How far will house prices fall [volume 4]
Discussion
Apologies for turning the thread back to London again, but I found this article fairly interesting in City AM today:
http://www.cityam.com/275789/living-these-parts-lo...
Ignoring the questionable way that the numbers have been put together and the fact they have included commuting costs, isn't this just a bit of a return to the 'norm'?
Before the real London boom from 1997 onwards, weren't the better places in the commuter belt like Sevenoaks always more expensive than cheaper z3 places like Upton Park?
In fact, I seem to remember Sevenoaks or Esher being more expensive than much better parts of zone 3 London than Upton Park, and a bit closer to the prime areas.
At the top end, if a nice mansion in Esher that is £4m now was £1m 25 years ago, how much was a Knightsbridge townshouse that is now £40m? I certainly don't remember there being many £10m houses around back then.
http://www.cityam.com/275789/living-these-parts-lo...
Ignoring the questionable way that the numbers have been put together and the fact they have included commuting costs, isn't this just a bit of a return to the 'norm'?
Before the real London boom from 1997 onwards, weren't the better places in the commuter belt like Sevenoaks always more expensive than cheaper z3 places like Upton Park?
In fact, I seem to remember Sevenoaks or Esher being more expensive than much better parts of zone 3 London than Upton Park, and a bit closer to the prime areas.
At the top end, if a nice mansion in Esher that is £4m now was £1m 25 years ago, how much was a Knightsbridge townshouse that is now £40m? I certainly don't remember there being many £10m houses around back then.
kingston12 said:
Ignoring the questionable way that the numbers have been put together and the fact they have included commuting costs, isn't this just a bit of a return to the 'norm'?
Not sure if there is anything surprising in that report. I'd imagine most people live in SW London / Surrey because it's much much nicer. Or they perceive it to be. But in addition to paying a few £k for the privilege, you're spending 2-3 hours a day, slogging it out on SWT and the tube system to get to your office in Liverpool Street.kingston12 said:
Before the real London boom from 1997 onwards, weren't the better places in the commuter belt like Sevenoaks always more expensive than cheaper z3 places like Upton Park?
This is purely anecdotal, but that's how I remember it.I grew up around Surrey and that wasn't the only thing the opposite way round from recent accepted wisdom. Not only did we consider ourselves "better off" than the bits of the family who lived around Wimbledon/New Malden, but also that I remember my parents spending a fortune to move from a smallish Edwardian railway cottage to a big old bay-fronted 1930s house a few roads over. No prizes for guessing which of those houses is worth more nowadays!
fido said:
Not sure if there is anything surprising in that report.
I agree. The part that surprised me is that the author of the report/article seemed surprised that living in a sought-after part of the commuter belt was more expensive than living in a very poor part of London. They seem to suggest that this is because of London's prices stalling whilst the SE pushes ahead, but I still think that London is much more expensive compared to the commuter belt than it was pre-boom.
fido said:
I'd imagine most people live in SW London / Surrey because it's much much nicer. Or they perceive it to be. But in addition to paying a few £k for the privilege, you're spending 2-3 hours a day, slogging it out on SWT and the tube system to get to your office in Liverpool Street.
There have always been those who move out because it is the only way of getting extra space as well as those who do it to get a different/better lifestyle. In my experience, a lot of people who would have been in that latter category have actually stayed in/closer to London than their predecessors would have done.
I guess some of this has to do with gentrification in parts of London. It must have been a relief to move out of somewhere like Balham in the 1980s down to Guildford, but it is a far nicer area now than it was then.
Edited by kingston12 on Friday 17th November 10:09
Timberwolf said:
kingston12 said:
Before the real London boom from 1997 onwards, weren't the better places in the commuter belt like Sevenoaks always more expensive than cheaper z3 places like Upton Park?
This is purely anecdotal, but that's how I remember it.I grew up around Surrey and that wasn't the only thing the opposite way round from recent accepted wisdom. Not only did we consider ourselves "better off" than the bits of the family who lived around Wimbledon/New Malden, but also that I remember my parents spending a fortune to move from a smallish Edwardian railway cottage to a big old bay-fronted 1930s house a few roads over. No prizes for guessing which of those houses is worth more nowadays!
My parents always preferred more modern houses, and I definitely get the impression that the smaller 'workers' cottages so coveted by their offspring were a bit looked down upon by that generation.
fido said:
Not sure if there is anything surprising in that report. I'd imagine most people live in SW London / Surrey because it's much much nicer. Or they perceive it to be. But in addition to paying a few £k for the privilege, you're spending 2-3 hours a day, slogging it out on SWT and the tube system to get to your office in Liverpool Street.
I think many dads are quite happy to commute 2 hours a day if kids don't have to grow up in East London 
anonymous said:
[redacted]
I had the same experience selling my place at the start of the year. First time buyers all over it (2 viewings/day from the point it went on the market to the point I accepted an offer) but they'd feed back that while they loved the base house, the kitchen cabinets needed replacing, or the windows were old, or that a few rooms could do with a good skim and repaint, and move on. Not even try a cheeky, "make an offer £25k below asking and see what happens" - just move on.The agent said that most of them ended up bidding on 2-bed flats around the same price point because they wanted brand new fixtures and fittings. They were aware that a 3-bed house in a nicer bit of town had far more potential, but just couldn't get themselves over it being a bit tired inside and out. We did eventually find an FTB who had their head screwed on and was prepared to look past a bit of stipple-finish Artex, but I can see why so many of these entry level houses end up going to landlords and developers who know they're only a Howdens kitchen and a bit of plastering away from having quite a nice monthly yield.
Timberwolf said:
The agent said that most of them ended up bidding on 2-bed flats around the same price point because they wanted brand new fixtures and fittings. They were aware that a 3-bed house in a nicer bit of town had far more potential, but just couldn't get themselves over it being a bit tired inside and out. We did eventually find an FTB who had their head screwed on and was prepared to look past a bit of stipple-finish Artex, but I can see why so many of these entry level houses end up going to landlords and developers who know they're only a Howdens kitchen and a bit of plastering away from having quite a nice monthly yield.
The FTBs then whinge that they've been priced out of anything more than a shoebox flat and everyone blames the evil landlords.Timberwolf said:
I had the same experience selling my place at the start of the year. First time buyers all over it (2 viewings/day from the point it went on the market to the point I accepted an offer) but they'd feed back that while they loved the base house, the kitchen cabinets needed replacing, or the windows were old, or that a few rooms could do with a good skim and repaint, and move on. Not even try a cheeky, "make an offer £25k below asking and see what happens" - just move on.
The agent said that most of them ended up bidding on 2-bed flats around the same price point because they wanted brand new fixtures and fittings. They were aware that a 3-bed house in a nicer bit of town had far more potential, but just couldn't get themselves over it being a bit tired inside and out. We did eventually find an FTB who had their head screwed on and was prepared to look past a bit of stipple-finish Artex, but I can see why so many of these entry level houses end up going to landlords and developers who know they're only a Howdens kitchen and a bit of plastering away from having quite a nice monthly yield.
Big difference is that the speculator landlord will have the dosh to spend on a Howdens kitchen while the FTB will have to live on Tesco white and Value beans for 17 years after they complete with sod all to "decorate" the house with. The agent said that most of them ended up bidding on 2-bed flats around the same price point because they wanted brand new fixtures and fittings. They were aware that a 3-bed house in a nicer bit of town had far more potential, but just couldn't get themselves over it being a bit tired inside and out. We did eventually find an FTB who had their head screwed on and was prepared to look past a bit of stipple-finish Artex, but I can see why so many of these entry level houses end up going to landlords and developers who know they're only a Howdens kitchen and a bit of plastering away from having quite a nice monthly yield.
Timberwolf said:
anonymous said:
[redacted]
I had the same experience selling my place at the start of the year. First time buyers all over it (2 viewings/day from the point it went on the market to the point I accepted an offer) but they'd feed back that while they loved the base house, the kitchen cabinets needed replacing, or the windows were old, or that a few rooms could do with a good skim and repaint, and move on. Not even try a cheeky, "make an offer £25k below asking and see what happens" - just move on.The agent said that most of them ended up bidding on 2-bed flats around the same price point because they wanted brand new fixtures and fittings. They were aware that a 3-bed house in a nicer bit of town had far more potential, but just couldn't get themselves over it being a bit tired inside and out. We did eventually find an FTB who had their head screwed on and was prepared to look past a bit of stipple-finish Artex, but I can see why so many of these entry level houses end up going to landlords and developers who know they're only a Howdens kitchen and a bit of plastering away from having quite a nice monthly yield.
rover 623gsi said:
don't estate agents have any responsibility/desire/incentive to help would-be buyers understand stuf like this? Or do they just want to continue earning money for old roap. I'd also add that estate agents could do with telling some sellers to tidy the place up before putting it on the market.
There used to be a TV series that tarted up stuck-on-market houses and the thing that irritated me the most was how useless the estate agents were.Timberwolf said:
I had the same experience selling my place at the start of the year. First time buyers all over it (2 viewings/day from the point it went on the market to the point I accepted an offer) but they'd feed back that while they loved the base house, the kitchen cabinets needed replacing, or the windows were old, or that a few rooms could do with a good skim and repaint, and move on. Not even try a cheeky, "make an offer £25k below asking and see what happens" - just move on.
The agent said that most of them ended up bidding on 2-bed flats around the same price point because they wanted brand new fixtures and fittings. They were aware that a 3-bed house in a nicer bit of town had far more potential, but just couldn't get themselves over it being a bit tired inside and out. We did eventually find an FTB who had their head screwed on and was prepared to look past a bit of stipple-finish Artex, but I can see why so many of these entry level houses end up going to landlords and developers who know they're only a Howdens kitchen and a bit of plastering away from having quite a nice monthly yield.
Why not do the work pre-sale? The agent said that most of them ended up bidding on 2-bed flats around the same price point because they wanted brand new fixtures and fittings. They were aware that a 3-bed house in a nicer bit of town had far more potential, but just couldn't get themselves over it being a bit tired inside and out. We did eventually find an FTB who had their head screwed on and was prepared to look past a bit of stipple-finish Artex, but I can see why so many of these entry level houses end up going to landlords and developers who know they're only a Howdens kitchen and a bit of plastering away from having quite a nice monthly yield.
As a surveyor, from what I've seen the houses that are in strongest demand are either perfect or wrecks. By the time the people who have fought over the wrecks and gone to best & final offers, the bids are in the same ball park as one that is just a bit tatty. There seems to be this idea of doing a Grand Design and having it exactly how you want it, which puts a premium on them.
It's a bit like the classic car market, the 'barn finds' go for silly money and end up costing more than a fully restored example, whereas the shabby ones that you can do up as you go along fetch a lot less.
We have just benefited from this, having bought a 15 year old house that I don't think has had a penny spent on it, so where ones that were in tip top condition flew out of the door, ours just stagnated. We got it at a price that was at least 10% (£35K) less than a good one, yet we've spent only 1/3 of that over the last 4 months bringing it up to the same standard as a top one. Just need to do the garden in the spring and we are there.
It's a bit like the classic car market, the 'barn finds' go for silly money and end up costing more than a fully restored example, whereas the shabby ones that you can do up as you go along fetch a lot less.
We have just benefited from this, having bought a 15 year old house that I don't think has had a penny spent on it, so where ones that were in tip top condition flew out of the door, ours just stagnated. We got it at a price that was at least 10% (£35K) less than a good one, yet we've spent only 1/3 of that over the last 4 months bringing it up to the same standard as a top one. Just need to do the garden in the spring and we are there.
anonymous said:
[redacted]
You may want to check your figures for the real world. Some mortgages are less than rent, but with rent you don't have to redecorate or spend a penny on the house. Young people are skint. (not all of them, obviously).
IF they have enough for the deposit (through bank of boomer mum and dad) and fees, they won't have the money for the upgrades/kitchen/decorations/furniture and so on. It's obvious. Otherwise they would buy the house and fix what they want fixed (I did that, but I'm not representative of the bulk of the FTB market).
It's not a matter of "they are lazy/unimaginative/not entrepreneurial/workshy/imbeciles. They are not idiots, they are just too poor for the current price levels.
stuckmojo said:
anonymous said:
[redacted]
You may want to check your figures for the real world. Some mortgages are less than rent, but with rent you don't have to redecorate or spend a penny on the house. Young people are skint. (not all of them, obviously).
IF they have enough for the deposit (through bank of boomer mum and dad) and fees, they won't have the money for the upgrades/kitchen/decorations/furniture and so on. It's obvious. Otherwise they would buy the house and fix what they want fixed (I did that, but I'm not representative of the bulk of the FTB market).
It's not a matter of "they are lazy/unimaginative/not entrepreneurial/workshy/imbeciles. They are not idiots, they are just too poor for the current price levels.
Possibly veering O/T, but there is definitely a number of people who are pretty hopeless at DIY.
I'm 43 and compared to my dad and my father-in-law I consider myself average at DIY. My skills are OK but I have quite a good idea of what can and can't be done, and how things can be reconfigured. Most of my friends (all of a same age) would not know where to start and have been in awe at what we've managed on our houses over the years, which I actually find a bit embarrassing rather than flattering.
I'm 43 and compared to my dad and my father-in-law I consider myself average at DIY. My skills are OK but I have quite a good idea of what can and can't be done, and how things can be reconfigured. Most of my friends (all of a same age) would not know where to start and have been in awe at what we've managed on our houses over the years, which I actually find a bit embarrassing rather than flattering.
soxboy said:
Justayellowbadge said:
Why not do the work pre-sale?
A few reasons I would say. Laziness, lack of time, lack of skills and lack of reliable contacts. Plus the costs they get quotes for may be more than the drop in value.soxboy said:
Possibly veering O/T, but there is definitely a number of people who are pretty hopeless at DIY.
I'm 43 and compared to my dad and my father-in-law I consider myself average at DIY. My skills are OK but I have quite a good idea of what can and can't be done, and how things can be reconfigured. Most of my friends (all of a same age) would not know where to start and have been in awe at what we've managed on our houses over the years, which I actually find a bit embarrassing rather than flattering.
One of my son-in-laws won't even attempt putting Ikea stuff together. The other one will do it, but will break something. I'm still not sure which is best.I'm 43 and compared to my dad and my father-in-law I consider myself average at DIY. My skills are OK but I have quite a good idea of what can and can't be done, and how things can be reconfigured. Most of my friends (all of a same age) would not know where to start and have been in awe at what we've managed on our houses over the years, which I actually find a bit embarrassing rather than flattering.
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