How far will house prices fall [volume 5]
Discussion
ooid said:
Bullet-Proof_Biscuit said:
Only because cash buyers were after the place like piranhas! It's well located for distance between the uni, town centre & the beach. I did cautiously negotiate to reduce 25% of the retention though.
I just recently got a job offer in Bournemouth, had to turn it down after seeing the property prices. It was not too different from "affordable" parts of London! I used to work there for a while back in 2009, prices were not this high, except mad places like Sandbanks.This is an 1895 2-up 2-down semi (but looks like a normal Victorian terrace) with 20m of garden and side access, SSTC for £247,600. The (not complete ruins like mine) houses on the road are £270-£370ish, but sub £200k is achievable for a semi/terrace if you don't mind post-1948 style.
There's some lovely period stock around here but it's B2L city if they're anywhere near the uni which is a shame as they're all ripe for reno.
500k+ gets you big, detached & period, but the commute up to town is savage
https://www.rightmove.co.uk/properties/93118268#/
And on the road adjacent to me
https://www.rightmove.co.uk/properties/94604648#/
Note proximity to the sea
Edited by Bullet-Proof_Biscuit on Tuesday 15th December 04:33
Bullet-Proof_Biscuit said:
500k+ gets you big, detached & period, but the commute up to town is savage
https://www.rightmove.co.uk/properties/93118268#/
And on the road adjacent to me
https://www.rightmove.co.uk/properties/94604648#/
They would both cost *many* £millions even in a stabby area of London. https://www.rightmove.co.uk/properties/93118268#/
And on the road adjacent to me
https://www.rightmove.co.uk/properties/94604648#/
dmahon said:
Bullet-Proof_Biscuit said:
500k+ gets you big, detached & period, but the commute up to town is savage
https://www.rightmove.co.uk/properties/93118268#/
And on the road adjacent to me
https://www.rightmove.co.uk/properties/94604648#/
They would both cost *many* £millions even in a stabby area of London.https://www.rightmove.co.uk/properties/93118268#/
And on the road adjacent to me
https://www.rightmove.co.uk/properties/94604648#/
It's the artificial demand driven by scarcity. That's mainly driven by planning.
And the fact that any normalish new build is pretty much trash. So the demand side isn't being resolved with quality builds (at least not near me)
Even the £1mill stuff in Harrogate that is new build is a bit grotty imo. OK very nice in absolute terms, but for a £1mill property you can get FAAaarrrr nice stuff that's not a new build.
MX-6 said:
Mr Whippy said:
The current approach of just borrowing money to fill out GDP growth, and waiting for some magical change to happen that solves all this is just dreaming.
I'm not sure what government think will happen at this point.
Given that sterling is a fiat currency the government can pretty much create as much new money as it wants to stimulate the economy and boost growth, eventually it will recirculate. As long as there is more money to buy things, and people want to buy more things, and there are cool shiny things for people to buy, then there will be growth.I'm not sure what government think will happen at this point.
There is always the spectre of this causing high price inflation, but that seems quite highly unlikely any time soon as there is excess capacity in the economy due to recessary effects, inflation is very low in the scheme of things. In future the government can use taxation to mop up excess money in the system if need be.
And the further prices rise the more likely they'll crash... if young people are priced completely out, even with a mum and dad help deposit, 50yr mortgage, at super low rates, with help to buy and every other thing thrown at it... then the market is buggered.
And as soon as prices stop going up any more, and life expectancy isn't getting longer for longer mortgages, then everyone will s
t a brick about lending into them any more.Panic and crash.
The more we're all so apathetic towards the social and economic cost of brutally expensive houses, the more our society will suffer because of it.
After all, what is a house? A collection of organised timber, stone/brick and slates, with a load of wires and pipes strewn inside it. And a patch of borrowed land to park it all on (look around, in 100 years chances are five or six more people will have 'owned' that land, and none of them will still be alive, it's borrowed with a "deposit" essentially)
Should they cost so much? I look around where I live and see hundreds of thousands of empty acres of land. We're not short of it. Or infrastructure to support it in appropriate areas.
The scarcity drives the value, and the scarcity is artificial. And it's artificial scarcity is destroying our society for our own children whom we supposedly love dearly.
This is an interesting watch
"In Will The Housing Market Crash in 2021, I examine both the US and UK housing markets to see if the current house price bubble is sustainable or if 2021 will be the year we see a house price crash."
https://www.youtube.com/watch?v=8pPPUTtut8s
"In Will The Housing Market Crash in 2021, I examine both the US and UK housing markets to see if the current house price bubble is sustainable or if 2021 will be the year we see a house price crash."
https://www.youtube.com/watch?v=8pPPUTtut8s
Mr Whippy said:
MX-6 said:
Mr Whippy said:
The current approach of just borrowing money to fill out GDP growth, and waiting for some magical change to happen that solves all this is just dreaming.
I'm not sure what government think will happen at this point.
Given that sterling is a fiat currency the government can pretty much create as much new money as it wants to stimulate the economy and boost growth, eventually it will recirculate. As long as there is more money to buy things, and people want to buy more things, and there are cool shiny things for people to buy, then there will be growth.I'm not sure what government think will happen at this point.
There is always the spectre of this causing high price inflation, but that seems quite highly unlikely any time soon as there is excess capacity in the economy due to recessary effects, inflation is very low in the scheme of things. In future the government can use taxation to mop up excess money in the system if need be.
And the further prices rise the more likely they'll crash... if young people are priced completely out, even with a mum and dad help deposit, 50yr mortgage, at super low rates, with help to buy and every other thing thrown at it... then the market is buggered.
And as soon as prices stop going up any more, and life expectancy isn't getting longer for longer mortgages, then everyone will s
t a brick about lending into them any more.Panic and crash.
The more we're all so apathetic towards the social and economic cost of brutally expensive houses, the more our society will suffer because of it.
After all, what is a house? A collection of organised timber, stone/brick and slates, with a load of wires and pipes strewn inside it. And a patch of borrowed land to park it all on (look around, in 100 years chances are five or six more people will have 'owned' that land, and none of them will still be alive, it's borrowed with a "deposit" essentially)
Should they cost so much? I look around where I live and see hundreds of thousands of empty acres of land. We're not short of it. Or infrastructure to support it in appropriate areas.
The scarcity drives the value, and the scarcity is artificial. And it's artificial scarcity is destroying our society for our own children whom we supposedly love dearly.
In theory there shouldn't be scarcity of homes I agree, but with property there does seem to be a relatively restricted supply of desireable homes in desireable areas that people really want to live in. Yes there can be new houses built on out-of-town sites, but there is a finite and quite restricted supply of premium period properties that are close to the town center and the train station but still in a reasonably quiet position. There seem to be more people than ever with the necessary means to drive up the prices of these kinds of houses. Then you seem to get the effect of the increasing price of the more desireable houses rippling out and dragging up the prices across the rest of the market.
As I've said previously though, there is affordability for people, even those on low incomes, to buy property providing they aren't too picky and willing to compromise on certain things to get started. I do find that everyone seems to think they are middle class now and deserve this or that, I know a number of younger people who are graduates those expectations of what sort of house they think they ought to be living in doesn't seem to correspond to reality.
Anyhow, as long as buying property and paying a mortgage every month remains cheaper than renting then it makes sence as an investment regardless of house price growth. It's another reason why I don't think that prices will crash even if there is due to be some kind of dip, which is pretty much part of the economic cycle.
Yes I doubt prices will crash.
Near me they went up a lot in the 02-07 frenzy and quite a lot have sold for less in the 10-18 period, or have taken 15 years to put on 25% since the 02-07 period.
This summer they’ve been spiked again and I can see the same happening again.
New high but they won’t move higher now for a decade... but maybe some short term losses for those who need to move... but if everything goes down a bit then no issue.
It’s just amazing how people rush to bid prices up and it does no one any favours.
Clearly there have been a decent chunk of cash buyers out there in 2020 and they’ve flooded the market especially with the tax break, and caused hell to break loose.
I’d be surprised if that recurs in 2021, especially if stamp duty returns.
As with 07 ‘crash’ it might just be a case of no one will sell until prices rise again, except those who have to.
So low volumes, thus demand remains relatively high, so prices not as subdued as you’d expect.
All that said, of job losses go up and all these sold stc chains fail over and banks change lending criteria I can see maybe a lot of supply and low demand.
ste market.
Given my time again I’d have sold this spring and put all the money in Tesla haha!
Near me they went up a lot in the 02-07 frenzy and quite a lot have sold for less in the 10-18 period, or have taken 15 years to put on 25% since the 02-07 period.
This summer they’ve been spiked again and I can see the same happening again.
New high but they won’t move higher now for a decade... but maybe some short term losses for those who need to move... but if everything goes down a bit then no issue.
It’s just amazing how people rush to bid prices up and it does no one any favours.
Clearly there have been a decent chunk of cash buyers out there in 2020 and they’ve flooded the market especially with the tax break, and caused hell to break loose.
I’d be surprised if that recurs in 2021, especially if stamp duty returns.
As with 07 ‘crash’ it might just be a case of no one will sell until prices rise again, except those who have to.
So low volumes, thus demand remains relatively high, so prices not as subdued as you’d expect.
All that said, of job losses go up and all these sold stc chains fail over and banks change lending criteria I can see maybe a lot of supply and low demand.
s
te market.Given my time again I’d have sold this spring and put all the money in Tesla haha!
Mortgage approved the other day, another thanks to Sarnie. 10% with Nationwide and it was touch and go for the almost 7(!) weeks processing.
Operation 'full renovation' will be in full force early Jan I hope, and living in a building site for 2 years. Love the smell of lime plaster dust in the morning..
Operation 'full renovation' will be in full force early Jan I hope, and living in a building site for 2 years. Love the smell of lime plaster dust in the morning..
Helicopter123 said:
Nationwide reporting house prices up on average by 7.5% in 2020, best for 6 years.
With the vaccine giving new hope, and a Brexit deal agreed, will renewed confidence drive further gains in 2021?
Base rates low, QE in full flow, BB loans - all that liquidity has to end up somewhere?
Who knows? Prices have been divorced from fundamentals for a long time. It mostly depends on general sentiment on the economy and unemployment figures. Base rates have been low for a long time, they can’t go lower. Unemployment is going to rise for much of 2021, I’d have thought. With the vaccine giving new hope, and a Brexit deal agreed, will renewed confidence drive further gains in 2021?
Base rates low, QE in full flow, BB loans - all that liquidity has to end up somewhere?
We’re not really at a typical point in the boom/crash curve due to the unique scenario we’re in and sheer magnitude of debt/money sloshing around so it’s making reliable predictions harder. At some point bubbles tend to burst, but when?
BMW A6 said:
So an average annual 7.5% price growth, represents an average >£18,000 price increase for an averagely priced £250,000 property.
For those diligent first time buyers, having to find another £18,000 seems madness.
Plus potentially the stamp duty if the holiday is not extended.For those diligent first time buyers, having to find another £18,000 seems madness.
This is the situation the posters on HousePriceCrash don't seem to grasp, they are too afraid to buy just incase the prophecy is correct and prices crash. So they continue to waste money on rent while the amount they need to buy a property is increasing year on year. As the prices increase, they are less and less likely to buy.
They are currently going on about 15% reductions, so the price from two or three years ago when you wouldn't buy because prices were too high and about to crash.
We bought in August this year, the house opposite has just gone on for 13.5% more than we paid and needs fully renovating inside. Effectively we now cannot afford to live where we do, and we certainly could not afford to do the work it requires.
Yet the HousePriceCrash loonies go on about the idiots that have bought property while they continue to rent.
Joey Deacon said:
Plus potentially the stamp duty if the holiday is not extended.
This is the situation the posters on HousePriceCrash don't seem to grasp, they are too afraid to buy just incase the prophecy is correct and prices crash. So they continue to waste money on rent while the amount they need to buy a property is increasing year on year. As the prices increase, they are less and less likely to buy.
They are currently going on about 15% reductions, so the price from two or three years ago when you wouldn't buy because prices were too high and about to crash.
We bought in August this year, the house opposite has just gone on for 13.5% more than we paid and needs fully renovating inside. Effectively we now cannot afford to live where we do, and we certainly could not afford to do the work it requires.
Yet the HousePriceCrash loonies go on about the idiots that have bought property while they continue to rent.
I guess it's also a matter of how much risk are they prepared to take and what house should they buy? Not everyone is comfortable buying when we know a huge recession is underway and both the housing market and rentals are protected by various payment deferral schemes. This is the situation the posters on HousePriceCrash don't seem to grasp, they are too afraid to buy just incase the prophecy is correct and prices crash. So they continue to waste money on rent while the amount they need to buy a property is increasing year on year. As the prices increase, they are less and less likely to buy.
They are currently going on about 15% reductions, so the price from two or three years ago when you wouldn't buy because prices were too high and about to crash.
We bought in August this year, the house opposite has just gone on for 13.5% more than we paid and needs fully renovating inside. Effectively we now cannot afford to live where we do, and we certainly could not afford to do the work it requires.
Yet the HousePriceCrash loonies go on about the idiots that have bought property while they continue to rent.
price/earnings in the UK are absolutely insane.
On a separate note, I have noticed mortgage rates going up significantly since the summer. I'd say half a percent for best deals for HSBC premier and more so if you want to have uncapped overpayments.
There's then the fact that the government has thrown and will throw absolutely everything at the problem to keep real estate prices increasing.
2021 will be interesting. I was comfortable moving in the summer but the numbers don't stack up anymore at the moment.
The government have issued a letter to all solicitors requesting that a pre and post holiday stamp duty figure is provided to the buyer, and the the solicitor must reinforce that that the buyer is liable for the higher amount if completion is after the 31st.
Make of that what you will.
Make of that what you will.
I got approval for my mortgage on the 23rd.
Like MG Chris, it’s a 35 year deal, but at 3.19 instead of his 2.30.
We got a bit of help from our folks to fill in the gap between our deposits and the final bit needed.
Keys collection is 12th February so have time to sort everything else and get looking for furniture etc.
A little later onto the ladder than I would have liked but I didn’t meet the one till later than I would have liked..
The good news is now I can change jobs now we have the approval. So once we get out of Nippys Tier 4 then I can hopefully get that rolling.
Like MG Chris, it’s a 35 year deal, but at 3.19 instead of his 2.30.
We got a bit of help from our folks to fill in the gap between our deposits and the final bit needed.
Keys collection is 12th February so have time to sort everything else and get looking for furniture etc.
A little later onto the ladder than I would have liked but I didn’t meet the one till later than I would have liked..
The good news is now I can change jobs now we have the approval. So once we get out of Nippys Tier 4 then I can hopefully get that rolling.
mwstewart said:
The government have issued a letter to all solicitors requesting that a pre and post holiday stamp duty figure is provided to the buyer, and the the solicitor must reinforce that that the buyer is liable for the higher amount if completion is after the 31st.
Make of that what you will.
I’m still surprised that they didn’t announce an extension a couple of months ago.Make of that what you will.
It has clearly ‘worked’ in that it has further supported house prices through what would otherwise have been a very difficult time, so why stop it now?
It would be understandable if it was part of a standard ‘green shoots’ recovery message, but we are a long way from that at the moment.
Anyone who is looking to move now will surely feel just as penalised that they have to pay an extra £15k in tax compared to those about to complete?
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