"Housing Market Slumps"

yertiz_2

I'm surprised no one has picked up on this today. It's been all over the BBC news this morning as well. Headlined in The Times. Any comments?
http://www.independent.co.uk/news/uk/home-news/housing-market-slump-ten-months-for-sale-brexit-house-prices-a7587076.html

westernpromise

Well, I'd agree with the last two of these

It is thought that speculation surrounding Brexit, years of increasing property prices, stringent mortgage rules and stamp duty rises are behind the stagnation.

but given that the article goes on to say that "in Sunderland...properties listed for sale are on the market for an average of 292.2 days", and there haven't been any "years of increasing property prices" in Sunderland, I don't see how that one applies.

You could refurbish the entire house I live in from top to bottom, including new kitchen and bathrooms, for the same cost as just the stamp duty on a house of similar value. In London at least, look no further for the causes of transaction volumes falling.

michaels

I wonder if the stamp duty rises are demonstrating the laffer curve - above a certain point higher tax rates actually reduce tax take.

Properties are still selling locally.

GreatApe

Property has always been a low transaction asset. Even pre recession weren't transactions in the region of 1.5m minus 200k new builds to give 1.3m transactions out of a stock of some 22m non social properties.

roughy speaking the average private house used to changes hands once every 17 years its probably closer to once every 22 years now. Part of this will be taxes and other policy changes over the years but aso simply people living longer thus staying in their last home longer.

The idea of people moving up some multiple atwp ladder is and probably has always been largely false. The stats suggest the average person only buys two homes in their adult life. If you like once when they are 30 and again at 50 and they then die at 80. And even then many of these people will be side stepping not moving up a 'ladder'


Personally I think the owner market should be far more liquid and the stamp duty should return to the norm that was 1% for most properties and maybe 2% for properties over £1m

Thrugelmir

In a close proximity here. No particular indications of a slow down. Much of the property coming onto the market is either refurbished or extended which helps. Though given prices somewhat are cheaper than new builds in neighbouring areas and with highly rated ofsted schools. The attractions are obvious. There's never going to be a one sized fits all. All might change if one of the large local employers were to make sizable reductions in headcount of course.

westernpromise

Going back to the OP, probably the reason "no one has picked up on this " here is that nobody here is all that interested in short-term price movements. On a 20 to 50 year horizon, who cares that it takes 11 months instead of 10 to sell a house?

davomcdave

michaels wrote: »

I wonder if the stamp duty rises are demonstrating the laffer curve - above a certain point higher tax rates actually reduce tax take.

Properties are still selling locally.

There must come a tax point where extending is cheaper than moving, especially after the previous government made extending easier to get planning permission for in 2013.

westernpromise

In London we're already there.

lisyloo

davomcdave wrote: »

There must come a tax point where extending is cheaper than moving, especially after the previous government made extending easier to get planning permission for in 2013.

That assumes you gave the room to extend.
If you live in a block of flats you don't have that option.

Windofchange

I don't think the press know what they want to report with housing in all honesty. House prices rise at quickest rate in history one day and then next day it is a slump. Just adds weight to my theory that nobody knows what is going on.

As to saying that nobody cares about short term movements in the housing market I would say a large number of people do. If you had a crystal ball that said in 5 years time your house has doubled in value you'd pile in hey. If that same crystal ball showed a 50% crash I reckon you'd hold off. Buying at the (In my humble opinion) peak of the biggest housing bubble in history could have some pretty dire consequences for you in years to come when you want to upgrade your studio flat for somewhere to raise a young family.

padington

There is a slump in sales, sellers are not selling but no price crash apart from central London because of the new taxes.

Don't confuse sales slump with house price crash. Prices are still going up outside central London.