P
piggy
Guest
This has been something that has been bothering me for a while now. Please excuse whatever naivety lies in this post.
Back in the early 70's my father bought his house for £5,400. Let's just say for arguments sake that it's worth 500k now. I'd say it could be worth more but that figue will do.
That means it's value has approxiamtely been multiplied by 100!!
As far as I can see there are two schools of thought on house prices:
A) They will continue to rise. Period. You can't go wrong with a house. Best investment you will ever make.
or
B) The bubble will eventually burst.
I don't believe in B personally.
However, house prices surely can't keep rising like they have done over the past 30 years. Can they? To even suggest that said house might be worth 3 million at some stage seems ridiculous.
Wages have already dramatically slipped behind house prices...to such an extent that now banks are basing mortgages on disposable income and lending up to 4-5 times salary in some cases. 30 year mortgages are the norm. Surely it can't go on indefinately???
My own theory is that houses at the higher end of the market 700k to 1 million+ will eventually steady off.
Starter houses (say 300k) will be where the real increases will be found. Buy your new house in new estate. As the surrounding area matures over the years so will the value of the house/apartment.
There has to be a cap on house prices at some stage. Anyone any thoughts?
Back in the early 70's my father bought his house for £5,400. Let's just say for arguments sake that it's worth 500k now. I'd say it could be worth more but that figue will do.
That means it's value has approxiamtely been multiplied by 100!!
As far as I can see there are two schools of thought on house prices:
A) They will continue to rise. Period. You can't go wrong with a house. Best investment you will ever make.
or
B) The bubble will eventually burst.
I don't believe in B personally.
However, house prices surely can't keep rising like they have done over the past 30 years. Can they? To even suggest that said house might be worth 3 million at some stage seems ridiculous.
Wages have already dramatically slipped behind house prices...to such an extent that now banks are basing mortgages on disposable income and lending up to 4-5 times salary in some cases. 30 year mortgages are the norm. Surely it can't go on indefinately???
My own theory is that houses at the higher end of the market 700k to 1 million+ will eventually steady off.
Starter houses (say 300k) will be where the real increases will be found. Buy your new house in new estate. As the surrounding area matures over the years so will the value of the house/apartment.
There has to be a cap on house prices at some stage. Anyone any thoughts?