When will the correction come to house prices?

AndyGuil

mobfant wrote: »

Have you got graphs for the data in that article for the past few years? I couldn't see what source the data came from.

Combine this information of month on month falls with the rightmove asking price reductions (not linked to MMR) and RICS data last week, and there are signs the market is calming, and it is about more than MMR.

But you're right in that it'll take more than a month or two of data to conclude that there is a substantive change and that this is more than a blip.

I think coinciding MMR with the normal peak in supply that occurs until July it is obvious why there is an impact, although this year it is less than previous years.

Asking prices for the last two years:
July 2012 -3.6% http://www.rightmove.co.uk/news/articles/property-news/average-asking-prices-in-london-drop-by-over-17000
July 2013 -2.0% http://www.propertyreporter.co.uk/view.asp?ID=12051

mobfant

AndyGuil wrote: »

I think coinciding MMR with the normal peak in supply that occurs until July it is obvious why there is an impact, although this year it is less than previous years.

Asking prices for the last two years:
July 2012 -3.6% http://www.rightmove.co.uk/news/articles/property-news/average-asking-prices-in-london-drop-by-over-17000
July 2013 -2.0% http://www.propertyreporter.co.uk/view.asp?ID=12051

Interesting - looking at flats, prices did go down last May, though didn't the May before.

http://landregistry.data.gov.uk/app/hpi/view?from_m=3&from_y=2011&loc_0=Greater+London&loc_uri_0=http%3A%2F%2Flandregistry.data.gov.uk%2Fid%2Fregion%2Fgreater-london&m_apf=f&m_chm=1&m_hpi=1&source=preview_form&to_m=5&to_y=2014

Istencsapasa

As soon as we vote in UKIP. If they do succeed in getting non-nationals to leave then there will be a small but significant decrease in demand for housing. Much of this demand is in the rental sector which will mean that private landlords will take a hit on rent levels. If this coincides with a rise in interest rates (which it will) then buy-to-let will become a lot less attractive. The significance is that unlike most homeowners who are fairly static in their house buying habits - i.e. buy one house and live in it, landlords can quickly off load several properties if the yields tumble. This may be a good or bad thing depending on your views but it does look as though there will be a (comparative) squeeze on property prices from both the supply and demand side. Be careful going into property just now.

AndyGuil

I would be surprised if UKIP win a single seat...

cells

Istencsapasa wrote: »

As soon as we vote in UKIP. If they do succeed in getting non-nationals to leave then there will be a small but significant decrease in demand for housing. Much of this demand is in the rental sector which will mean that private landlords will take a hit on rent levels. If this coincides with a rise in interest rates (which it will) then buy-to-let will become a lot less attractive. The significance is that unlike most homeowners who are fairly static in their house buying habits - i.e. buy one house and live in it, landlords can quickly off load several properties if the yields tumble. This may be a good or bad thing depending on your views but it does look as though there will be a (comparative) squeeze on property prices from both the supply and demand side. Be careful going into property just now.

Great theory only problem is that demand for ADDITIONAL housing is there for the existing population without immihration adding fuel to the fire

an example is in our own past. For 4 years in the 1970s the ul population very slightly shrank. Durong those same 4 years se 1.2 million additional homes were built. Rents did not crash nor did prices. The demand to live less dense was there and it meant the existing population moved into those homes

The same is true now. People want and need to live less dense. That means demand is there and strong even at zero population growth

Thrugelmir

AndyGuil wrote: »

I am curious as to how any conclusion can be drawn when this has happened for at least the last few years around this time of the year in London. Never mind it is just one data set compared to a whole years worth available.

Mortgage approvals have fallen for past 3 months that's a fact.

AndyGuil

Thrugelmir wrote: »

Mortgage approvals have fallen for past 3 months that's a fact.

That's MMR though causing a delay.

Pincher

Just had a cash offer circa £800k. I wasn't even trying to sell.


I think this MMR thing is only relevant to people in the £50k income bracket, buying flats for £200k or so.


At £800k, 3.5 times is a joke.

Jason74

AndyGuil wrote: »

That's MMR though causing a delay.

That's a factor for sure. But looking at my local market at least, there seems to have been a price ceiling hit. Anything priced under the "ceiling price" for the type of house and location is selling fairly quickly. Anything priced over that is sticking, wheras until recently the market was just sucking up the increases.

Prices have moved so far so fast (probably up 50% in 15 Months or so) in my area that the market simply seems to be saying "no" to any further increases for now. I don't think we'll see a massive fall back of prices, but I don't think we'll see too much of an increase in the next 6-12 Months either. Something in my particular local market has definitely shifted, and it's not just about MMR.

Thrugelmir

AndyGuil wrote: »

That's MMR though causing a delay.

MMR is making life more difficult for a considerable number of borrowers. As the onus is firmly on the lenders. Therefore underwriting criteria has been tightened. In another 6 months a clearer picture will emerge.