Crash Coming? Warning from veteran estate agency chief

by kbing

A prominent chief agent warns that record home prices could lead to a housing crisis if lending gets out of hand. David Alexander, who heads DJ Alexander Wing of the fast-growing Lomond Group, gave his insight. He said that the fast-growing real estate market could lead to higher multiples of loan demand, ultimately leading to market stagnation or bankruptcy.

As a result, it says it can even bring in the next few years. The lenders were ready to offer seven times the first salary and five times the second salary for up to 40 years. He also wondered if the news would cause a rapid  bankruptcy as well as a rapid boom.

Veteran Property Chief Insight

“No one wants to deny an individual’s right to buy a dream house for sale in London. In fact, we need to encourage this as much as possible. But we don’t have to have a long memory to know that there is already a very high multiple of income behind us. So, that ultimately led to a major shift in the market, Alexander warns. “The financial crisis of 2008 was also associated with general economic problems. But assuming that real estate value is always valued, lending was an important factor and a mistake we didn’t want to repeat. It was obvious. ”

He continues. “What we need is a sustainable and growing housing market, not a market that is prone to ups and downs. Prices are constantly changing, but prices will rise at reasonable levels each year in the long run. It’s good for everyone if it rises steadily for years, ten years, 20 years, and beyond. Thus, the market benefits most people.”

Financial Hike

Alexander said: I conclude. Rising interest rates, market bubbling, exaggeration, and changing circumstances will cause more pain in the future. That will reveal the true price of high-value loans.

During Christmas Week, it was announced that the Lomond Group had acquired DJ Alexander, funded by Lomond Group’s private equity partner LDC. DJ Alexander will continue to operate under his existing name, with founder David Alexander managing the Scottish Lomond business as Chief Executive Officer.

DJ Alexander’s 104 employees will join the Loch Lomond Group, bringing the total number of employees to approximately 250 in Scotland and 1,000 in the United Kingdom.

New Normal means fewer house sales and less lending

According to the latest report from the Association of Intermediate Mortgage Lenders, mortgage lenders servicing the housing market will settle in 2022 after unusual activity in 2021.

IMLA predicts that total real estate transactions in 2021 will reach a record of nearly $ 370 billion by 2023. Next year, a series of forecasts on the mortgage market states that the debt restructuring market will be hit. So, it will reach £ 89 billion in 2022, compared to £ 82 billion in 2021. Hence, there will be an increase. Debt reschedules market details. In general, the development of the residential real estate market has been hit by high-interest rates caused by the need to curb post-Covid inflation spikes. However, the impact could be mitigated by several factors. I have.

Mitigating Factors

First, the bond market continues to show that interest rates remain historically low for the foreseeable future. This is happening with 50-year government bond yields remaining at 1.0%, despite market expectations for short-term rate hikes. I am. A decline in long-term interest rates should ensure that long-term (more than five years) fixed-rate mortgage rates do not rise much.

Second, the housing market continues to experience near-record lows, supporting home prices and preventing total prices from falling sharply. Kate Davies, Executive Director of IMLA, provided insight. Still, the debt restructuring market is in a good position to thrive next year. So, interest rates may rise, but mortgage rates are the government’s long-term housing strategy. These rates include hundreds of promised deliveries by 2021. It remains close to the lowest ever in the year. Thousands of new homes for a new generation of homeowners have specter properties to choose from.

“Lenders will continue to develop and engage in alternatives to the Help-to-Buy program. The program will expire in 2023. It will help first-time buyers realize their dream of owning a home.”

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