How far will house prices fall [volume 4]
Discussion
TopOnePercent said:
NomduJour said:
The international rich aren't buying up prime London just because interest rates are low though. Rate rise = price fall.
Unlikely as rates will rise very very slowly allowing a gradual deleveraging while inflation erodes the mortgage.London might come off a bit, but any proper crash won't be caused by rates alone.
sugerbear said:
That is the happy path. In all cases beware of the Black Swan, because that is the thing that will kill the market and no one will have predicted it or seen is coming.
With the last black swan causing the 2008 crash, banks were told not to repossess and rates were lowered. So the reckless were rewarded.This has now caused a behaviour where people will get into debt on mass and rely on bailouts in extremes.
Quick Q.
We're due for a re-mortgage, been offered a (what I consider, based on the offers we've had) good rate of 2.59% for the remaining £112k on the house. Only snag is value has come round from the new mortage company and wipe £20knof the expected value of our property.
We're appealing the decision as there is evidence (in other houses for sale and closed sales) that this is nonsense, i'm just curious at what would prompt a low valuation on a relatively cheap house (purchased brand new 2 years ago for £160k).
We're due for a re-mortgage, been offered a (what I consider, based on the offers we've had) good rate of 2.59% for the remaining £112k on the house. Only snag is value has come round from the new mortage company and wipe £20knof the expected value of our property.
We're appealing the decision as there is evidence (in other houses for sale and closed sales) that this is nonsense, i'm just curious at what would prompt a low valuation on a relatively cheap house (purchased brand new 2 years ago for £160k).
The showhome 'lifestyle'.NPI said:
Digga said:
did wonder that, but it wasn't explicit in mine or the original post.
I took it from the use of the word "snag". That they're appealing the valuation indicates that it is indeed a snag.anonymous said:
[redacted]
Spot on. New build premium plus if they reposess and 3 in the street are on at £155ono then they'd have to sell yours for much less to get a quick sale.Plus, if you want new carpets thats £1500 plus decorated whereas it was brand new when you bought it.
Plus new builds benefit from help to buy, part x, developer gimmicks etc.
anonymous said:
[redacted]
Thanks for that. I was expecting somewhere between £145-£150k as this seems to be the going rate. Theres only 12 of our style of house on the development, 2 have sold recently and one is currently up for sale. We've chucked a bit of cash at it improving it (such as garden and fixtures/fittings) as well. Its not quite a crisis but as this is our first house I wasn't sure if this was just part of the remortgage negotiations/tactics to increase your LTV, almost making the 2.59% a swith and bait rate. The fact they are still selling new ones at £165k is a tad annoying.
anonymous said:
[redacted]
I don't think so, both worked since 16 and saved cash plus from being aged zero they all saved bits family gave them at birthdays, christmas etc, suppose that is family support. I think they put down about £40k, does that sound right? They work for good firms, think they were on a bit over £40 at the start but could be wrong.
Either way, they now work 3 days per week and have no mortgage!
KarlMac said:
2 have sold recently
what did they actually sell for? and how do they compare to your home (assume they are of the same age)? the surveyor is going to look at cold hard evidence (for his lender) and not whether you've put in some new decking from B&Q.Edited by fido on Wednesday 16th April 16:49
fido said:
what did they actually sell for? and how do they compare to your home?
It doesn't matter. New houses seem to sell for bonkers prices. A new estate tacked onto our village is selling off-plan like hot cakes while established houses in the main part of the village are sitting there at £75K less (£250K vs £325K to put some scale on it).NPI said:
fido said:
what did they actually sell for? and how do they compare to your home?
It doesn't matter. New houses seem to sell for bonkers prices. A new estate tacked onto our village is selling off-plan like hot cakes while established houses in the main part of the village are sitting there at £75K less (£250K vs £325K to put some scale on it).http://www.redrow.co.uk/houses/leicester-road-coun...
and here are two other 4 bedders in the village for the wrong price:
http://www.rightmove.co.uk/property-for-sale/prope...
http://www.rightmove.co.uk/property-for-sale/prope... (garden similar size to the new one above)
Same for 5 beds, the new one initially looks overpriced:
http://www.redrow.co.uk/houses/leicester-road-coun...
But then you see this:
http://www.rightmove.co.uk/property-for-sale/prope...
Gardens on the bigger new houses are not too small either, and many have double garages/plenty of parking.
Don't forget that if interest rates rise it can affect demand even when there are alot of all cash or low geared buyers. This is for multiple reasons: attractiveness of cash deposits vs property investment; cost of loan servicing for other debts including business borrowing; potential increase in GBP rate limiting buying power of non GBP reserves; depression of consumer demand affecting some dividends/returns. And so on.
I'm surprised there's no mention in this thread of the new Mortgage Market Review regs coming in at the end of the month. Will no doubt slow mortgage approvals a bit but whether it will affect the market is another story.
Whatever people say a lot of the market still depends on mortgages so a strangle on availability, whether a short term blip or long term change, will have some affect I'm sure.
Some interesting stories and info in this thread http://www.pistonheads.com/gassing/topic.asp?h=0&a...
Whatever people say a lot of the market still depends on mortgages so a strangle on availability, whether a short term blip or long term change, will have some affect I'm sure.
Some interesting stories and info in this thread http://www.pistonheads.com/gassing/topic.asp?h=0&a...
anonymous said:
[redacted]
Perhaps so!Is having £20k each at 22 that difficult though? Squirrel 3k ish pa from 16-22? Yes I know staying rent free with parents and having dinner made by parents is being helped out but I don't think they got a massive deposit each. I could be wrong though.
jonah35 said:
Is having £20k each at 22 that difficult though? Squirrel 3k ish pa from 16-22? Yes I know staying rent free with parents and having dinner made by parents is being helped out but I don't think they got a massive deposit each. I could be wrong though.
It's not impossible but incredibly unlikely, given that most graduates leave university with debt. For two graduates to be left with £20k EACH that's v.unlikely^2. I was frugal at university with a full grant for 4 years but to save 3k a year would have been soul destroying. Didn't managed to save up that much until I was 24, by which time the Grandparents left me a deposit anyway :| Me thinks BoMaD gifted them a large chunk of that deposit - though it's admittedly less exciting to brag about.Edited by fido on Thursday 17th April 11:06
Gassing Station | News, Politics & Economics | Top of Page | What's New | My Stuff