House prices need to drop 40% to be affordable discussion

de1amo

i do wonder if buy to lets are included in BS data?-as a more commercial type of loan BTLs will tend to use banks(i would guess)-the BTL market appears to be booming according to threads i have seen on here which will mean the prices have got low enough-and rents high enough to attract in the people who want to invest in housing(as opposed to pensions)--i am sure the BTLs will distort the data held by BS's about mortgages when it comes to gauging price levels.

IveSeenTheLight

Loopgames wrote: »

But the 'average' may not reach that value in the area...it may just be a few anomolies.

Of course there are always exceptions and you sound like you are getting / have a good idea of your local market.

It sounds like you will be very well placed to grab a bargain should one come up.

Good Luck

Pimperne1

IveSeenTheLight wrote: »

Of course there are always exceptions and you sound like you are getting / have a good idea of your local market.

It sounds like you will be very well placed to grab a bargain should one come up.

Good Luck

I also wish you good luck and would point you toward the Propertybee facility available with Firefox which scrapes the prices from Rightmove and then when you view a property it "adds on" anything that has happened since it was put on the market.

http://www.property-bee.com/

geneer

IveSeenTheLight wrote: »

As a poster who believes there will be 40% nominal drops from now, I'm interested to know the area you are referring to.
IIRC it's just outside Manchester.

Looking at the Machester Metropolitan area, it seems to roughly reflect the UK average.

Peak in 2007
Sharp correction to beginning of 2009
Rises through 2009 into 2010
Another correction downwards
Now indications of stagnation

£60K off your average gaff.
Yay. Bulls win!

IveSeenTheLight

geneer wrote: »

£60K off your average gaff.
Yay. Bulls win!

I believe you have miss-read the information presented in the graph.
The Y axis is not house prices, but an index.

geneer

IveSeenTheLight wrote: »

I believe you have miss-read the information presented in the graph.
The Y axis is not house prices, but an index.

I believe you are right.
So what does it represent Light?

IveSeenTheLight

geneer wrote: »

I believe you are right.
So what does it represent Light?

It represent an index from when the base start period was set to 100.

Increases and decreases are then based on that base start figure.

This area is showing 60 points below peak.

The peak price was April 2008 at £121,253.
Currently it is sitting at £96,679.

This represents an average drop of £24,574 or 20.2% below peak average.

The index appears to amplify rises and falls, it is quite usefall therefore to look at the actual prices instead of the index.

[IMG]http://www1.landregistry.gov.uk/Apps/house-prices/house-price-index-custom-reports/hpi_report.asp?g=1&a=Manchester&s=01 January 2007&e=01 September 2011&t=2[/IMG]

Pimperne1

IveSeenTheLight wrote: »

I believe you have miss-read the information presented in the graph.
The Y axis is not house prices, but an index.

You made that too easy. You're supposed to start with:

"How do you work that out?".

geneer "Cos prices peaked at £285k and they are now at £225k".

ISTL "No they haven't".

geneer "Yes they have, anyway I didn't say they had".

etcetera etcetera

geneer

IveSeenTheLight wrote: »

It represent an index from when the base start period was set to 100.

Increases and decreases are then based on that base start figure.

This area is showing 60 points below peak.

The peak price was April 2008 at £121,253.
Currently it is sitting at £96,679.

This represents an average drop of £24,574 or 20.2% below peak average.

The index appears to amplify rises and falls, it is quite usefall therefore to look at the actual prices instead of the index.

[IMG]http://www1.landregistry.gov.uk/Apps/house-prices/house-price-index-custom-reports/hpi_report.asp?g=1&a=Manchester&s=01 January 2007&e=01 September 2011&t=2[/IMG]

Thanks Light.

I'll ammend my original post then.

"£60K off your average semi-detatched house.
Yay. Bulls win!"

geneer

Pimperne1 wrote: »

You made that too easy. You're supposed to start with:

"How do you work that out?".

geneer "Cos prices peaked at £285k and they are now at £225k".

ISTL "No they haven't".

geneer "Yes they have, anyway I didn't say they had".

etcetera etcetera

But instead Light pointed out I had misread the graph and I admitted my mistake. The absence of the often typical excrutiating pedantry was quite refreshing.

Leaving it up to you to be the only one not to confound increasingly low expectations.