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Debate House Prices
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Mortgage Lending Rising Again
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Hmm, maybe not as much agreement as I thought then. For London, I'd put the shortage / speculation ratio at about 70 / 30. Not the primary factor for sure, but far from trivial. I think perhaps it's one of those thingds that you actually have to be in an area to see it happening.
Considering less than 3% of London property is foreign owned then perhaps it is much less speculative than you put it.0 -
Considering less than 3% of London property is foreign owned then perhaps it is much less speculative than you put it.
But that's not the relevant statistic. The mportant number is what portion of sales now are being made to foreign buyers. My understanding is that in Prime central London that figure is North of 40%. That then impacts on the rest of the city as a whole, so to suggest that there isn't a speculation issue because only 3%o. of property is foreign owned doesn't follow imho.0 -
I think perhaps it's one of those thingds that you actually have to be in an area to see it happening.
I guess it depends on your definition of speculator.
In my book, someone that buys only for capital gain and for no other reason = speculator.
Someone that buys to live in a house, or as a long term BTL = not a speculator.... even if they expect prices to rise... or are willing to pay more to get one of the few houses available before they're priced out, because they expect prices to rise.
That's not speculation... it's a rational response to a shortage.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
But that's not the relevant statistic. The mportant number is what portion of sales now are being made to foreign buyers. My understanding is that in Prime central London that figure is North of 40%. That then impacts on the rest of the city as a whole, so to suggest that there isn't a speculation issue because only 3%o. of property is foreign owned doesn't follow imho.
Prime London is an infinitesimal amount of the total sale in London. Further, they have no bearing on what a 2 bed flat in Clapham sells for.0 -
what portion of sales now are being made to foreign buyers.
I'd even go so far as to say foreign buyers sheltering wealth are not necessarily speculators.
A Russian Oligarch or Saudi Royal buying a penthouse flat or mansion is not necessarily speculating.....
If they're holding it for the long term as a hedge against keeping all their assets in a more volatile part of the World that's not really speculation?
Short term capital gain is not relevant to them.... Long term diversification of assets is what they're after.
And there's a pretty limited number of global business hubs with relatively stable global reserve currencies, and legal systems and democratic traditions as good as the UK's.
New York, London.... Maybe a handful of others. All competing for the wealth of the 12,000,000 millionaires in the World today.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
HAMISH_MCTAVISH wrote: »I guess it depends on your definition of speculator.
In my book, someone that buys only for capital gain and for no other reason = speculator.
Someone that buys to live in a house, or as a long term BTL = not a speculator.... even if they expect prices to rise... or are willing to pay more to get one of the few houses available before they're priced out, because they expect prices to rise.
That's not speculation... it's a rational response to a shortage.
London property occupation being extremely high, near 100% supports the speculation levels being low.0 -
If the price goes up as a house buyer, you win.
If the price stays the same, you win.
If the price goes down, after 25 years your family gets to be rent free in that home forever.
There is speculation in every market. London has a fair bit of speculation like every major city and I suspect it could 'enjoy' a fair bit more. On the other hand, if something goes majorly wrong, prices could crash.
But the bottom line is after buying a house for a year, you are guaranteed to own some equity of your home.
However If you don't, it's still possible you may never own any equity ever.
So be very careful which road you take. London is a roaring success at the moment. There is every reason to think it will enjoy this space for another 5 years.
Also there will be a bust after this boom, but we've only just had a bust and the boom has only just started to get going.
The safest way to play this, I think, even in London, is to secure what you can quickly and get 5 years equity under your belt then reconsider your position.Proudly voted remain. A global union of countries is the only way to commit global capital to the rule of law.0 -
London property occupation being extremely high, near 100% supports the speculation levels being low.
Good point.
Ireland in 2007 had a staggering 17% of properties sitting empty.
The USA had 11%...
The UK had less than 3%, around 1.5% as long term empty, and almost all of those were simply in the wrong place for current demand.
London today has just 0.71% of houses sitting as longterm empty according to the empty homes agency.
That doesn't sit well with the concept of "speculation" being any kind of significant factor in my opinion.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
I think what we need to do is build sh*t loads of state housing and offer the tenants the opportunity to own that home after 40 years of paying the rent ( and allow these tenants to sub let if they so wish) to allow a dynamic rental market place.
It will allow London to house the artists and musicians whilst also not killing the golden goose of a highly prized home turf property market.
It will also temper the current market, which it probably needs and will franchise many many more people to owning their own home eventually.
The rents simply costed at the cost to run the scheme but include in that a healthy premium for the loss of green land to the nation and that money to be funnelled back into buying islands for the nation, overseas.
Also I would prioritise social tenants who's occupations were essential to the health and prosperity of the city in order to balance the failure of the current market to reward nothing but capital.Proudly voted remain. A global union of countries is the only way to commit global capital to the rule of law.0 -
Asking lower than sold would only happen if there is an exceptional difference. This isn't happening.
http://www.rightmove.co.uk/property-for-sale/property-30952581.html
this was listed with a different agency for £500k
STC at £400k after several price cuts
last one sold for £470k0
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