Is property in a bubble?

apollo9

Getting divorced and would like to stay in the area. I guess its just a difficult pill to swallow as I am not really gaining from the same amount of capital gain (long story).


And thank you for reminding me about the letting versus buying.

Thrugelmir

lisyloo wrote: »

If you are waiting for them to die-out you might be waiting a long time as some people own in their 40s.

The post war baby boom is heading towards it's peak. Will be a fair number looking to downsize.

GreatApe

Thrugelmir wrote: »

The post war baby boom is heading towards it's peak. Will be a fair number looking to downsize.

Few people downsize
And those that do typically only very late say age 75-80 so they've only downsized for 5-10 years.

phillw

Thrugelmir wrote: »

The post war baby boom is heading towards it's peak. Will be a fair number looking to downsize.

Downsizing is becoming less popular, because you're stuck in a much smaller house and quickly fritter whatever profit you made away.

GreatApe

Is UK property I'm a bubble?

A three bedroom Victorian terrace in Birmingham can be had for £120,000 which is probably below build cost

The same house cost build cost back 110 years ago when it was built (and didn't have proper electricity or plumbing or double glazing back then)

So why are people asking if property is in a bubble when prices are the same as they were 110 years ago?

ukcarper

phillw wrote: »

Downsizing is becoming less popular, because you're stuck in a much smaller house and quickly fritter whatever profit you made away.

The problem with downsizing is lack of suitable properties, I would like a smaller house but most flats have no outside storage, modern 2 bed terraces are unappealing and also lack storage and bungalows are expensive. Retirement properties like McCarthy Stone will not appeal to many people it their 60s.

enthusiasticsaver

In some areas property prices are completely disproportionate to average income like London and the South East. Other areas are undervalued like the Midlands, Wales and the North East or some parts of it. That was the case 30 years ago though when we moved out of London to the South West.

Our 4 bed modern detached house cost us around £90k in 1988 and is now worth around £270k in Cornwall so has tripled in 30 years. My brother bought his 2 bed terraced house in Surrey in 2003 for £120k and 15 years later it is worth £360k so his has tripled in half the time due to where he lives. I daresay there are properties up North which are worth less than they were in 2004.

westernpromise

enthusiasticsaver wrote: »

In some areas property prices are completely disproportionate to average income like London and the South East.

These prices aren't a function of average local income. They're determined by international incomes because London is an international city. Property prices in London, New York, Hong Kong, and Singapore are all much of a muchness.

If London prices weren't affordable to those who live there they'd fall.

Our 4 bed modern detached house cost us around £90k in 1988 and is now worth around £270k in Cornwall so has tripled in 30 years.

So that's 3.7% annual inflation over 30 years. Seems reasonable.

ukcarper

westernpromise wrote: »

These prices aren't a function of average local income. They're determined by international incomes because London is an international city. Property prices in London, New York, Hong Kong, and Singapore are all much of a muchness.

If London prices weren't affordable to those who live there they'd fall.



So that's 3.7% annual inflation over 30 years. Seems reasonable.

That’s not the complete picture as the median income in London wouldnt buy you a house. The amount of property available also makes a difference.

westernpromise

Who says that all houses in London are bought out of income?