Lunatic London Property market starting to turn?

Windofchange

GreatApe wrote: »

It is a new build development, whatever it sells for is its price.

Anyway a quick rightmove search shows the asking prices for 1 bedroom flats at £15,000 per sqm in battery power station development and £7.5k for the nearby council stock. For larger 3 bedroom flats the asking prices are closer to £10k/sqm for the development and £6k/sqm for the nearby council stock.

Is that what you call in free fall? £10-15k per square meter??

They can ask what they want - doesn't mean they are selling.

Don't remember saying that I think things are in freefall. I said that I think things will fall fast in the near future. This is near in property cycle terms of course, not next week or month.

What do you suppose will happen to those square metre valuations once interest rates creep up and the foreign investment stops? Reckon the local population will step in?

Windofchange

chucknorris wrote: »

It isn't just about house prices though, the economy is probably heading for tougher times, no one knows how Brexit is going to turn out. I think interest rates are going to have to be tweaked upwards soon due to inflation, but I really can't see interest rates being over 2.5% within the next 4 years, and it will also happen in small increments too.

IMO an increase to a 2.5% base rate is is not going to cause an increase to existing variable mortgage rates, there is already a healthy differential for mortgage lenders between the base rate/savings rates and variable mortgage rates. It will probably see the end of hugely discounted initial offers to mortgages (i.e. products heavily discounted for the first 2 years etc.), but that will not be a huge factor either.

But what could hit house prices is a bad Brexit (for the UK), leading to a recession. But a lot of people still don't seem to have learned yet, that it isn't easy for most of the population to buy a house during a recession, it just doesn't work that way.

Absolutely, there is an economy to manage, but our economy is about rampant debt - PCP cars, easy credit cards, massive mortgages. How much can kicking can we do before things start to fall apart?

Windofchange

I guess your answer to what will happen once interest rates go up and foreign investment stops is that the Indians will come spend some of their £100 trillion in buying up Battersea?

GreatApe

Crashy_Time wrote: »

The property market won`t "drift down" IMO that is not how it has historically functioned, when sentiment turns it will be carnage IMO, you can`t get out of a bubble like this without pain, nothing really holding it up now.

we have already had a huge crash in the north of the country,

In real terms prices crashed more than 30% in the NE over the decade
Mortgage rates have also crashed from 5.5% to 2% making affordability even better than the 30% real term crash indicates

But bears in the NE are still not happy. Why?
And its not just the NE, prices have crashed in real terms in the NW Y&H Wales Scotland NI WM EM


If there is a crash I see the same thing happening, a notable real term crash (30%) but a tiny nominal crash (10%) over a period of a decade or so. And considering how much prices have boomed over the last 5 years the crash will only really hit the 3% of buyers that transacted in the very peak year. The other 97% of homeowners would see no nominal price crash from when they buy to 10 years post a crash

GreatApe

Windofchange wrote: »

They can ask what they want - doesn't mean they are selling.

Don't remember saying that I think things are in freefall. I said that I think things will fall fast in the near future. This is near in property cycle terms of course, not next week or month.

What do you suppose will happen to those square metre valuations once interest rates creep up and the foreign investment stops? Reckon the local population will step in?

Yes I think the local London buyers can support the local London prices.

Battersea does not look particularly expensive to me. Prices for the new build developments look roughly similar to prices for old terrace houses in Hackney (on a per sqm basis). Battersea is probably a better location but in Hackney your buying a house not a flat.

Wandsworth (which is the borough Battersea is in) average price is £591k while London average is £483k. That seems a modest premium of £108,000 to be within walking distance of the two biggest employment hubs in London (westminster & city)


I really love the bears. They change the goal post so many times its amusing.
I recall in early 2016 they were partying that April 2016 was the start day of the country wide crash as the BTLers were hit with +3% stamp duty, removal of W&T and the S24 and brexit. Ouch many billions drained from the housing market.

Fast Forward a year and prices from April 2016 to April 2017 are up £21,500 for London.
Admittedly wandsworth is down £8,000 but Haringey is up £42,500

GreatApe

Windofchange wrote: »

I guess your answer to what will happen once interest rates go up and foreign investment stops is that the Indians will come spend some of their £100 trillion in buying up Battersea?

Yes they will, but they dont have to there is plenty of demand in the UK to live in expensive London areas.

Crashy_Time

Crashy_Time

GreatApe wrote: »

Yes I think the local London buyers can support the local London prices.

Battersea does not look particularly expensive to me. Prices for the new build developments look roughly similar to prices for old terrace houses in Hackney (on a per sqm basis). Battersea is probably a better location but in Hackney your buying a house not a flat.

Wandsworth (which is the borough Battersea is in) average price is £591k while London average is £483k. That seems a modest premium of £108,000 to be within walking distance of the two biggest employment hubs in London (westminster & city)


I really love the bears. They change the goal post so many times its amusing.
I recall in early 2016 they were partying that April 2016 was the start day of the country wide crash as the BTLers were hit with +3% stamp duty, removal of W&T and the S24 and brexit. Ouch many billions drained from the housing market.

Fast Forward a year and prices from April 2016 to April 2017 are up £21,500 for London.
Admittedly wandsworth is down £8,000 but Haringey is up £42,500

How are sales volumes holding up?

GreatApe

April 2016:

Bears: Dear brothers and sisters it has begun. The government is on our side the stars have aligned. S24, additional stamp duty surcharge, brexit, removal of W&T and negative sentiment. Sit back and enjoy we will soon be victorious the crash will be quick and painful.

Me: Dont hold your breath

---

April 2017 Land Registry Data for the previous 12 months

Wandsworth -£13,500 (-£8,500 for flats)

BagOfWind: HAHAHHAHA it has begun nothing will stop it we will be victorious!! Fire sale in battersea proves E.V.E.R.Y T.H.I.N.G


Me: What about all the non Wordsworth places?

UK + £11,600
England +£12,700
London +£21,700
Haringey +46,000

BagOfWind: F....U

GreatApe

Crashy_Time wrote: »

How are sales volumes holding up?

Average of the last 6 months on LR has been 7,400 units per month for London and prices are up £21,700 on the year (April 2016 - April 2017)

:rotfl: