Asking prices fall 1.1%

Graham_Devon

ess0two wrote: »

Best of luck,but the next period will see withdrawal of property from the market,repos are at an all time low,coupled with IR'S.
Hence what caused the rises,late last year into this year.

Accept this time, we have the spending review coming up, which could map out an entirely different road.

Plus, even if prices do rise again on the back of sellers pulling property and banks still halting repo's, at some stage, it will fall down again.

Same !!!!!!, different day, as they say.

Prices rise, sellers try to sell, so prices fall, sellers pull out, create lack of properties, prices rise, sellers try to sell, creates over supply, prices fall, sellers pull out, creates low supply, prices rise....and so on.

In the meantime, the banks will still be holding back on repo's etc? Interest rates will always be 0.5% allowing mortgages to stay low and this to happen over and over?

Yer, I'm not to sure that sellers pulling out simply because prices fall and therefore prices rise, just like before is all that simple.

Graham_Devon

timski8000 wrote: »

I struggle to really understand the mathematics behind house prices and why 1. The media reports house price-falls like Hitler has been re-incarnated and 2. Why many who own their homes (pay a mortgage) listen to such media reports and believe they are getting wealthier whenever prices go up?

Seriously, most home owners seem obsessed with prices going up but I struggle to see how this benefits anyone but those down-sizing. I mean if I own a £100'000 home and it goes up 2% it is worth £102'000.

The owners go woopie but if they want to move down the street to a house that was worth £200'000 and also went up by 2% then this house would now be worth £204'000.

The maths says that this new home is actually more expensive as the difference between the two is now £102'000 (£204'000 - £102'000) rather than £100'00 (£200'000 - £100'000).

I understand that you would effectively have a £100'000 mortgage on a property 'worth' £102'000 but you will always need a house so it's pointless!!!

What is the whole obsession with prices going up - all it does is hurt the aspirations of those further down the age scale (a situation that is dangerously prevalent throughout most other areas of society).

Hopefully someone with a better financial understanding and, more importantly, without a biased "i'm a home owner" mindset could inform me if this view of rises benefitting almost nobody is incorrect.

(And yes i'm quite clearly a dissalussioned 24-year old renter who despairs at his inability to even consider buying somewhere modest to live).

Re-mortgaing and pulling the cash out of the bricks was a huge reason as to why some homeowners (not investors) went "woopy" when prices went up.

They could take equity out, and the price rises would pay for the equity they took out. Some were able to do this several times over, and still see further equity pay for it, in terms of LTV.

As I said on another thread, a family friend shocked us when we found out they look to lose their house after taking equity over and over, though looks like they have a buyer now....but will have to go into a much much smaller house and move area to buy another place to retire in.

des_cartes

MadnessOfHPC wrote: »

Except, NOT accept.

Accept the offer price. You know it's the most you'll get for a few years:D.

timski8000

Graham_Devon wrote: »

Re-mortgaing and pulling the cash out of the bricks was a huge reason as to why some homeowners (not investors) went "woopy" when prices went up.

They could take equity out, and the price rises would pay for the equity they took out. Some were able to do this several times over, and still see further equity pay for it, in terms of LTV.

As I said on another thread, a family friend shocked us when we found out they look to lose their house after taking equity over and over.

Yes i've seen some absolute horror stories with amateur BTL investors releasing and re-investing the equity from their properties and ending up with portfolios in the millions from an original deposit of circa £10k!

I just want one house for me to live in!...

des_cartes

timski8000 wrote: »

Yes i've seen some absolute horror stories with amateur BTL investors releasing and re-investing the equity from their properties and ending up with portfolios in the millions from an original deposit of circa £10k!

I just want one house for me to live in!...

That would be portfolios in the millions with debts in the millions plus a bit more.

Thrugelmir

Blacklight wrote: »

A £2m house in London reduces by 0.1% (£2,000) and a £100,000 house in Belfast by the same amount (2%). The headline is 'Asking prices fall by an average of 1.1% across the country", when in fact they haven't.

There are very few transactions for properties over £2 million annually. Let alone £1 million.

So have a minimal influence on average house prices.