London Has Peaked

Bubble_and_Squeak

wotsthat wrote: »

5 months of rent and prices are no lower.

Of course 20 weekends ago was when you hit the big bear reset button. You're a year in in reality so a years rent and prices are quite a ways up.

asking prices are lower
and there is more choice

padington

Bubble_and_Squeak wrote: »

asking prices are lower
and there is more choice

You know it's a bull market when the bears want to buy.

Jason74

AndyGuil wrote: »

I think supply is dropping off again. I have had three notes through my letter box this week asking if I would like to sell my property.

I think that's unlikely, unless you're in one of a very small number of hotspots. Certainly in my part of the London, supply is continuing to edge up and is now close to double the lowest point early this year. Still very little selling, and the last two weeks has seen quite an aggressive round of price cutting. And this in mid September, which finally kills off for good the idea that the change in the market was just a seasonal thing. If anything, the end of the summer period has brought about extra supply, without the extra demand to match it.

Of course, those reductions may bring buyers back into the market, which could constrain supply after a while, but it's very much a buyers market in my area at the moment, albeit at prices much higher than a year ago. I'm actually thinking about taking the plunge for my next (and last) move at the moment, and agents are actually talking about vendors being willing to take a property off the market prior to ours being under offer if a good offer is made. That would have been unthinkable a few Months ago, and shows how much the market has changed. Of course that still leaves me the problem of selling into this market, but hopefully some competitive pricing should do the trick there. I'm more than happy for a ftb to geta relative bargain if it helps me get my "forever house" on my terms in the process

Bubble_and_Squeak

padington wrote: »

You know it's a bull market when the bears want to buy.

£150,000 of the asking price is over 20%
that would make walthamstow a bear market

http://www.rightmove.co.uk/property-for-sale/property-31241016.html

Bubble_and_Squeak

Jason74 wrote: »

I think that's unlikely, unless you're in one of a very small number of hotspots. Certainly in my part of the London, supply is continuing to edge up and is now close to double the lowest point early this year. Still very little selling, and the last two weeks has seen quite an aggressive round of price cutting. And this in mid September, which finally kills off for good the idea that the change in the market was just a seasonal thing. If anything, the end of the summer period has brought about extra supply, without the extra demand to match it.

Of course, those reductions may bring buyers back into the market, which could constrain supply after a while, but it's very much a buyers market in my area at the moment, albeit at prices much higher than a year ago. I'm actually thinking about taking the plunge for my next (and last) move at the moment, and agents are actually talking about vendors being willing to take a property off the market prior to ours being under offer if a good offer is made. That would have been unthinkable a few Months ago, and shows how much the market has changed. Of course that still leaves me the problem of selling into this market, but hopefully some competitive pricing should do the trick there. I'm more than happy for a ftb to geta relative bargain if it helps me get my "forever house" on my terms in the process

i've noticed that the august figures on rightmove show supply dipped slightly in most london postcodes. i'm only keeping tabs on houses not under offer or stc and this number is still increasing in all of the postcodes i'm watching. not sure what to make of this. possibly people are attempting to buy but unable to proceed.
any thoughts?

ukcarper

Bubble_and_Squeak wrote: »

£150,000 of the asking price is over 20%
that would make walthamstow a bear market

http://www.rightmove.co.uk/property-for-sale/property-31241016.html

Blimey bubble that's almost 3x the house that sold in April 300% increase that's what you call HPI.

System

ukcarper wrote: »

Blimey bubble that's almost 3x the house that sold in April 300% increase that's what you call HPI.

I'm pretty gobsmacked that he still hasn't worked out this asking price stuff.

Bubble_and_Squeak

ukcarper wrote: »

Blimey bubble that's almost 3x the house that sold in April 300% increase that's what you call HPI.

the old bomad-hand-me-down-on-the-cheap trick no doubt

Jason74

padington wrote: »

I thought houses were ultimately determined by average wage ratio's? Oh well, that's the bears argument torn up.

Of course the most fashionable city in the world is determined partly by speculation. It's like the art market but even more buoyant across the board because of so much finance is available to play the field and because of a possible yield available.

That speculation creates a high demand which reduces the supply.

It's an unfair game, those sitting on the sidelines could end up never able to buy in London. Your best chance to stop this from becoming a reality is doing your location homework and buying a place you can afford with friends, fairly quickly.

It's possible you could sit things out and hope Labour change the game for first time buyers and hope for a dip. I doubt that's the best strategy for you though because of where in the cycle we are.

Generally I would agree with this, and certainly 12 months ago, this would have been great advice. But the situation today is imho impossible to call. The past 18 Months have seen prices rocket at an almost unheard of rate, and I'm convinced that a large part of that has been the market building up a momentum within itself that became self feeding. What is very clear now (and pretty much all credible sources are confirming this, and to be clear, Zoopla values are not a credible source), is that in most of London, that momentum has now burnt out.

That in itself has caused prices to stall (or even fall back a little) in many areas as the market corrects an overshoot, and most of the short term pressures on London prices appear downwards rather than upwards. Interest rates, the middle eastern situation, what is happening in Eastern Europe, issues in China. All of these factors could morph into something that influences house prices in London, and none of them are going to be an upwards influence. And that's before you even factor in the possible impact of a Scottish yes vote, or a change in government leading to a more progressive approach tp housing.

Now of course, taking a 10 or 20 year view, none of these factors matter much. You've eloquently made the case in a number of threads as to why London is likely to get more expensive over time, and it's hard to argue with that. But I think it's quite likely that we are in a "mini cycle" at the moment, and we could be close to the top of it. It's hard to tell of course, and I wouldn't want to be a potential London ftb right now.

But my own personal take on this (and I don't claim to know for sure, and would be suspicious of anyone who does), is that potential buyers probably have time to stop and think at the moment in a way that they haven't had for at least the past couple of years. The short term risks are more downside than upside right now imho, and while ftbs should be willing to compromise to get on the ladder, I think steps like buying with friends carry big risks given the bigger (short term) picture.

padington

Jason74 wrote: »

Generally I would agree with this, and certainly 12 months ago, this would have been great advice. But the situation today is imho impossible to call. The past 18 Months have seen prices rocket at an almost unheard of rate, and I'm convinced that a large part of that has been the market building up a momentum within itself that became self feeding. What is very clear now (and pretty much all credible sources are confirming this, and to be clear, Zoopla values are not a credible source), is that in most of London, that momentum has now burnt out.

That in itself has caused prices to stall (or even fall back a little) in many areas as the market corrects an overshoot, and most of the short term pressures on London prices appear downwards rather than upwards. Interest rates, the middle eastern situation, what is happening in Eastern Europe, issues in China. All of these factors could morph into something that influences house prices in London, and none of them are going to be an upwards influence. And that's before you even factor in the possible impact of a Scottish yes vote, or a change in government leading to a more progressive approach tp housing.

Now of course, taking a 10 or 20 year view, none of these factors matter much. You've eloquently made the case in a number of threads as to why London is likely to get more expensive over time, and it's hard to argue with that. But I think it's quite likely that we are in a "mini cycle" at the moment, and we could be close to the top of it. It's hard to tell of course, and I wouldn't want to be a potential London ftb right now.

But my own personal take on this (and I don't claim to know for sure, and would be suspicious of anyone who does), is that potential buyers probably have time to stop and think at the moment in a way that they haven't had for at least the past couple of years. The short term risks are more downside than upside right now imho, and while ftbs should be willing to compromise to get on the ladder, I think steps like buying with friends carry big risks given the bigger (short term) picture.

I'm only an arm chair pundit, so don't take my word for it but even this bull agree's all bets are off until the Scottish vote, that's a given.

After that, in my opinion, all bets back on until Xmas, after which we will see no more gains until labour do their housing policy reveal. I would imagine that reveal would mostly be a mansion tax ( possibly placing pressure on cheaper property) and a strong house building campaign which will affect prices in places like Kent but only a little bit in cycling distance to central London.

... At which time anyone who could have bought now in the capital somewhere they would be happy with, may well have missed the boat and risk rent servitude or a horrible commute from Kent.

I also think labour are going to want to build a large housing stock for the state, I expect many of the new builds to be fairly expensive social housing or a whole new subset of govenement owned land where houses are sold as a complete separate entity on a leasehold basis.