Hometrack:+25% in some areas, Sharpest price rises in 6 years, insufficient supply

HAMISH_MCTAVISH

House prices are surging at their fastest in six years with some boom areas soaring by 25 per cent.

A property shortage coupled with more accessible cheap home loans backed by the Bank of England and the Government are driving the market.

Recently gentrified parts of London are even the scene of bidding wars as prices rocket by up to a quarter, said estate agents.

In recent months, there has also been a sharp increase in sales in many parts of England and Wales, reminiscent of previous booms.

http://www.dailymail.co.uk/news/article-2331642/House-prices-sharpest-rise-years-areas-Brixton-25.html

However outside of those few hotspots, price rises are far more gentle.

-Prices rose by 0.4 per cent month-on-month in May

-Excluding London/SE just 0.1% month-on-month in May

I suppose the question is will large price rises ripple out from the hotspots within a couple of years as has been the case in previous booms?

Or will the mortgage market remain largely dysfunctional with endemic mortgage rationing, preventing most people from buying, and thus keeping prices artificially low for the lucky few that can get a mortgage... although at the cost of excluding most people from the market.

Only time will tell.

carslet

I was talking with a friend who is looking to buy a house, (yorkshire area) and they said that all the houses they have asked to view have been sold and are sellling faster than ever, some only coming on to the market for a few days. Things do seem to be changing, and quite rapid too.

HAMISH_MCTAVISH

carslet wrote: »

Things do seem to be changing, and quite rapid too.

Yep.

Latest quarterly data from Halifax has Scotland up 9% in the last 12 months.

Mr._Pricklepants

Brixton is skewing the market.

HAMISH_MCTAVISH

Mr._Pricklepants wrote: »

Brixton is skewing the market.

Brit will not be pleased....:D

Mr._Pricklepants

HAMISH_MCTAVISH wrote: »

Brit will not be pleased....:D

Haven't seen brit around for a while...wonder why.
He seems to be more active on the house buying board nowadays, dissuading potential FTB's from buying with his usual multi-font, multi-colour blubbering and obligatory graphics.

brit1234 wrote: »

Help to buy is a scam just to benefit the builders not buyers. The builders fund the Conservative party millions and get hundreds of millions back in kick backs. The scheme is designed to keep prices inflated and the buyer to overpay.

Thankfully, nobody seems to take him seriously there either.

Anyway, apologies for going off topic.

HAMISH_MCTAVISH

Mr._Pricklepants wrote: »

Thankfully, nobody seems to take him seriously there either.
.

Yep.

Not helped by the fact his signature stopped being updated in Sept, the last time prices were negative.:D

ruggedtoast

So the help to buy scheme, designed (allegedly) to help people who are priced out, to buy; is itself pushing up prices and further pricing people out.

And when the funding for this cynical waste of public money is removed; as it will be, what will happen to the people who paid inflated prices under this scheme?

HAMISH_MCTAVISH

ruggedtoast wrote: »

So the help to buy scheme, designed (allegedly) to help people who are priced out, to buy; is itself pushing up prices and further pricing people out.

Nope.

A lack of supply is pushing prices up as demand starts to normalise now that these schemes are making the dysfunctional mortgage market a bit more functional.

And when the funding for this cynical waste of public money is removed; as it will be, what will happen to the people who paid inflated prices under this scheme?

These schemes will only be removed once lending markets have returned to a more normal state. At which point they'll no longer be needed.

padington

ruggedtoast wrote: »

So the help to buy scheme, designed (allegedly) to help people who are priced out, to buy; is itself pushing up prices and further pricing people out.

And when the funding for this cynical waste of public money is removed; as it will be, what will happen to the people who paid inflated prices under this scheme?

Not sure they'll ever want to pull funding now, no British government is going to jeopardise a price crash of the UK's most important asset group. I can see this being a permanent fixture now. Early birds will benefit, those that snooze will lose.

quantic

Anecdotal but...

We are planning to move in the next year and so have been keeping an eye on the market for the past 6 months or so.. there seems to be a stock of houses which are over priced or not as nice as they seem in pics, which have been on Rightmove for a good while, some of them have been on since the last time i looked before buying this one (3 years ago)...

However, whenever a house comes on, which is presentable, reasonably priced, they literally sell - sometimes that day, my friend is moving at the moment, has been to see 9 or 10 in the past 2 weeks, all of them have sold before hes been able to even put an offer in.

The last 3 houses that sold in our estate all sold for asking price and within a week. Whereas others which have been up for 6 months + have not sold.

I was talking to the estate agent about it, he said its a great market, either immediate or none existent, they either sell pretty much immediately for asking price or they dont sell at all.