Have house prices dropped?!!

QTPie

jockster211 wrote: »

Unfortunately recent 'news' that house prices in Scotland are unlikely to be severely affected by the downturn/recession/housing crash, has led many north of the border to stick to the 15% over price. Average drop in my area I'd say is around 5% from a year ago, but many prices simply have not budged.

My missus & I have been viewing & offering 'cheeky' bids at somewhere around 15% under the 'offers over bit' still with no joy. Shame is its by & large the same houses on the market that were there a year ago. Some sellers will take time to take the reality check:rolleyes:.

Is it the same all over the UK just now or is this some local economics going against the tide?

Jockster

What sort of house are you looking for?

If it is a larger "family" type house (i.e. at the higher end of the property ladder), then you are not alone: it is the same where I live (city in the South West). Every house that I am interested in is priced like there has been no market drop (i.e. "late 2007 and then some" prices"). No matter how much I jump up and down and say "you house should be priced by 2004 standards", it wont make the blindest bit of difference. Generally those at the higher end of the property ladder have more too loose by dropping their price and they see that as a valuable part of their retirement income etc... so are prepared to hang on.

House prices/values are set by BOTH the buyers and the sellers... yes a buyer has to be willing to buy a house at that prices, but a seller also has to be willing to sell it at that price too. If the sellers are willing and able to "sit it out" (be it for a year, 3 years, 5 years or 7 years), then prices will not go down: the market will stagnate instead. Of course you could get fortunate and someone will "have" to sell and one of your offers will get accepted

Good luck
QT

GDB2222

IveSeenTheLight wrote: »

You are talking UK averages here.
There were some areas in the last down cycle that recovered within a year

Could you please name one and give a source for house price data in that area?

Speaking from memory, during the previous peak/trough some areas, eg Scotland, had not gone up so much and had less far to fall. This time round, pretty much the whole of the UK shared in the boom.

carolt

whathavewedone wrote: »

CF and Carolt - I absolutely agree that anyone who needs to sell their house be it at the top or bottom of a chain will set the market rate for similar houses in similar areas.

I don't think that's particularly relevant in relation to my point about upsizers and downsizers though. My point was that people who can stay put will stay put until the market rises again whether that be out of stubborness, vanity or simply because they want to have more money to play with when they retire. The reasons are irrelevant. It's the effects that matter.

The result of this is that would be upsizers in 2/3 bed houses can't afford to reduce their prices because they can't afford to buy anything else. So they reluctantly stay put.

Actually, the stastistics paint the opposite picture.

3 bed houses are falling very fast; 4 bed plus houses are not falling as fast.

I don't know whether that means some of the 3 bed house owners are also downsizing - after all, not everyone ends up in 4 bed plus - or, more likely, that they've built up plenty of equity and so can afford to take some of the hit, whilst the people they're selling to largely haven't. People in 4 beds are usually only selling to those with large existing equity so have felt less need to reduce.

Don't know - just my theory...

Nevertheless, the facts on the ground - posted Motley Fool article on this a couple of weeks ago, if anyone wants to kindly dredge it up for me - seem to be that 3-bed prices are falling fast.

whathavewedone

Yes I won't disagree with you on that but I'm assuming that the 3 bed sales are due to one of the 3 Ds as otherwise 4 bed plus houses would have fallen by similar amounts percentagewise when they clearly haven't.

As for downsizing from 3 beds well yes some will (my mum is thinking of moving from a 2 bed to a flat) but they will be in the minority of buyers especially in this market. When we sold our 3 bed semi in 07 the only viewers were downsizers and FTBs or second buyers. The people that bought our house moved from a 1 bed flat. Most of our neighbours were elderly people who had downsized from larger family homes at some stage. Next stop home/grave!

carolt

whathavewedone wrote: »

Yes I won't disagree with you on that but I'm assuming that the 3 bed sales are due to one of the 3 Ds as otherwise 4 bed plus houses would have fallen by similar amounts percentagewise when they clearly haven't.

As for downsizing from 3 beds well yes some will (my mum is thinking of moving from a 2 bed to a flat) but they will be in the minority of buyers especially in this market. When we sold our 3 bed semi in 07 the only viewers were downsizers and FTBs or second buyers. The people that bought our house moved from a 1 bed flat. Most of our neighbours were elderly people who had downsized from larger family homes at some stage. Next stop home/grave!

Don't people in 4 bed houses face the 3 D's too?

Or are they immune?

Cannon_Fodder

IveSeenTheLight wrote: »

This was the standard and minimum percentage to go over a couple of years back in Scotland where they operate a sealed bid system. It was standard to put in a price lower than the valuation to generate interest and then receive bids above the valuation.

Not sure at the moment as have not seriously been assessing the buying market for the last 2 years (Last bought Jan 2007)

Certainly does not fall into your no-one will ever statement

The OP is in Essex, I don't think the Scottish system is relevant.

whathavewedone

Carolt, yes people in 4 bed plus houses still die and get divorced but fewer will be in debt (which is a big driver of sales in recessions as I'm sure you know) as they are the people who are most likely to have paid off their mortgage.

As has already been pointed out by many people several times on this thread

Even you have agreed that 4 bed plus houses are not falling in value at the same rate as smaller properties. What would be your explanation of that then?

You do like to nitpick don't you?

MrsPitcher2b

Ok sorry i didnt mean to start some big debate i was more venting my frustration really because i hear so much about the crash but cant seem to be finding anything...

Its in Loughton, Essex (IG10) but i would more consider it Debden. I think its jumping on being in 'Loughton' to hold onto the price. There is a similar but bigger flat up for sale for £150k - but not Offers in excess of, just up for 150, so was thinking of going to see that and offering 130.. There are a few other 1 bed flats which seem to be low in price, but i think its harder to sell a one bed in the future.. And looking at a post on here today regarding house prices dropping until 2011!!! I think we may stay put for a bit..

carolt

whathavewedone wrote: »

Carolt, yes people in 4 bed plus houses still die and get divorced but fewer will be in debt (which is a big driver of sales in recessions as I'm sure you know) as they are the people who are most likely to have paid off their mortgage.

As has already been pointed out by many people several times on this thread

Even you have agreed that 4 bed plus houses are not falling in value at the same rate as smaller properties. What would be your explanation of that then?

You do like to nitpick don't you?

I gave my explanation already - see above.

Do you have a problem with your ideas being examined and criticised?

Don't post them on a public forum then.

whathavewedone

But you weren't examining and criticising my ideas as you so grandly and pompously put it.

I didn't see the point of repeating yet again the fact that people in the biggest houses are the least likely to be in debt in the post that you nitpicked at because it would have been tedious and pointless to do so. You and I had already established that we were in agreement on that. So how exactly were you examining and criticising my ideas?

The main thrust of the post that you criticised was that people in 3 bed houses or smaller are more likely to be in debt than those in larger houses and that is my best guess as to why those houses are losing value more quickly. If you had wanted to "examine" and "criticise" my ideas it might have been more useful if you had actually come up with some sort of response to that.

Sometimes people on here nitpick and take the mickey out of people for poor spelling, grammar, sentence construction etc and I don't have a problem with that (even if it's directed at me believe it or not) if it's done with wit, which it often is.

I'm not saying that every post has to be made with the sole purpose of furthering the debate but if you are going to nitpick at least do so with wit and a bit of self awareness. Then you would be entertaining people rather than boring them and making yoursef look like a very feeble point scorer.