on the amount people can borrow, although they're not really any better off than they would have been a few years ago. If this trend continues it would point towards real term falls rather than norminal falls in the housing market.

[@TheAnxiousInvestor]

10% is better than a kick in the teeth. Main problem is inflation is higher than the reported amounts in terms of when we look at how far the costs have gone. It’ll be interesting to see how affordability measures change though.

[@amadali4036]

My salay went up by 20% this year around 13% last year, i'm also expecting a similar increase next year once i've completed my qualifications. I'm currently not looking at investing in property as i havent had the time to research enough about everything but i'm hoping early next year i'll be able to spend sufficient time to learn what i need and that will also give some time for the market to hopefully settle down. really enjoy your videos as updates to whats happening in the markets, where would you suggest is the best place to start learning everything about property ?

[@TheAnxiousInvestor]

Hey mate so obviously I’m biased and would say some videos on here. Bear in mind a lot of educational ones (not the reporting ones) are tailored at newbies. The links in my description also have some tools / resources that may help you as well. The internet google, podcasts books etc can help with some theory based practice too. I learned most my stuff via doing though. That’s what I’ve included in my program (in bio) and what I try to share for free on the videos. If there’s something specific let me know.

[@cobbler40]

So let’s look at prices falling by 35% will there be few buyers. No there will be lots of buyers resulting in prices rising. Also property long term is a hedge against inflation.

[@TheAnxiousInvestor]

A drop in some house prices by let’s say 20-30% may not be achievable for the average person on the current interest rates. Affordability is a factor right now. However big players or those cash rich could certainly take advantage. It’s just about whether they think that’ll be the opportunity, or they’ll be better opportunities ahead when more pain kicks in.

[@robhemsley9181]

House prices will fall minimum 20 % by close 2025 and will not recover for many years

[@cobbler40]

Yes but they will recover long term

[@jesse_-]

In other words, “all of us doomsayers were wrong about the crash, we are still going to predict a crash, but we need to reset the timeline.”

[@abdulrahman31350]

Great news. Will buy the dip 🎉🎉🎉🎉🎉🎉🎉

[@TheAnxiousInvestor]

💪🏽💪🏽💪🏽

[@taiwong1186]

My partner is looking to remortgage but is worried because he has a rate of 1.10% at the moment. Any tips??

[@TheAnxiousInvestor]

I would speak with a mortgage broker about the options. I would also prepare to be paying significantly more sadly. Hopefully it’s gone up & there’s some equity growth 🙏🏽

[@Paul-zu2he]

Yeah. Earn more.

[@SilverWong-yo5iu]

Sell it asap, ahead of the market

[@mendipfox1650]

Does he have any assets he can sell? Flash cars, flash phones, flash watches? If he does, liquidise them now ready for the inevitable financial hammer blow….. I think that’s as good as advice your gonna get in real terms. Also, cancel any booked holidays, get refund and cancel any non essential subscriptions. Cancel the gym membership, buy some running shoes. There’s a few things everyone can do to make it easier.

[@andrewrichards4472]

Building or renovating houses is expensive due to pandemic, inflation, etc so there will be no crash for well maintained houses n outside of London! Why else? The UK government negotiated excellent support package for anyone caught out by interest rate rises. There is a very slim chance they will allow a house price crash, especially before an election. Besides they can use tax payers money, pensions, etc to ensure no one is forced to sell. Not unless they want to! And who would sell for less than a house is worth unless they were desperate. Inflation, WW3 & pandemic now means new build houses cost considerably more than ever before. Do not expect much discount on house prices except those needing significant renovation and maybe some 500k to 1 million plus homes in larger cities. Why? People escaping big city as employers move into cheaper areas! This is not even close to the house prices crashes of yester year. We are post pandemic in WW3, most of our planet has been closed for 2 years and we've had a significant increase in excess deaths within the healthy blue collar working population. Time to wake up and realise property is a very safe bet, just before a stock market crash!

[@cobbler40]

People with negative equity cannot move. Won’t people just sit tight ?

[@TheAnxiousInvestor]

They could try but if the bank wishes to repossess then they’ll have no choice but to move

[@cobbler40]

Doomsday scenario

[@TheAnxiousInvestor]

@@cobbler40 yup sad but likely in many areas

[@coolmonkey619]

What a time to be alive

[@TheAnxiousInvestor]

Haha! I said this a few weeks back myself!

[@user-sf7kl9uh7k]

It's going to crash hard

[@jamesjones3371]

Been looking into park homes but cant mortgage pitch fees are insane and they go up damn no way out in uk as thing is i cant get a housing associatiin rent stability flat

[@cobbler40]

If you have a static caravan you have to replace it after 40 years. Also they depreciate at about 25% PA

[@blxck3978]

Are we considering that people would have paid down principal over the last 2/5 years which would offset some of the impact of rate increase

[@TheAnxiousInvestor]

Over a 25/30 year mortgage you hardly touch principle in the first few years. You’d hope there is some capital appreciation though.

[@lugo_9969]

The covid lockdown crash ..... it was delayed but Inevitable

[@neotropos]

Inevitable

[@TheAnxiousInvestor]

Agreed

[@fieldmouse1975]

I'm in a possition soon to buy a home... House prices are up 23,000 approx on the size and area of house I'm looking for since 5 yrs ago! Should I hold of a year before I buy incase they come down in price?

[@TheAnxiousInvestor]

The problem with house prices is it depends on so many factors. Certain areas will always outperform other areas and prices coming down as mentioned in the video in terms of timing and amount can never be accurately guessed. All we can do is look at the markets, assess trends and behaviour of lenders, buyers and sellers and try to come to some sort of a conclusion. My feeling is rates aren’t finished creeping yet so you I would urge you to see what you can afford & what works for you in terms of finances etc. Hopefully the info in the video will help with that, especially around buying too much

[@vg3222]

I would just hold if you can... worse case is that the price stays the same over the next 6-12 months... there is such a marginal chance that properties will INCREASE in value over the next 3-12 months...

[@FreaksSpeaks]

House prices are going not where for next 5 years. Pain is yet to come.

[@TheAnxiousInvestor]

@@FreaksSpeaks when you reckon it’ll be close to max pain?

[@FreaksSpeaks]

@@TheAnxiousInvestor my guesstimate next summer. That is when Another 2 million mortgages have to be done again. We only 10% of them to experience difficulty in re-mortgage process. Basically free money time is over and rates might call back 4% some time late next year.

[@johnrandle8365]

You are likely to see a lot of houses on the market clients giving back their keys big trouble ahead for the tories flat on their face .

[@jakeblair4215]

Itll crash in london not rUK

[@rorus9530]

Unless the uk suddenly doubles in size, there will be no crash.

[@SilverWong-yo5iu]

HK is smaller than greater Manchester and had never double in size, yet it's property prices had dropped by 70% from 1997 to 2003. How does that sound? Demand outstrip supply theory fails in downward cycles.

[@rorus9530]

@@SilverWong-yo5iu That is a terrible example to be used as a comparison.

[@SilverWong-yo5iu]

The shocking similarities is affordability matters, not supply. With history high house price to income ratio, couple with cost of living crisis, mortgage rates jump to 15 yr high, demand will shrink faster than you think.

[@RabJ208]

Good stuff. Yeah if they don't get inflation under control - interst rates will inevitably continue to rise which is what I believe will happen.

[@connormcleod9595]

Wait till 2025 and get the property 30% less. Let time do the negotiating.

[@sevecc939]

On the chart at 6:26 it shows us in aboom phase until 2025, peaking at 350k, but prices have already started to go down at about 295k in 2023??? It does follow the cycle, but the years and times are off and not reflecting current downturn. It certainly isn't continuing at that trajectory.

[@watchmanendtimes]

What about big banks buying?

[@TheAnxiousInvestor]

Mentioned this on last weeks video mate & also a reel I released today (shorter video)

[@andrewtaylor6737]

No more free money, you're on your own now and no sympathy as the writing has been on the wall for years but the sheeple were to blind to see. The hire cars will have to be returned back to the lease company's, this is going to get real ugly ! Great vid, but some still think house prices will ever recover in a broken Uk.

[@TheAnxiousInvestor]

I think a reality check is gonna hit people very hard & those with cash, institutions & banks will be there to take advantage.

[@sheredeu]

A bailout would be the straw that breaks the camels back!

[@TheAnxiousInvestor]

Agreed. State intervention on mortgages would be unwise and could (not an economist) mess up inflation even more. By that I mean if they borrowed to subsidise mortgages. It all just feels shambolic if I’m being honest lol

[@TheFourSatoshis]

You did your research on the cycle I see 😂

[@TheAnxiousInvestor]

Lol I’ve always known about the cycles. Been in the game for over a decade. Even did a video over a year ago 👇 kzbin.info/www/bejne/aqjImmdpiZp1rs0

[@yington]

House prices could fall up to 60% in some areas. Agree or not?

[@razhazel1233]

I dont trust anyone that says "my friends"... you sound like a politician 😉

[@TheAnxiousInvestor]

Haha you ain’t gotta trust me man. You’re welcome to not even watch the videos.

[@theconspiracyfactorist.144]

You got no friends then?

[@vinny6967]

Love how none of these experts are billionaires if they read the market so well how come they don't seem to be able to make real money from it

[@TheAnxiousInvestor]

I always wondered how do you become an expert lol. There’s loads of investors on social media who claim that status too.

[@paddyoshocknasey8068]

It's going to be worse than 2008