r/Glasgow Tools

Title
Author	Galstar82
Comment	You make some good points but I disagree here, there may be a dip but it’s unlikely to be anywhere close to a property crash. House prices aren’t as closely linked to the economy in high demand places such as Glasgow as many people make out. In many areas it’s just a case of basic supply/demand which is why semis in Bearsden can cost 400k but same in Carntyne are 1/4-1/3 of that. The crash in 2008 was an extremely special set of circumstances where lenders hadn’t properly assessed affordability coupled with rapid and high unemployment. This led to a surge of housing supply hitting the market at the same time, which led to lower prices. Since about 2010 banks have been extremely cautious with affordability checks, there is no mass unemployment and although they seem high interest rates are still low historically. Due to this there won’t be anywhere near the amount of foreclosures as there was back then, many people are on fixed rates and the economic conditions don’t currently exist for long term interest rate rises. Simply put, in Glasgow there are enough people with the wealth/funds available to keep the market buoyant, B2L investors will also be encouraged as the interest rates will stop first time buyers so therefore the rental market will grow. The Glasgow market is also still relatively cheap considering it’s the 3rd largest city in the UK, in comparison to Edinburgh, Manchester, Birmingham & Others you still get a lot for your money.
Reddit Link	https://www.reddit.com/r/glasgow/comments/xq7e2g/glasgow_house_hunters/iq7wka8/
Created	Wed 28th Sep 2022 11:38am
Status	normal ()

You make some good points but I disagree here, there may be a dip but it’s unlikely to be anywhere close to a property crash.

House prices aren’t as closely linked to the economy in high demand places such as Glasgow as many people make out.

In many areas it’s just a case of basic supply/demand which is why semis in Bearsden can cost 400k but same in Carntyne are 1/4-1/3 of that.

The crash in 2008 was an extremely special set of circumstances where lenders hadn’t properly assessed affordability coupled with rapid and high unemployment.

This led to a surge of housing supply hitting the market at the same time, which led to lower prices.

Since about 2010 banks have been extremely cautious with affordability checks, there is no mass unemployment and although they seem high interest rates are still low historically.

Due to this there won’t be anywhere near the amount of foreclosures as there was back then, many people are on fixed rates and the economic conditions don’t currently exist for long term interest rate rises.

Simply put, in Glasgow there are enough people with the wealth/funds available to keep the market buoyant, B2L investors will also be encouraged as the interest rates will stop first time buyers so therefore the rental market will grow.

The Glasgow market is also still relatively cheap considering it’s the 3rd largest city in the UK, in comparison to Edinburgh, Manchester, Birmingham & Others you still get a lot for your money.