can someone please answer this for me...

The_White_Horse

so why aren't the figures adjusted for the amount of sales?

Really2

The_White_Horse wrote: »

so why aren't the figures adjusted for the amount of sales?

No need for a mix adjustment on 1 sale is there?

There would be for the average UK price but your one sale would have achieved the price it had it is indisputatable how much in % how much it has risen??????

silvercar

Big house near me sold for 755k in 2007, now on the market for 925k! I've watched the work being done, new double glazing and new central heating system. By the look of the pictures also new bathrooms. They failed to get planning permission to install gates across the whole frontage of the property. Cost of works is in the region of 50k, if that is reflected in the price (and I'm not sure that DG always is and the bathrooms were nice enough before) that's a 15% increase on 2007 price.

nearlynew

The_White_Horse wrote: »

please can someone please explain how house prices are still going up when lending is down, salaries generally are down and the mood is just down?

thanks

That's easy.

They're not.


It's all smoke, mirrors and lies.

Really2

nearlynew wrote: »

It's all smoke, mirrors and lies.

No that's a Gentlemen's club.

Turnbull2000

Even though there's less mortgage finance available, it simply translated into fewer transactions at near peak prices. Also, mortgages for those with 25% or more equity are also immensely cheap and often below inflation.

Salaries falls are largely irrelevant at the moment, just as static salaries were largely irrelevant during the boom, particularly as new lending is formulated on affordability criteria - a method which allows buyers to stretch themselves further.

mcc100

please can someone please explain how house prices are still going up when lending is down, salaries generally are down and the mood is just down?

There are a couple of reasons that house prices have remained buoyant.

The first one is the fact that many small to medium sized developers have continued building new houses and are taking the option to rent them out as they are unable to sell them.

To do this many are using their own funds to purchase their own properties from their own company and consequently each purchase becomes another sold property in the statistics.

However as they are buying their own properties they can set their sold price at a figure that benefits their company, which may well be a higher figure than what the property is worth.

Secondly large developments have to consist of approximately 25% - 33% of social housing. These properties are bought by housing associations and I suspect they appear in the statistics as sold properties and at a price agreed in the past which may well be higher than would be expected at present.

HAMISH_MCTAVISH

mcc100 wrote: »

There are a couple of reasons that house prices have remained buoyant.

The first one is the fact that many small to medium sized developers have continued building new houses and are taking the option to rent them out as they are unable to sell them.

To do this many are using their own funds to purchase their own properties from their own company and consequently each purchase becomes another sold property in the statistics.

However as they are buying their own properties they can set their sold price at a figure that benefits their company, which may well be a higher figure than what the property is worth.

Secondly large developments have to consist of approximately 25% - 33% of social housing. These properties are bought by housing associations and I suspect they appear in the statistics as sold properties and at a price agreed in the past which may well be higher than would be expected at present.

Well that might account for a few tens of thousands of sales a year.

But it's nowhere near enough to skew the figures on a million house sales a year. Particularly when such sales are not included in most of the indices.

The reality is that prices are rising because we don't have or build enough houses.

It really is that simple.....

Emy1501

1) sales transactions in 2009 and 2010 so far were low but the numbers needing to buy were higher than the numbers needing to sell so prices on average went up. Does not mean though that the average house is worth more though as there are lots of people who cant sell and wont sell for less than say 2007 prices.

2) IR's are very low therefore savings are not worth much. Therefore more and more have invested in property where they will get a return through rent at a much higher price than in the bank. Also low IR's have meant some who would have been forced to sell because they could not have paid the mortgage have found meeting their repayments easier.

3) The bailout of the Banks and QE meant the bankers made a come back. They also made a killing on the stockmarket and therefore bonuses were big. I know a couple of them in mid 30's who would have made 400-500K after bonuses. This has allowed some areas of London to go past 2007 peak and John Lewis to make record bonuses.

As for your friend well it could be one of 3 things IMO. Either he vastly overpaid in 2007, The valuer has been over cautious or he lives in an area which simply has not recovered from the crash.

Remember most areas are still 10-15% below peak.

tomterm8

The_White_Horse wrote: »

please can someone please explain how house prices are still going up when lending is down, salaries generally are down and the mood is just down?

thanks

If you owe £350,000 on a house, and can only sell it for £250,000, and you are not forced to sell up because you can repay the mortgage, would you

(a) sell it
(b) continue living in it without repairing it, because you hear property prices are rising or
(c) ?

If the answer is b, the fact you can't sell the house for the same price as you bought it for means it isn't going to show up on aggregate house price figures.

If my theory is right, the market volume would be very low, total value of mortgages would be falling, and measures of house prices would be rising.