Sorry JM, but easy-credit, 100%+ mortgages were one of the reasons why prices spiralled out of control in the first place.

100% of a non-affordable sum, is not sensible lending criteria and the Bank's need to stick to the proper rules of lending and affordability to prevent people falling into the financial hardship that such easy credit measures created.

Prices still have a long way to drop before they reach reality and when Estate Agents start pricing according to value - rather than greed, and measures taken to stamp out Speculative Investors, then we might be able to start making some sort of return to normality and buying places to live.

Posted by Starvin Marvin | 24.12.08, 13:13 GMT

What we need for the housing market to kick start is for the banks to stop holding on to their money and start lending out on mortgages. They also need to be giving out 100% mortgages again to first time buyers to allow them to get on the market and push the rest of us forward. This should get the houses to start selling and once this happens then prices wont be dropping as they have been as people will be able to buy so this should keep them steady. Also people need to think about how much they are offering on a house as before all this happened people where offering up to £100,000 over the asking price, which was madness.

Posted by JM | 23.12.08, 12:34 GMT

They're still looking very silly money for very modest properties. Semis and Terraces are even being listed at the same price as Detached homes - with gardens, garage, utility, conservatory, room for a Pony, etc....!

I'm a struggling FTB and when I offered the Agent (HEA) 4 times my £20k salary PLUS my £30k deposit, (=£110K) for basic semis in East Antrim area, needing totally modernised, I was told "Oh no - we wouldn't be recommending to the Seller that they take that".
That was six months ago, they're still there, nobody can afford them and now nobody even wants them. They can't even rent them out!
Empty properties, rows and rows of them, attracting ASB and rats. Maybe we should all just squat in them - and get them free!

Posted by Wyrie Piddle | 16.12.08, 12:02 GMT

Truth is that there are so many factors at play - interest rates, unemployment, lending ability of banks etc - these factors are all inter-related, in constant flux, no-one can state with any confidence where things are going. I work in financial services, and the eggheads that l meet almost all got it wrong - their theories and technical analyses didn't predict the coming crash in something much more quantifiable - stocks.

Human psychology is ultimately the greatest determining factor in the markets but can't be quantified. We
pretend there are experts who understand the situation by analysing "underlying funadamentals" - useful at times but never wholly reliable.

At the end of the day, no-one can ever really be confident about where things are going.

So you can either sit tight and wait to see if conditions go your
way. Or you can try to call it - i.e. make an instinctive gamble.

Posted by Maoileachlainn | 11.12.08, 18:54 GMT

Has anyone ever thought about a caravan?!?!?!

Though seriously i agree with your point Re: rented accom in Belfast Perky Pat (great name by the way!), but the same could be said of houses people buy. I also agree with your point Re: Community, but this is a bit of a pipe dream....as there has been a real lack of community for years. People have lost that sense unfortunately and it will be very difficult to get back.

I think someone else mentioned the fact that it is a 'home' you are buying, not a ready made money machine. The sooner people get back to this the better. As with any goods or services you purchase, you only buy if you think it is worth it.

Posted by hb | 11.12.08, 09:18 GMT

Mark- the money in the bank is not collapsing in value the way the value of the house is.

If you can sort the crisis in capitalism by getting the banks to "wise up" you will get the Nobel Prize for economics

Posted by maggie | 11.12.08, 08:54 GMT

Quote: mark, 10th December, 2008- "Now is the time to buy."
Just before Christmas. Just at the start of a recession. While house prices are still falling. While house prices are still 30 % overvalued. While unemployment is high and rising fast. While supply of houses for sale is massive.

Really mark? You'd buy now? Or are you just finding it tough seeing the price of your main asset tumble and are desperate for people to start buying to stop your own losses?

Posted by Dave | 11.12.08, 06:24 GMT

The price of property is now at a level where rental income from it is more than having the value of the property in a bank. What investor would sell a property to suffer a drop in income?

At this level investors will withdraw their properties from sale. In the new year when banks finally wise up and start lending the shortage of properties will halt the downward price spiral.

Now is the time to buy.

Oh, I'm not an estate agent or banker but somebody who owns my own home hoping to pass the equity onto my children.

Posted by mark | 10.12.08, 18:53 GMT

hb - have you had a look at the quality of rented accomodation in Belfast? It's quite poor and not a little depressing to live in.

I agree there is no universal right to buy a house but ownership has been shown to be important for building strong communities.

Buying to invest - ie to make money is certainly gone for good. But buying to make an commitment to a community is probably still a worthwhile objective.

Hopefully the end of the housing bubble will make this second aim a realistic one.

Posted by Perky Pat | 10.12.08, 15:21 GMT

no one has answered why the average man / woman has a right to buy a house???

Posted by hb | 10.12.08, 10:08 GMT

MMW - if you're earning £40,000 between you, have no savings and borrow £160,000 you really shouldn't be allowed to make your own decisions

Posted by neil | 10.12.08, 09:43 GMT

hb, the basis of how much you can borrow is your salary, last year, if you are earning around 22k/year you will only get up to a maximum of 70k pounds of mortgage(if you are young & under a long term + 5% deposit (35 yrs)) but if ur let say a GP with 100k/year salary, you can borrow up to 4x bigger. in short, the ladder is too short for people with average income, because the house price is too high at the moment.

Posted by John | 10.12.08, 08:42 GMT

hb, the last time average house prices were around 3.5 times average income was in 2003. 5 years ago. Not 15 as you declare. (source Nationwide). And you are correct about many sales at the moment being from those desperate to sell. With rising unemployment as the recession runs on into 2009/2010, these sales are set to rise in number. The market indices are set only by houses which sell (apart from Rightmove) so whether the sales are forced or not, the average price of a house in Northern Ireland is set to plummet over the next year at least. "Unforced sellers" will be wasting their time if they do not adjust their expectations in line with reported house price movements.

Posted by Dave | 10.12.08, 06:34 GMT

I don't agree with the much quoted assumption that houses will fall in price until they are 3.5 times the average person's salary. A lot of first time buyers are actually couples and some lenders are still lending 4 times joint salary so in theory an average couple can borrow £20K x 2 x 4 = £160K IF they have a deposit.

So the average price is not going to drop to £70K - its more likely it will drop to in and around the £130K mark.

When the economy sorts itself out FTB will have the confidence to buy which will get the market moving again, hopeful without silly levels of house price inflation.

Posted by MMW | 09.12.08, 19:57 GMT

hb - it'll come as news to the economists working at the OECD, Nationwide, Capital etc that the wage to house price ratio is 'rubbish'. It's served as a very good indicator of under and overvaluation in the past. Admittedly it hasn't applied for over a decade but then economists tend to look at long term trends. We, the general public, can't seem to look much beyond short term trends, which is why these cycles of boom and bust continue to occur.

Posted by polythene pam | 09.12.08, 17:21 GMT

Another thing ...this average wage to average house price ratio is rubbish.
1) This has not been the case in England for well over 15 years.
2) And more importantly why should the 'average' man 'own' his house (outside of Ireland and UK the average man in europe certainly doesnt...unless he inherited it).
As for house prices.....take all printed figures with huge pinch of salt. Who in their right mind would sell a house in this current climate? Only people desperate to sell basically! Every week we are told that number of sales has fallen again ....therefore in Statistical terms we have a smaller sample, thus greater distortion in mean prices. Without getting over technical we are talking about a huge confidence interval around what the true average is.
My advice is stop getting hung up on this and rent a nice wee place..works out a hell of a lot cheaper...and you dont have to spend your life dreaming of your own 2 bed terrace in a Belfast ghetto you can call your own!!

Posted by hb | 09.12.08, 14:57 GMT

New X5 as in 'new' to them. (Do people still buy 'new' cars???)

(I personally still think spending £15k on a car is obscene)

Reference why our Public sector is bigger - huge chunks of the public sector on the mainland has been privatised over the last 30 years ....we on the other hand still have translink.

Posted by hb | 09.12.08, 14:47 GMT

property falls in northern ireland have only just started

the bubble has well and truely burst

Posted by Weebobby | 09.12.08, 13:53 GMT

Prices will stabilise when they fall to affordable levels (which I would put money on will an average of circa £120,000) and people, especially first time buyers, can secure a suitable mortgage. For the benefit of everyone in NI lets hope that we reach this stage fast! Also don't read too much into one month's figures - in March 08 the number of Estate Agents reporting falls fell to 71% from 95% the month before, only to increase again to 86% in April '08.

Posted by Jack | 09.12.08, 13:45 GMT

HB - a BMW X5 costs approx £50,000 new. What sort of public sector employee can afford this? A judge? Permanent Secretary to department? Or just someone who's prepared to go without their breakfast to drive a new fancy car?

Can someone explain why we have such a big public sector compared with England?

By the way, bobby, Stormont stopped sending money to Westminster in 1928, not at inception. As for overspend here compared to tax take, can someone enlighten us as to when that began?

Posted by neil | 09.12.08, 13:17 GMT