MSE News: House prices continue to rise, says Halifax

HarryBarry

Excited13 wrote: »

This isn't scientific or anything other than personal experience. If you don't agree fair enough but this is my experience...

In the last 18 months credit has been thrown at me left right and centre despite selling a house (massive loss) and moving into rented accommodation. The companies I had already had credit with are constantly increasing my limits.

I went to buy a house at the start of the year and was offered 4 times my income on a mortgage. Now I'm being offered 5+ times my income and the lack of checks by some lenders is scary.

Back to the point of house prices there are two houses within the last couple of weeks I know of that have gone above asking prices. The housing market is moving very quickly in the area I currently live.

In January this year it was easy to find a 4 bed detached for under £200k but now if you find one it isn't in a good area and the 4 beds are closer to the £250k mark.

I'm sure there will be many local stories like that, there has been ever since prices crashed, but generally speaking the stats are not much different at all. I've monitored my local areas for a good few years now and seen a bit of a rise this year where I live, but the same thing happened in 2010 and then was dead last year. An area quite near me (not bad at all) is seeing its lowest prices for years, so easy to see how it all evens out.

Would be interested in knowing who will lend you 5+ times your wage. I have been monitoring this for a few years and all of the lenders with the best rates are still offering me the same amount. (Just to add I havent monitored it for years for fun, partner owns her house outright so have been monitoring it all with a view to buying a bigger house - but with the market stagnant and saving 20k+ a year there has been no rush).

Tancred

Excited13 wrote: »

In January this year it was easy to find a 4 bed detached for under £200k but now if you find one it isn't in a good area and the 4 beds are closer to the £250k mark.

Where do you live?? Oop nooth?

Come down to the Royal County and you won't find a decent 4 bed detached for less than £350k.

m0t

We have been looking to buy a house in SE London for a year and my unscientific observations are that prices are going up but availability is going down.

We now hardly see any new properties appearing on the market so there is huge competition for anything thats available which keeps the prices high.

ndf9876

m0t wrote: »

We have been looking to buy a house in SE London for a year and my unscientific observations are that prices are going up but availability is going down.

We now hardly see any new properties appearing on the market so there is huge competition for anything thats available which keeps the prices high.

Also seeing this behaviour in Surrey. in our price bracket (£230-£250k) it's like sharks around blood when a 2-bed Victorian semi comes on. We went to an open day viewing and were 18th on the list....

Houses that I personally feel are worth around £230k are regularly going for £250k; one place we looked at and offered the asking price went at least £5k above asking....it was nice but nothing special....!

The figures may say one thing, and I am no expert, but certainly in the areas I'm looking, things are just going mad.

m0t

One thing that is interesting is that there are a lot of houses unsold in rubbish areas. The prices have been pushed into a bracket where the only people that can afford them wouldn't want to live there.

ukcarper

Ulfar wrote: »

Lending multiples are much higher than they were say 10 years or more ago.

If you have a mortgage imagine what would happen if your interest rate went up by 2 to 5%. For a lot of people this would be a disaster.

Now combine that with the universal credit replacing tax credits. This on top of inflation in prices squeezing incomes. Also any new graduates are going to have a massive millstone of student debt in the coming years.

It is creating the conditions for a perfect storm when it comes to the economy and household expenditure.

Are you really telling me lending affordability criteria are laxer now than during the boom.

HAMISH_MCTAVISH

m0t wrote: »

We now hardly see any new properties appearing on the market so there is huge competition for anything thats available which keeps the prices high.

Supply and demand in action.

Road_Hog

m0t wrote: »

We have been looking to buy a house in SE London for a year and my unscientific observations are that prices are going up but availability is going down.

We now hardly see any new properties appearing on the market so there is huge competition for anything thats available which keeps the prices high.

Yep, I've just sold a house in London. The three estate agents all valued the house at £210K, the instructed agent did an open day a week later and I got the asking price (as long as it goes through okay). I'd been keeping an eye on the situation prior to selling and all the houses (lots of identical terraced houses in the area) that come up for sale have SSTC on Rightmove about a week after first appearing.

Turnbull2000

brit1234 wrote: »

Clearly not sustainable when people are stretching themselves with interest rates are 0.5%, QE, funding for lending an Help to buy. Wages are technically falling with high inflation and no pay rises, this is going to burn a lot of people who buy now.

We're simply going through an adjustment in line with long-term interest rate expectations. In 2002-2007, prices adjusted upwards to mortgage rates of 5-6% with duel income borrowing as standard.

With interest rates set to be suppressed until at least 2020 and state back mortgages likely to become entrenched into the market, we're now heading into an adjustment for 3% mortgage rates and higher multiples on the back of taxpayer guarantees.

So using the standardised 'affordability' criteria, you can now borrow £245,000 for the same monthly outlay as £200,000 back in 2007.

Prices are based on ability to borrow. And you can now borrow cheaper than ever before. Hence prices will adjust upwards. It's just common sense.

m0t

HAMISH_MCTAVISH wrote: »

Supply and demand in action.

Exactly. I am confused though - why has supply suddenly fallen off a cliff edge?