Would you buy a house in London today?

lisyloo

I have heard anecdotally that surveyors are starting to come in with lower figures.

AndyGuil

lisyloo wrote: »

I have heard anecdotally that surveyors are starting to come in with lower figures.

Last month London properties were up 4% this means surveyors will be valuing higher.

lisyloo

Last month London properties were up 4% this means surveyors will be valuing higher.

I don't think the ones being valued right now for mortgages will show up in the figures for last month.
But time will tell.

Do you think 4% is sustainable?
How does this work if 97% are being bought by ordinary people and wages rises about 1.7% annually?

I think there is a lot of fear and desperation to get on the ladder.

AndyGuil

lisyloo wrote: »

I don't think the ones being valued right now for mortgages will show up in the figures for last month.
But time will tell.

Do you think 4% is sustainable?
How does this work if 97% are being bought by ordinary people and wages rises about 1.7% annually?

I think there is a lot of fear and desperation to get on the ladder.

Due to the change in lending rules the months before that were not strong so this would explain why it is higher this month as the extra checks on the mortgages have had their effect now.

Generally Londom workers earn considerably more and have had good pay rises.

padington

There is a gaping casm between what zoopla is claiming things are worth in London and what things are actually selling for, anyone noticed ? Near me zoopla is saying 350k when they are all going for 450k. Weird.

lisyloo

Generally Londom workers earn considerably more and have had good pay rises.

Oh come on Andy, London house prices are up 17%.
You've discounted foreign buyers and wages are not rising at 17% so surely you can't believe that's sustainable.

AndyGuil

lisyloo wrote: »

Oh come on Andy, London house prices are up 17%.
You've discounted foreign buyers and wages are not rising at 17% so surely you can't believe that's sustainable.

Why do you think that buyers are currently maxed out with what they can afford? Clearly they are not. England has 12 buyers for every property on average, London has 25. The earnings are also leveraged, so a 4% increase in salary results in 16% more affordability for a property. There are also a significant amount of cash buyers.

padington

AndyGuil wrote: »

Why do you think that buyers are currently maxed out with what they can afford? Clearly they are not. England has 12 buyers for every property on average, London has 25. The earnings are also leveraged, so a 4% increase in salary results in 16% more affordability for a property. There are also a significant amount of cash buyers.

Also it's the equity in other properties getting released that keeps the merry go round going. A friend of mine got divorced recently, re-mortgaged his house and gave his ex wife a 300k golden good bye. One day she will re-mortgage and give her kids a lump each to buy their house.

It's a bit like Jenga, there might come a time when all the blocks have been pulled and someone trying to pull the wrong one might bring it all down but as long as prices together with peoples's equities keep going up, fresh Jenga pieces appear below.

With 17% increases that's 17% more untouched Jenga foundation built underneath. But if you're not on the Jenga gravy train, you never get new blocks for free and the game looks entirely unaffordable so you want to play the next game and hope this one all falls down.

Problem is it's a state backed game, so the people that don't play are actually risking future earnings in the game, even though they don't benefit. So not playing the game is even more dangerous than playing it.

TickersPlaysPop

AndyGuil wrote: »

Only 3% of the property in London is foreign owned. Foreign purchases now are not any higher than they have been. The issue is simply alot of people wanting to live in an area with a limited number of properties available. London weathered the credit crunch, its fundamentals are better than most places, certainly better than anywhere else in th UK.

This is data from Knight Frank:

"Figures compiled by the global real estate consultancy Knight Frank show that for the two years to June 2013, 69% of new-build buyers in the prime central London market were not British.

Almost half, 49%, were not resident in the UK - thus raising the fear that homes have been bought purely as an investment and may be left empty."

This is data for central London and also not up to date data, its likely this is higher since June 2013 considering the increases in price in the past 10 mths.

Please always quote exactly what London you are referring to when posting data.... inner/ central or greater London.

http://www.bbc.co.uk/news/business-26980299

AndyGuil

TickersPlaysPop wrote: »

This is data from Knight Frank:

"Figures compiled by the global real estate consultancy Knight Frank show that for the two years to June 2013, 69% of new-build buyers in the prime central London market were not British.

Almost half, 49%, were not resident in the UK - thus raising the fear that homes have been bought purely as an investment and may be left empty."

This is data for central London and also not up to date data, its likely this is higher since June 2013 considering the increases in price in the past 10 mths.

Please always quote exactly what London you are referring to when posting data.... inner/ central or greater London.

http://www.bbc.co.uk/news/business-26980299

Prime central is mostly business premises and very little residential. London as a whole is moving together strongly, Brent an outer borough currently tops the gains in London. London as a whole is almost entirely domestic. What happens in prime central is a tiny proportion of all of properties.