[url= http://news.bbc.co.uk/1/hi/business/7977683.stm ]BBC House price surprise bounce[/url]
had a chat to my agent yesterday.
He still thinks its going to be a flat market for most of the year. Mortgage approvals were up in Q1 this year hence price jump. He reckons most prices are 10-20% off peak of Q4 07/Q1 08 and will stay there for a bit longer.
yeah i reckon its just marketing spin and wishful thinking from a building society
Isn't it interesting that as mad speculation about property price rises caused a good amount of this mess in the first place, a blip is being referred to as signs of "recovery". Seems we'll never learn.
We did the recovery over the last year didn't we?
its a reprieve afforded by low interest rates. wait til rates go up, then it'll crash properly.
Blip.
Very distorted market at present as there are few willing sellers (not wanting to recognise the fall in value) & few willing buyers (most people are waiting to see how far prices fall), plus limited finance for first time buyers.
Prices are probably ~20% off the peak with 10%+ more to go. We'll only find out when the market gets more active, but limits on salary multiples and far more caution about both lending and borrowing will prevent property being the get rich quick scam that it was, at least for the next few years before we all forget.
Good for the economy if that happens, plus we might get rid of some of those dreadful programmes on TV.
will rising interest rates (which aren't gaurenteed, but likely) push prices down in numerical terms or just in relation to earnings (which presumably will go up with intrest rates)
look at the relationship between average house prices and average salary.
if 'average people' can't afford 'average' homes then prices must fall into line.
[i]if 'average people' can't afford 'average' homes then prices must fall into line.[/i]
as long as supply is out of sync with demand that's not neccessarily true.
Supply isn't out of sync. Plenty of unnoccupied houses in Newcastle and there aren't thousands of families living on the streets.
In my opinion, the sign of the market bottoming out will be when banks start offering 100% (or close to 100%) mortgages again. When this happens, this will mean that banks are confident that even if a buyer can't pay their mortgage, the bank will be able to sell the repossessed house for the same amount that was borrowed and get their money back. This won't happen for quite a while.
I personally reckon the prices have got a way to fall yet - it will be the redundancies that cause it - the market will get flooded with repossessed houses, and so the prices will be forced down.
I'm still waiting to buy my first house (have been for about a year and a half) - mortgage all agreed, just waiting for the crash - living with parents is shit, but better than losing approx 3k a month on the value of your house.
Supply is massively out of sync in certain markets. I didnt imply all markets.
tomthumb's aphorism that [i]if 'average people' can't afford 'average' homes then prices must fall into line[/i] is incorrect, in that "average people" arent the same as "average homebuyers". The second set is a function of supply, only those that can afford to participate in the restriced supply market (the relatively better paid) make up the group of purchasers. They, by definition will have a higher salary.
One of the most concrete tenets of property markets is "Location, Location, Location". Markets are highly constrcted geographically. Location has almost no substitue product except for commuting.
I think a lot of people will be wanting to make unforced purchases ie trade up, since the next house up the ladder is now so cheap. A lot of people still have jobs and have a stack of equity in their house despite the price falls.
new regulation is likely to make it more difficult to offer 100% mortgages. banks will also be wary for some time to come of that, even if they're allowed to offer them.
Dive prices, Dive!! So I can finally afford ot get on the market 🙂
Well today there was a further $1 trillion of funding announced on top of the already announced $2 trillon of funding to get the global economy working again.
Although people may think housing may become affordable and prices may rise, you, your children, and their children are going to be facing some preetty interesting tax rises in the decades to come. So maybe not quite so much money left each month for the mortgage ay? Who knows what's going to happen, but it isn't looking too good right now.
although since brown dropped the interest rates 8bn quids worth of mortgage has been repayed [url= http://news.bbc.co.uk/1/hi/business/7976111.stm ]according to this[/url]
i realise that people on an average wage will not necessarily buy an price house but if house prices continue to remain as high as they are ownership will be the premise of the few not the many.
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borrowed from the bbc http://news.bbc.co.uk/1/shared/spl/hi/guides/456900/456991/html/nn2page1.stm
the gap cannot continue to widen if first time buyers are to buy with there own money. most of my (graduate) friends have moved back into their parents home as rent is the difference between saving and existing.
That graph has obviously fallen back somewhat now - average price around £150k? Salary multiples are only part of it though, interest rates have been lower over the last 10 years then the previous 10 years so debt was cheaper and multiples could go up.
[i]most of my (graduate) friends have moved back into their parents home as rent is the difference between saving and existing.[/i]
you should see the state of Spain or Italy!
The fact that prices have fallen isnt going to make them any more affordable to the lower incomes. Paradoxically the affordability of housing will have decreased as the capacity to borrow has been reigned in. Gearing leads to price rises where supply is constricted. The only way to reduce the cost of housing is to encourage business/industry and hence employment, leisure, community away from high resi demand areas (such as SE) and then fund infrastructure construction on ear-marked resi sites, that have highly restricted planning consents and then jointly develop with house builders. Simultaneously flooding a market with housing in collusion with house builders will ensure that house prices are a function of costs of construction (+ developer's profit) i.e. supply driven pricing, NOT a function of restricted supply and land price residuals as we have now (Demand driven pricing)
Given that most people who vote own a house and meaure their worth in life by the increasing value of their house, anything that keeps prices high is a vote winner. I dont see any government doing anything to make it easier for first time buyers.
All the gov wants to do now is get back to the days of growth and rising house prices. All banks want to do is make money and market share - they will attempt to do this whateve the restrictions forced on them.
Face it, if you were offered a bounus in the hundreds of thousands youd work damm hard to get it, if you didnt someone else would soon be along to do your job.
So soon it will be back to normal.
Maybe back to normal, but I am reminded of this Cree quote
"Only when the last tree has died and the last river been poisoned and the last fish been caught will we realise we cannot eat money."
no ,but we can buy new shiny things with it.
mmmmmmm..shiny 😉
House prices were and in some cases still artificially high. The last few years have been ridiculous. Short-sighted half-wits waffling on about how much there houses are worth ....and yours must have shot up in value since the extension... Don't know and don't care. It's for my family to live in,not a get rich quick scheme.
Dead cat bounce in a distorted market - you get rallies in bear markets be it stocks and shares, currencies or housing - they will (in my opinion) continue to decline to around 2003/2004 levels (maybe over shooting as markets generally do) and stay flat until (or if ever) banks allow daft borrowing criteria, which of course under new regulations and ownership they may not.
Demand and supply is not really an issue as such in terms of people needing houses - the supply of money is more the issue.
i'm not a doom and gloom merchant i have a house, i don't care where the market goes, i'm not looking to move, borrow or re-mortgage as i don't have one - i just read it how i see it. The housing market is a market like any other - peaks and dips - but never NEVER goes in the same direction for ever.
In answer to the OP - who knows? Flip a coin
You can get all the opinions you like but remember that very few indeed saw the current state of affairs coming round the corner like a steam train
The only investment I consider my house to be is a saving on rent as it's my home, not a money making scheme. All things being considered, if I sell for more than the difference between the purchase and the rent I would have paid over the same period, I'm up.
It all is regional anyway - the headlines about massive falls and so on simply do not apply around here. Prices have been static for a couple of years - not rising and remain static - not falling.
wait a minute according to this morning headline [url= http://news.bbc.co.uk/1/hi/business/7980813.stm ]they infact dropped in march[/url]
TJ where are you based?
chiswick has seen 20-30% drop in asking prices if not more
Well, given all the houses and all the estate agents Id say 0.9 percent is small enough to be:
a) a rounding issue
b) too small to count
c) within the range of normal errors
So really the headline should have read - house prices stay still.
Kimbers - Leith / Edinburgh
Maybe a special case and no doubt activity has been down but actual selling prices don't seem to be. According to some surveys Scotland has hardly been affected at all
I think this is purely because Leith has not seen much in the way of price rises for 2 or 3 years
[i]0.9% compared with the previous month.[/i]
Wow, now thats a 'bounce'?!!! People are hoping its the bottom of the market. LOL.
Plus who owns the BBC? 😉
Down 1.7% last month according to Halifax...no bounce, not even a dead cat, just an anomaly. They have a long, long way to go yet....when the average wage is around £25k, and the average house is still around £150k, the maths just doesnt add up does it? Add to that rising unemployment and wage deflation, and there can be only one way for them to go.
[url= http://news.bbc.co.uk/1/shared/spl/hi/in_depth/uk_house_prices/html/23ub.stm ]http://news.bbc.co.uk/1/shared/spl/hi/in_depth/uk_house_prices/html/23ub.stm[/url]
I think that somes it up quite well, neighbouring areas and massive variations in price changes.
Always buy the cheapest house in the best area you can afford. People want to live in Cheltenham, people don't want to live in Tewkesbury.
this is quite amusing though
[url] http://news.bbc.co.uk/1/shared/spl/hi/in_depth/uk_house_prices/html/23ub.stm?f [/url]
88% on the year quite a rise....
chiswick has seen 20-30% drop in asking prices if not more
According to mouseprice.com the house I sold near Stamford Brook, Chiswick 2 years ago (a bit below the peak) is down 3 or 4% in that time whilst the house I bought in Bookham, Surrey is down about 10%; oh well!
this was on at 325 last summer, just round corner from us
[url= http://www.homesandproperty.co.uk/sale/london/west-london/london-w4/1-bedroom-flat-sale/3068-3479293.html ]its now on at 260[/url]
Does that count as Bedford Park? Guess not but it is close and Bedford Park can get pretty crazy with prices. I was the other side by Wendell Park which isn't such a crazy place.