MSE News: House prices rising faster, Halifax says

Former_MSE_Helen

"House prices are 5.4% higher than this time last year with the average house price reaching £170,231, says Halifax..."

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House prices rising faster, Halifax says



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HAMISH_MCTAVISH

Prices rising, more people able to buy, and a supply response starting to kick in as well.

Excellent news all around.

:beer:

Fraise

I read that next year they're going to rise even more. That is good for many people, especially those who recently bought and want to make some equity, but possibly not so good for those trying to get on the ladder.

There's some winners and some losers I suppose. Have to say that history shows it's good to get on the ladder as soon as you can, otherwise it is very hard to get on that first rung.

pops5588

It sounds like we got on it just in time!

christopher1977

yep it's great the Govt are inflating the bubble again:T

can't afford a deposit - no worries we will bung you 15%:mad:

and the worse part of it is my wife is making me buy her a house - guaranteed the IR's will increase and the bubble will pop the day i get the keys:D

Pincher

There is always a bottom group of people who cannot afford to buy a house. This is why we should make inflatable houses like bouncy castles. You rent a plot like a trailer park, with easily connected amenity. When you need to move for job reasons or whatever, you find another site, and deflate and re-inflate at the new site. For DIY you just need a bicycle puncture repair kit.

Brummygold

As a potential first time buyer and a member of a site where its members like to save money i do not see this as good news. Rising house prices do not benefit joe public. This is good news if you are a banker, property investor, and the like.

harrys_dad

HAMISH_MCTAVISH wrote: »

Prices rising, more people able to buy, and a supply response starting to kick in as well.

Excellent news all around.

:beer:

You have to be kidding, especially about the "supply response". Developers (most of whom contribute to Conservative Party funds) are sitting on over 440000 agreed planning permissions for houses yet to be built. Current build levels are the lowest for decades, and barely half what is needed to stand still. Builders do not build much quicker, because rising house prices mean land on their books becomes more valuable, so profits (and executive pay) go up without actually doing anything.

This is an artificial bubble, inflated by Government money, to help their friends make profits and to try to generate a "feel good factor" ready for election time in 2015 before it all goes pop again.

The simplistic analysis that says "rising house prices good falling house prices bad" has no relation to reality for most of the population. The only people that gain are those who are "downsizing" , those who are inheriting an extra house from a dead relative, and Buy to Let landlords. Rising prices makes it more difficult to buy your first house, or to trade up, which is what most people do. it also puts rents up.

I speak as a house owner with no mortgage, so stand to gain by the price of my main asset increasing (or at least my children will when I die, which may not be long given what this is doing to my blood pressure). Unlike some, I still have a concern for others, including my grandchildren, who are facing a future of significant housing uncertainty.

HAMISH_MCTAVISH

harrys_dad wrote: »

This is an artificial bubble, inflated by Government money,

No, just the opposite.

This is the BOE and Govt doing their job to restore at least partial functionality to a mortgage market that has been completely dysfunctional since the global credit crunch hit, and not before time.

In my opinion the current artificial repressing of house prices through mortgage rationing is starting to end, and the lowest house building in a century is about to meet the biggest generational bulge of FTB age people in history.

Soaring population and the existing million house shortage will certainly mean prices continue to rise, a situation worsened dramatically by the last 5 years of mortgage rationing causing house building to fall to the lowest levels in a century, and the next boom will likely be the biggest ever as a result.

Leading to the likeliest outcome by far being a near doubling in house prices in real terms over the next cycle, as the mortgage market and wider economy recover, and millions of ftb age people run into the worst housing shortage in history....



Of course, other opinions may vary.....

But they've mostly been wrong so far

harrys_dad wrote: »

The simplistic analysis that says "rising house prices good falling house prices bad" has no relation to reality for most of the population. The only people that gain are those who are "downsizing" , those who are inheriting an extra house from a dead relative, and Buy to Let landlords. .

Rising house prices are good for......

-The millions of people who are in or approaching retirement, and who either plan to, or may unexpectedly need to, downsize.

-The millions more people who are in their final property now, but will find themselves in the position above at some point.

-The couple of million people who bought within the last 7 years, who may be in or close to negative equity.

-The owners of the 2 million investment properties.

-The millions of people who may need to re-mortgage as and when rates climb, and want the best possible LTV ratio to get the best rates.

-House builders, construction industry, suppliers, investors, pension funds holding mortgage securities, banks, and all housing related industries, all of their shareholders and employees, whether they own a house or not.

-The family members of anyone who will leave an inheritance, or release equity to help their kids onto the ladder when downsizing, etc.


Rising house prices are bad for......

-A few hundred thousand potential FTB's at any given time...... But only until they get on the ladder, and become one of the groups above.

And as for upsizers......

It used to be commonly believed that falling prices were better for them.

However this crash has proved that to be wrong, in most cases, because the price of their FTB property has fallen by far more than the price of the 2TB properties.

So the gap between rungs on the ladder has widened, not narrowed, with falling prices.

In summary....

Rising prices are better by far for the vast majority of society, and falling prices only benefit a few, and then only temporarily.

christopher1977

There are two identical houses.

One is 150k and one is 200k.

Which would you buy Hamish and why?

HAMISH_MCTAVISH

christopher1977 wrote: »

There are two identical houses.

One is 150k and one is 200k.

Which would you buy Hamish and why?

I will absolutely, always, negotiate the cheapest price I can on anything I buy.

I will also absolutely, always, negotiate the most expensive price I can on anything I sell.

The market price is set at that point where both buyers AND sellers agree to transact.

But in general terms, rising asset markets are good for society and the economy, and I certainly won't walk away from a deal to buy something at market prices just because they're higher than they used to be.