The problem with letting it go now is a high risk of recession - something which nobody except greedy loaners and those who take loans well beyond their means deserve. The only thing keeping the market from completely crashing right now are strong economic fundamentals. If people soon find out that easy credit is dried up, and most can't pay for their loans, they'll probably end up spending less on commodities. It would be a massive drop until the prices (due to supply/demand) reach an equilibrium with buyers. You'd also have to wait for banks to make most of their money back. There is an estimated 7 million subprime loans I hear. Now, imagine 7 million $200 000 loans that can't be paid back. That's $1.4t! Of course, that's a simple calculation, but you get an idea of how much money is missing right now.
Mr Da Dego told me I read that they did $38bn or so early on Friday, so maybe they did a second batch?
House prices are just nuts... really, i haven't a hope in hell of owning my own place in the near future, still i'm throwing money down the pit with renting privately. Housing inflation is not even in the same league as earnings, people are being offered 50yr full term mortgages now! Really that's just well stupid, I'm 26 now, having to pay off mortgage until I'm 76??? i think not baby puppy, Those already on the ladder are the most secure of all, those with family money are laughing, those who happen to live and work in an area of socio-economic growth may as well up-sticks and move out; Either that or do what seems to be the only way into this market, apply to the local Council Housing department at 16 and claim custody for 4 kids, stay there until "right to buy" takes a hefty discount and sell up for a tidy profit! Sure its too late for me, try getting a decent house at 26 when your renting on your own... :/
Well, right now, it'd be a good idea for real estate investors to prepare a sweep of American houses since the prices are expected to drop, and banks would have to sell as many of them as possible to a crowd with little credit. Perhaps borrowing from Japan (as they have extremely low interest rates), and buying American?
Try Hull (I know, I know, but hear me out). Avoid the estates or areas wih obvious subsidence problems; get a multi-bedroom terraced house close to a school and amenities. Then sell after a year or two and move to something smaller in Cottingham (at the edge of Hull), or move to one of the little picturesque villages just a few miles down the M62. Then move to Beverley. Presto: you've got a roof and some equity.
