'Stagnation' hits property market

penguine

We have a substantial deposit saved and are in fairly secure jobs so shouldn't have a problem getting a mortgage. We could buy a house now in our area, but we're planning to wait until the end of 2009 before we even start seriously looking again. We want a long-term home, and don't want to spend the next few years kicking ourselves because we could have gotten a bigger/cheaper property if we'd held out longer.

Squish_21

penguine wrote: »

We could buy a house now in our area, but we're planning to wait until the end of 2009 before we even start seriously looking again. We want a long-term home, and don't want to spend the next few years kicking ourselves because we could have gotten a bigger/cheaper property if we'd held out longer.

Its hard init, the price could start levelling off/rising again towards the end of 2009 OR they could still be dropping fast. Its a gamble with no fixed answer.

I shall be keeping a watchful eye on houses in my area during 2009!

mewbie_2

spuds wrote: »

I think staganation is exactly the right word.

Er. not quite.

harryhound

When the majority of houses on the market are not selling, the prices of the few that do sell are not comparable with the old days when the majority of houses sold with weeks.

There is a thin market involving those who need to buy or sell for personal reasons, while the rest are sitting on the side lines.

I don't think we will see a willing market of buyers and sellers this side of 2010.

zarazara

Just goes to showhow overpriced they all are.

aqueoushumour01

There have been vast discussions about the HPC - but let's put this into context: house prices have dropped by around 12-14% over the year, but what's that compared to the fall in equity and commodity markets (and sterling!) : all three were significantly overvalued due to all being built on mountains of credit, where previously we believed the fundamentals to be sound.

I don't know the figures but average house prices substanitally rose in value over the last 10 years and a 14% fall is not much once put into that context. I think it's likely there is more to go as sellers realise that the price they're holding out for is not going to be realised, although I'm not going to start predicting where house prices are going as the economy is a law unto itself!

Generali

IveSeenTheLight wrote: »

It's quite possible you could see prices drop that much in your area.
I posted on another thread a link showing that in some areas in the last quarter, prices have increased

If you take the top 10 rising areas you'd expect to see price increases!

The point you make is a good though - averages give us an indication of where the market is going but not the price of a specific house. One of the things about house pricing is that properties aren't fungible, they are all different. That makes pricing difficult and allows people to kid themselves about value.

One economic/psychological experiment seems to show that people put a higher valuation on something they already own more highly than something they don't .

besonders1

Its true that over the last 7 years ,the valuations had a mind its own, instead of being based on affordability as they were in the past. There will definitely be a lot of disappointed sellers and property developers this year. If sellers refuse to reduce their prices, the market will take years to recover, (probably once we start to forget about the property shows propaganda) then hopefully the market will start moving again but at sensible prices.

harryhound

The reason why shares are down 1/3rd all over the first world is that there is still a market in shares. Those desperate for cash can sell their shares.
These spluttering real estate sales down 2/3rds cannot realistically be called a market, more of a swap shop. When bankers to small businesses really start calling in their guarantees we are likely to see the market going into the auction arena, where prices really are down 40 - 50 %.

zarazara

Its all down to pricing. The price of anything is only what someone else is prepared to pay for it, be it a pencil or a rocketship.
If its cheap enough it will sell, but that price may be waaaayyyy below what the seller expects.
so, if the people selling houses at, say, £200,000 reduced them to £20,000 they'd sell alright.