Is it too late to sell a house in Northern Ireland???

doire_2

championmongo1 wrote: »

I have seen elsewhere that wages would need to inflate to £50k a year here for prices to regain their 'peak' value, and this will not happen in 20 years, which I don't agree with as the average couple currently earning two average wages of £21k or whatever it is, giving a joint income of £42k, even with a fairly low mortgage multiplier of 3.5X, giving them access to borrow approx. £150k + their deposit NOW. A higher multiple of 5X is still available if you have decent deposit, meaning that the average couple could afford £210k+.

As with regards wage inflation, I can't find an average annual wage chart, maybe someone could? However in 1970 for a full-time position in a UK solicitor's office you could expect to pick up £126 gross per month which would equate to £1512 a year.

http://www.bbc.co.uk/dna/h2g2/A319619

If we take that as an indication of the average wage, it has increased over 13 fold in 38 years, so might it not be possible for the average wage to double in 20 years???

Also purely taking average wage versus average house price is a fools game as it doesn't take into account investors in the market-there has always been private landlords! There are the couples who buy together as stated above, people with sizeable deposits, etc! Nor does it take into account the fact those on very low wages have never been involved in buying houses so why would we expect that to change now!?! For those reasons I believe house prices will always be above the standard average wage multiplier! Last quarter seen drops, I think this quarter will too, with prices beginning to stabilize by Q3 and the prices to have completely stabilzed by Q4 as those desperate to sell will have sold!

You seem to think that all FTBs' have a combined wage of 42k.

Thats not the case in the North of Ireland

Most FTB's are simply forced out of buying

championmongo1

Well my house had been sale agreed for a while but has fallen through at this late stage as the buyer was unable to secure the appropriate finances. It is now back on the market £45k below the original asking price (representing a 28% drop since September!). So I guess I can answer my own question that it is indeed too late to sell a house in our wee country!

Good luck to all OO's out there needing to sell!

IvanOpinion

There is a massive housing stock available at the minute and for the first time in umpteen years the yer-on-year inflation has gone negative this month. It is a strange situation ... a massive number of houses for sale but nobody buying .. where do all those that have their house for sale expect to go? Some will be looking to rent 9Posibly in the hope of buying later) but others will be looking to buy another house .. they are not placing bids because nobody is bidding on their own ... vicious circle.

Obvious advice is that if you do not need to sell today then don't .. if you do need to sell then you have to accept it is a buyers market. The market will come back (probably a lot quicker than the doom mongers have been predicting a fall )

Ivan

tara747

championmongo1 wrote: »

With regards you saying that wage inflation will stay very low, the following article showing that wage inflation is currently holding at 3.5%, which looks pretty average.

http://news.bbc.co.uk/1/hi/business/7282710.stm

Even so, this means that a person earning say £21k now would be on £25k in five years, £31k in ten, £45k in twenty etc, etc. This could be slightly out depending on exactly what inflation does but does give a rough idea of what we can expect based on average wage inflation!

Looking at David Varney's report on public sector wages being too high, expect pay freezes shortly! I wouldn't be banking on wage increases every year, and of course even those who do get a rise are seeing it eaten up by inflation.

tara747

Good luck to all current sellers, keep us posted.

CM, sorry to hear about your sale falling through.

leftieM

That's a bummer CM. The market is so hostile. We're paying a huge price for the boom. How did anyone ever think it was a good thing? All it did was suck people into debt.

IvanOpinion

leftieM wrote: »

That's a bummer CM. The market is so hostile. We're paying a huge price for the boom. How did anyone ever think it was a good thing? All it did was suck people into debt.

It all depends on how you look at it ... half-empty or half full ... many, including myself, look forward to profiting from this. Very few people bave to pay a price, it all depends on how depserate they are to sell, if they can hold off then they are better to sit and wait this out, prices will come back but it may take a couple of years .. if they over stretched themselves in the first place then they only have themselves to blame (after all this crash has been predicted for at least 5-6 years:rolleyes: )

Ivan

talksalot81

IvanOpinion wrote: »

It all depends on how you look at it ... half-empty or half full ... many, including myself, look forward to profiting from this. Very few people bave to pay a price, it all depends on how depserate they are to sell, if they can hold off then they are better to sit and wait this out, prices will come back but it may take a couple of years .. if they over stretched themselves in the first place then they only have themselves to blame (after all this crash has been predicted for at least 5-6 years:rolleyes: )

Ivan

I am surprised by your comments because anecdotal and media evidence suggests that there are a great many people who, through increasing mortgage costs and our inflationary problems, are awfully close to being unable to keep up the payments... if the economic situation does not improve soon, this is likely to get worse and worse as all the good fixed price deals come to an end and people in negative equity are unable to get another one!!

IvanOpinion

talksalot81 wrote: »

I am surprised by your comments because anecdotal and media evidence suggests that there are a great many people who, through increasing mortgage costs and our inflationary problems, are awfully close to being unable to keep up the payments... if the economic situation does not improve soon, this is likely to get worse and worse as all the good fixed price deals come to an end and people in negative equity are unable to get another one!!

But your definition of 'worse' is my definition of 'opportunity'. If people go into or are in negative equity then selling is not necessarily the best decision, prices will come back but they need to 'survive' the current downturn. That may mean a lot of tightening of the belts and maybe some renegotiation with the bank .. possibly deferring part of their mortgage (normally I would call that a bad choice but each person needs to look at their own financial situation and determine what is best).

In some cases 'selling' may be the only choice and in this market that is bad news for them but could be good news for somebody else. However many people do not understand the concept of tightening their belts and consider the likes of Sky, mobile phones, holidays and meals/nights out as necessities ... a year or so of hardship and 'making do' is better than several years of repaying debt on something you no longer own.

ivan

Colin_Kee

In reading through a lot of these comments I've come to the conclusion that people in UK/Ireland have some mad dillusion that they have some God given right to own their house. If you're on a low income or cant meet the 3.5 x Salary figure, rent.. Why do people in UK/Ireland see property as a way of making money.. IT'S A ROOF OVER YOUR HEAD. OK if you can afford it, yes it is a way of making money but everyone, and I mean everyone has tried to jump on the bandwagon.. This whole situation we find ourselves in now is, at the end of the day, something we've brought on ourselves.. People were paying rediculous amounts of money for houses that were way over priced. To be honest I do feel some sympathy for those fining themselves in financial dificulty now but in another way I think, why should I, they made the decision to buy the house, you have to live with your decisions and suffer the consequences if they are wrong. THATS LIFE!!

And no I'm not being Heartless, I've had a house sale fall through also and have had to dramatically reduce the price to get another offer.. You have to live with it.. markets rise and fall...

Untill people start seeing houses as somewhere to live and not some sort of money spinner, this problem will never sort itself out... well thats my thoughts anyway..