How far will house prices fall [volume 4]
Discussion
z4chris99 said:
and at the lower end cheap money, H2B etc propping up that market
And often indirectly where feckless couples who would get turned down for the mortgage are now attending viewings and bidding without a AIP in place, thereby pushing up the price for those able to complete.I haven't seen a mention of foreign money into zone 1 in the last couple of pages, if that was addressed it would stop wealthier Londoners having to look further out with their higher budgets calming things down a bit.
Long term Crossrail2, which had been shelved, needs to be added to with Crossrail 3 and 4 and more underground. Once Londoners have kids they want to move to a house in a decent area within a small commute hence why family homes in a catchment area are hard to buy- only new transport links can address this.
Edited by Yazar on Monday 19th May 11:22
Yazar said:
I haven't seen a mention of foreign money into zone 1 in the last couple of pages, if that was addressed it would stop wealthier Londoners having to look further out with their higher budgets calming things down a bit.
This will address itself soon enough, as soon as that foreign money can make more/easy money somewhere else in the world it will disappear from London. Yazar said:
I haven't seen a mention of foreign money into zone 1 in the last couple of pages, if that was addressed it would stop wealthier Londoners having to look further out with their higher budgets calming things down a bit.
The overseas money in the prime old / new build markets is very hard to address. There are two groups at play here also. Edited by Yazar on Monday 19th May 11:22
1. Cash buyers - raising your CT, stamp etc doesnt really matter to them. They are buying as a money store and using london property as a very lax money laundering bank.
2. Overseas 'investors' - these are your chaps buying up units at most new build schemes in london, these units should be for UK buyers, but the prices are so high now UK buyers wouldnt bother. most of these investors cant/wont complete on the units and are just buying to flip their contracts. If they do complete they will be using debt and the combination of high service charges, low rental yields and possible increases in CT and Stamp will really hurt these guys. This is the market i can see leading the crash.
kev1974 said:
This will address itself soon enough, as soon as that foreign money can make more/easy money somewhere else in the world it will disappear from London.
A lot of that isn't anything to do with making a return, it's just safely parking cash in something. Imagine a more likely scenario is the off-plan Asian crowd (buying to leave empty - E14, Battersea power station etc.) needing liquid cash quick and chopping asking prices. NomduJour said:
A lot of that isn't anything to do with making a return, it's just safely parking cash in something. Imagine a more likely scenario is the off-plan Asian crowd (buying to leave empty - E14, Battersea power station etc.) needing liquid cash quick and chopping asking prices.
They arnt buying to leave empty, they are buying to flip off plan.. look at the amount of resales at pretty much every new build scheme that hasnt completed. Even the s
t ones like Cityscape. The occasional one wants to rent theirs out, but the net returns are below 1% after you have paid fees, SC, ground rent etc.
The catalyst will be in the next 18-36 months when 15000 asians have to complete on flats they dont have any money for, so get debted up and dump 15000 homes onto the rental market expecting to pay their mortgage.
I handle sales at one of these new build towers, so am pretty close to the ground.
Yazar said:
And often indirectly where feckless couples who would get turned down for the mortgage are now attending viewings and bidding without a AIP in place, thereby pushing up the price for those able to complete.z4chris99 said:
They arnt buying to leave empty, they are buying to flip off plan
Plenty of completed and never-occupied flats in town: http://www.standard.co.uk/news/london/scandal-of-t...NomduJour said:
z4chris99 said:
They arnt buying to leave empty, they are buying to flip off plan
Plenty of completed and never-occupied flats in town: http://www.standard.co.uk/news/london/scandal-of-t..."The 14-storey curved Bezier development, near Old Street roundabout, was completed in 2010 by Tudorvale Properties. It has 127 apartments, of which 75 are listed as having occupants registered for council tax."
so there are 52 'empty' -
of those 15 are for sale as resales
A hand full are for sale still from the developer.
So maybe 30 are left empty, and of these they are probally just used the odd week a year and not bothering with tax etc.
z4chris99 said:
The overseas money in the prime old / new build markets is very hard to address. There are two groups at play here also.
1. Cash buyers - raising your CT, stamp etc doesnt really matter to them. They are buying as a money store and using london property as a very lax money laundering bank.
2. Overseas 'investors' - these are your chaps buying up units at most new build schemes in london, these units should be for UK buyers, but the prices are so high now UK buyers wouldnt bother. most of these investors cant/wont complete on the units and are just buying to flip their contracts. If they do complete they will be using debt and the combination of high service charges, low rental yields and possible increases in CT and Stamp will really hurt these guys. This is the market i can see leading the crash.
One of largest groups of london buyers are Singaporean. Singapore itself makes it very hard for foreigners to buy there...1. Cash buyers - raising your CT, stamp etc doesnt really matter to them. They are buying as a money store and using london property as a very lax money laundering bank.
2. Overseas 'investors' - these are your chaps buying up units at most new build schemes in london, these units should be for UK buyers, but the prices are so high now UK buyers wouldnt bother. most of these investors cant/wont complete on the units and are just buying to flip their contracts. If they do complete they will be using debt and the combination of high service charges, low rental yields and possible increases in CT and Stamp will really hurt these guys. This is the market i can see leading the crash.
brickwall said:
Yazar said:
And often indirectly where feckless couples who would get turned down for the mortgage are now attending viewings and bidding without a AIP in place, thereby pushing up the price for those able to complete.Just the fact that 'open day' has more people squeezing around itself pushes them up as intensifies competition- 36 other parties viewed my new (old) house within the open day.
It's almost as if the hype around the removal of squatting as a civil matter (which in reality affected a tiny minority) was done to appease overseas buyers who can now rely on the UK police to make sure empty homes are not squatted.
Anyway, there are some very interesting statistics in this article (below) in which they show how a run down estate is being regenerated then sold off plan to overseas investors. No wonder they can keep house prices spiralling if they can continually attract overseas investors who are parking their funds in London.
So it's good to know that most of the UK workforce will one day live in a house owned by a foreign owner and all that rental income wont be going to the UK but will instead be re-repatriated back to the owner.
Nice... UK houses for foreign owners, leaching funds back to Russia, China, Singapore etc.
http://www.theguardian.com/society/2014/may/18/-sp...
[quote]
When marketing began, Berkeley concentrated its efforts on east Asia and ended up selling around 55% of the first phase of buildings to overseas investors. That’s unusually high for this area. Going through Land Registry records, estate agents Knight Frank calculated that overseas residents bought 49% of all newly built property in the plushest parts of central London in the year to June 2013; that proportion dropped to 20% across inner London and to less than 7% in outer London. This estate sits slap-bang on the divide between inner and outer London, yet its towers have lured a greater proportion of foreign buyers than those in Kensington and Westminster.
How did Berkeley manage that? Expert marketing. The firm has sales offices in Singapore, Hong Kong and, as of last autumn, Beijing. To flog Woodberry Park, it hired out ballrooms and conference suites in hotels thousands of miles away and talked to small Asian families about the profit to be made from letting apartments in London. According to the British Property Federation, 61% of all new homes sold in the capital last year were bought not to live in but solely as an investment. The vast majority of them would have been rented out; 5% were flipped back onto the market.
...
Later, Dhimi recounts how a client bought an apartment here off-plan from one of those hotel suites a world away. When it was finished, he drove her directly from Heathrow to have a look. “As we got closer, the surroundings got rougher and she went quiet. And when we arrived she said: ‘Dhimi, I can’t stay here: put me in a hotel.’ The next morning she wanted to sell up. Immediately.”
[/quote]
Anyway, there are some very interesting statistics in this article (below) in which they show how a run down estate is being regenerated then sold off plan to overseas investors. No wonder they can keep house prices spiralling if they can continually attract overseas investors who are parking their funds in London.
So it's good to know that most of the UK workforce will one day live in a house owned by a foreign owner and all that rental income wont be going to the UK but will instead be re-repatriated back to the owner.
Nice... UK houses for foreign owners, leaching funds back to Russia, China, Singapore etc.
http://www.theguardian.com/society/2014/may/18/-sp...
[quote]
When marketing began, Berkeley concentrated its efforts on east Asia and ended up selling around 55% of the first phase of buildings to overseas investors. That’s unusually high for this area. Going through Land Registry records, estate agents Knight Frank calculated that overseas residents bought 49% of all newly built property in the plushest parts of central London in the year to June 2013; that proportion dropped to 20% across inner London and to less than 7% in outer London. This estate sits slap-bang on the divide between inner and outer London, yet its towers have lured a greater proportion of foreign buyers than those in Kensington and Westminster.
How did Berkeley manage that? Expert marketing. The firm has sales offices in Singapore, Hong Kong and, as of last autumn, Beijing. To flog Woodberry Park, it hired out ballrooms and conference suites in hotels thousands of miles away and talked to small Asian families about the profit to be made from letting apartments in London. According to the British Property Federation, 61% of all new homes sold in the capital last year were bought not to live in but solely as an investment. The vast majority of them would have been rented out; 5% were flipped back onto the market.
...
Later, Dhimi recounts how a client bought an apartment here off-plan from one of those hotel suites a world away. When it was finished, he drove her directly from Heathrow to have a look. “As we got closer, the surroundings got rougher and she went quiet. And when we arrived she said: ‘Dhimi, I can’t stay here: put me in a hotel.’ The next morning she wanted to sell up. Immediately.”
[/quote]
I've done a few of those hotel gigs, one in Singapore, one in HK.
happily what we were selling is nice, I'd happily live there myself. but there was some real st in the same hotel...
get a zone 3 site, sub grand a foot, brand it well and call it "the Knightsbridge building' - will fly off the shelves in Asia.
happily what we were selling is nice, I'd happily live there myself. but there was some real s
t in the same hotel... get a zone 3 site, sub grand a foot, brand it well and call it "the Knightsbridge building' - will fly off the shelves in Asia.
menousername said:
Its clearly a sellers market yet buyers are ploughing in like its a buyers market. I have no idea why anyone would do that, or outbid the asking price by 10, 15, 20%, so soon after the whole thing almost collapsed (not just the housing market but life as we know it)
Surely the definition of a sellers market is when there are more buyers than sellers and the buyers are out-bidding each other to buy. If there weren't lots of people desperate to buy (and pay over the odds) then it wouldn't be a sellers market. You're too late for the buyers market. This was several years ago when people were desperate to get rid of housing they thought might drop even further in value.I think most people think we are past the worst of the collapse and prices are only going up. This is why lots of people are desperate to buy and hence it's a sellers market. We took a similar gamble in 2012. We decided that house prices were at their minimum so it was the best time to up-size our house, i.e. the most extra space for the least extra outlay.
I don't think there's much stopping the asian investors. They have fooking billions to spend. Some contacts in Shanghai have suggesting Chinese investors are now buying heavily in Manchester as well, as even London is getting too hot.
That money has to go somewhere, the asian market is saturated with cash, it just can't take any more. I can't think of a single secure asian city with resonable prices. Jesus, my 2 bedroom apartment in a crappy part of South Korea is $2800/month. A new apartment block down the road was oversubscribed 75x.
That money has to go somewhere, the asian market is saturated with cash, it just can't take any more. I can't think of a single secure asian city with resonable prices. Jesus, my 2 bedroom apartment in a crappy part of South Korea is $2800/month. A new apartment block down the road was oversubscribed 75x.
alock said:
Surely the definition of a sellers market is when there are more buyers than sellers and the buyers are out-bidding each other to buy. If there weren't lots of people desperate to buy (and pay over the odds) then it wouldn't be a sellers market. You're too late for the buyers market. This was several years ago when people were desperate to get rid of housing they thought might drop even further in value.
I think most people think we are past the worst of the collapse and prices are only going up. This is why lots of people are desperate to buy and hence it's a sellers market. We took a similar gamble in 2012. We decided that house prices were at their minimum so it was the best time to up-size our house, i.e. the most extra space for the least extra outlay.
I think the problem is people KNOW houses will never, ever come down, so paying 10, 15, 20% over doesn't matter! it's still going to go up.I think most people think we are past the worst of the collapse and prices are only going up. This is why lots of people are desperate to buy and hence it's a sellers market. We took a similar gamble in 2012. We decided that house prices were at their minimum so it was the best time to up-size our house, i.e. the most extra space for the least extra outlay.
It's the risk of the bail out - everyone now thinks there is no downside - houses are a risk free investment.. At least, I believe that's the sentiment.
Pork said:
alock said:
Surely the definition of a sellers market is when there are more buyers than sellers and the buyers are out-bidding each other to buy. If there weren't lots of people desperate to buy (and pay over the odds) then it wouldn't be a sellers market. You're too late for the buyers market. This was several years ago when people were desperate to get rid of housing they thought might drop even further in value.
I think most people think we are past the worst of the collapse and prices are only going up. This is why lots of people are desperate to buy and hence it's a sellers market. We took a similar gamble in 2012. We decided that house prices were at their minimum so it was the best time to up-size our house, i.e. the most extra space for the least extra outlay.
I think the problem is people KNOW houses will never, ever come down, so paying 10, 15, 20% over doesn't matter! it's still going to go up.I think most people think we are past the worst of the collapse and prices are only going up. This is why lots of people are desperate to buy and hence it's a sellers market. We took a similar gamble in 2012. We decided that house prices were at their minimum so it was the best time to up-size our house, i.e. the most extra space for the least extra outlay.
It's the risk of the bail out - everyone now thinks there is no downside - houses are a risk free investment.. At least, I believe that's the sentiment.
I would say that is certainly the belief. Not sure how realistic it is though. In the South East and London however, it may possibly be; at the moment I cant really see a big traditional crash happening; there are just too many people who want houses and currently dont have them. If prices fall, everyone will want to pile straight in which will push prices instantly back up again. Surely that is just how supply and demand works? Up north prices fell so much as demand was not outstripping supply and people were not gravitating to the area like they do to London. I have at least 5 friends ready and waiting to pounce with good deposits if (when?) a crash comes down here; I bet there are hundreds of thousands like them.
vescaegg said:
Pork said:
alock said:
Surely the definition of a sellers market is when there are more buyers than sellers and the buyers are out-bidding each other to buy. If there weren't lots of people desperate to buy (and pay over the odds) then it wouldn't be a sellers market. You're too late for the buyers market. This was several years ago when people were desperate to get rid of housing they thought might drop even further in value.
I think most people think we are past the worst of the collapse and prices are only going up. This is why lots of people are desperate to buy and hence it's a sellers market. We took a similar gamble in 2012. We decided that house prices were at their minimum so it was the best time to up-size our house, i.e. the most extra space for the least extra outlay.
I think the problem is people KNOW houses will never, ever come down, so paying 10, 15, 20% over doesn't matter! it's still going to go up.I think most people think we are past the worst of the collapse and prices are only going up. This is why lots of people are desperate to buy and hence it's a sellers market. We took a similar gamble in 2012. We decided that house prices were at their minimum so it was the best time to up-size our house, i.e. the most extra space for the least extra outlay.
It's the risk of the bail out - everyone now thinks there is no downside - houses are a risk free investment.. At least, I believe that's the sentiment.
I would say that is certainly the belief. Not sure how realistic it is though. In the South East and London however, it may possibly be; at the moment I cant really see a big traditional crash happening; there are just too many people who want houses and currently dont have them. If prices fall, everyone will want to pile straight in which will push prices instantly back up again. Surely that is just how supply and demand works? Up north prices fell so much as demand was not outstripping supply and people were not gravitating to the area like they do to London. I have at least 5 friends ready and waiting to pounce with good deposits if (when?) a crash comes down here; I bet there are hundreds of thousands like them.
turbobloke said:
vescaegg said:
Pork said:
alock said:
Surely the definition of a sellers market is when there are more buyers than sellers and the buyers are out-bidding each other to buy. If there weren't lots of people desperate to buy (and pay over the odds) then it wouldn't be a sellers market. You're too late for the buyers market. This was several years ago when people were desperate to get rid of housing they thought might drop even further in value.
I think most people think we are past the worst of the collapse and prices are only going up. This is why lots of people are desperate to buy and hence it's a sellers market. We took a similar gamble in 2012. We decided that house prices were at their minimum so it was the best time to up-size our house, i.e. the most extra space for the least extra outlay.
I think the problem is people KNOW houses will never, ever come down, so paying 10, 15, 20% over doesn't matter! it's still going to go up.I think most people think we are past the worst of the collapse and prices are only going up. This is why lots of people are desperate to buy and hence it's a sellers market. We took a similar gamble in 2012. We decided that house prices were at their minimum so it was the best time to up-size our house, i.e. the most extra space for the least extra outlay.
It's the risk of the bail out - everyone now thinks there is no downside - houses are a risk free investment.. At least, I believe that's the sentiment.
I would say that is certainly the belief. Not sure how realistic it is though. In the South East and London however, it may possibly be; at the moment I cant really see a big traditional crash happening; there are just too many people who want houses and currently dont have them. If prices fall, everyone will want to pile straight in which will push prices instantly back up again. Surely that is just how supply and demand works? Up north prices fell so much as demand was not outstripping supply and people were not gravitating to the area like they do to London. I have at least 5 friends ready and waiting to pounce with good deposits if (when?) a crash comes down here; I bet there are hundreds of thousands like them.
And a few of them dont necessarily share my beliefs though, do see a crash coming and are waiting to get something once it happens.
Who will be right is anyones guess.
alock said:
Surely the definition of a sellers market is when there are more buyers than sellers and the buyers are out-bidding each other to buy. If there weren't lots of people desperate to buy (and pay over the odds) then it wouldn't be a sellers market. You're too late for the buyers market. This was several years ago when people were desperate to get rid of housing they thought might drop even further in value.
I think most people think we are past the worst of the collapse and prices are only going up. This is why lots of people are desperate to buy and hence it's a sellers market. We took a similar gamble in 2012. We decided that house prices were at their minimum so it was the best time to up-size our house, i.e. the most extra space for the least extra outlay.
thats what I said.. its a sellers marketI think most people think we are past the worst of the collapse and prices are only going up. This is why lots of people are desperate to buy and hence it's a sellers market. We took a similar gamble in 2012. We decided that house prices were at their minimum so it was the best time to up-size our house, i.e. the most extra space for the least extra outlay.
but I do not understand why it is propergated by people acting like its a buyers market. Prices go up, houses are going for 10/20% more than asking price, so more people pile in even deeper.
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