Why is nobody selling?

ukcarper

audigex wrote: »

There are still houses available, particularly in the North, but nervousness over the election is making some people pause.

Mostly, though, I think it's down to stagnation: as someone mentioned, people are "maxing out" on what they can afford, before they ever get a chance to upgrade and jump up a step on the ladder.

The fact is that if you buy a house now, in 10 years you'll likely pay off 30% of your equity (including your current deposit). Now let's assume the house you'd like to upgrade to costs (currently) 150% of your current house value.

Add in approximate house price growth of 15% over 5 years predicted nationwide between now and 2020, and carry that on for another 5 years, and that upgrade now costs (after 10 years) almost exactly 200% of your current property's price

So now your 30% of the equity in your current home will just about cover 15% of your target home. But unless your wages have doubled in 10 years, you can't afford the mortgage: and an "average" person should expect their wages to grow ~30% in the next 10 years (2.5% compound).

You can quickly see, then, how people just simply can't afford to move, so they stay put or move sideways with the equity they have, but why do that unless you need to move?

That has always been the case, although your figures are a bit over the top. You would have about 40% equity after 10 years if you put down a 10% deposit and most people down upgrade to a house cost 50% more than their current property.

The difference is that wages have increased very little over the last 7 years and most people don't have the confidence that things are going to change that much.

poggs

Nah. The problem is nimbyism.

We need to build lots more houses. but only where people want to live.

the problem with that is whenever a builder tries, everyone objects and nothing gets built.

Up here in east lothian, there is a disused mine that has planning permission for 15,000 houses. It been available to build on for 10 years with no company interested as its in the middle of no where.

There are however two nearby villages, longniddry and gladsmuir where builders are desperate to build on. Planning permission is repeatedly sought and denied following massive complaints and campaigns from the locals who want to keep the quant areas for themselves.

Thus no houses get built.

We need to change planning laws to force through new builds. especially in those south east green belt areas. THose prices are too high due to lack of supply.

audigex

Yeah I'm sorry, but nobody has a right to not live near other people.

Just because you got there first, doesn't give you a right to a field next to you. The ultimate NIMBY-ist protectionism.

That said, developers also need to understand that they can't just cherry pick the nicest areas where they can build expensive detached cottages

Running_Horse

Is this why nobody is selling.

http://www.bbc.co.uk/news/business-32721408

We abandoned plans to free up our house by selling and moving because of the sheer hassle and expense.

How can the system be made easier and simpler?

jacko74

Well the election has been and gone and I'm still not seeing an increase in numbers of houses coming on to the market, in fact I'm getting more Rightmove alerts for 'reduced properties' than I'm getting for 'new properties'

There also seems to be a lot of sales falling through at the moment, seeing lots of properties that were sstc coming back on to the market.

hpifever

Exactly what I am seeing!

missyrichards

I'm seeing a definite price rise in the new properties coming onto the market, even in the last week since the election. Everything seems to be more expensive. I wonder if it was that people were waiting for the election result to put their house on the market or that estate agents have valued their properties for more now there is a stable government?

Prices are rising where I'm living now and also where I'm looking to buy later this year so hopefully we should break even!

lukeh23

Not a majority, but i guess a sizable amount of people would been waiting until after the election.

lisyloo

Missyrichards are you saying asking prices are rising?
That doesn't mean much.
I'll sell you my 1998 Cora for £1,000,000

Selling prices are what counts. They are still rising but the rate is slowing.

missyrichards

lisyloo wrote: »

Missyrichards are you saying asking prices are rising?
That doesn't mean much.
I'll sell you my 1998 Cora for £1,000,000

Selling prices are what counts. They are still rising but the rate is slowing.

True, but I was surprised that they have increased asking prices in such a short time, my neighbour just sold his house before the election and I wonder if he is regretting that now. We live near to what will be a Crossrail station so I thought that might be another reason.