Price of nearly new appartments (Chester)

lynzpower

Actually - Ive had a thought.

the best thing to do is to find a flat in a development on RM. ( obv a NBish one)

then see if on nethouse prices you can see what they paid.

Wastn there one on here the other week about a flat in Woolwich london that sold for about 200 then 2 years later at auction it went for 41? Does anyone remember that conversation?

Doozergirl

It's not off topic at all.

New build apartments about three months ago, were the only sector of the market to have fallen in value in real terms and I'd say that the first part of this year was fairly bouyant in many places. A new build house might be overpriced by 10% say, apartments seem to be far more overpriced and so the prices of subsequent sales continue to fall. A friend of a friend bought new build in Birmingham 4/5 years ago. His flat is worth no more today than he paid for it. Most of us have seen some sort of rise in that time!

The more they build, the less demand, the greater the supply, the weaker prices become. They're hardly going to rise in price when the choice is so vast.

lynzpower

eaustin wrote: »

Thanks for the responses. Before this discussion goes too much off topic, what I was really asking for was an estimated 'loss' of value for new appartments before they start appreciating again or in other words the 'premium' that buyers might pay for buying a brand new appartment.

Again, thanks to everyone who as contributed so far.

hang on one minute, this presumes that the market will be constantly rising.

Ie, you buy said flat new, it loses value for a bit, then it rises again.

But why would it, the market in some northern towns ( leeds, manchester are 2 im familiar with) is SATURATED with these flats, and new or 2nd hand they are not selling.

ONe has to presume there is always going to be consumer demand for this sort of product. Personally Im not convinced. Why are you?

eaustin

Thanks Doozergirl. Your thoughts are very helpful (and worrying!) although not unexpected - hence my original post.
I agree that over supply has reduced the demand and consequently the price, and so making a fair judgement on the true value is extremely difficult.
I'm currently living in a fairly large terraced house in a desirable suburb of the city, but I quite fancy moving to an appartment which I think would suit me and my partner's lifestyle. The one we're interested in is quite large by appartment standards and comes with underground secure parking and a roof top garden. We just don't want to pay too much in case at some point in the future we need to sell. Adding the uncertainty of the economy it's making this a difficult decision.

lynzpower

She bought the flat in 2004 when it was priced at £227,000 with a target rent of £1,100 a month. She has a £180,000 mortgage and the monthly rent is £650. She is selling it at £150,000 - and says there is 'absolutely no interest'.

this is manchester, which to be fair, I would expect to have higher demand & better salaries etc than chester.

from here- courtesy of trev http://www.thisismoney.co.uk/home/article.html?in_article_id=426172&in_page_id=1&ct=5

eaustin

lynzpower wrote: »

hang on one minute, this presumes that the market will be constantly rising.

But why would it, the market in some northern towns ( leeds, manchester are 2 im familiar with) is SATURATED with these flats, and new or 2nd hand they are not selling.

ONe has to presume there is always going to be consumer demand for this sort of product. Personally Im not convinced. Why are you?

Lynzpower
Well of course you make a valid point. What I'm trying to do is try to understand (guess!?) where property prices are for (new) city centre appartments in relation to house prices in general. There does seem to be a concenus that they are overpriced and that they may well have a deal further to fall. So trying to establish a fair value is proving very difficult!

lynzpower

eaustin wrote: »

Thanks Doozergirl. Your thoughts are very helpful (and worrying!) although not unexpected - hence my original post.
I agree that over supply has reduced the demand and consequently the price, and so making a fair judgement on the true value is extremely difficult.
I'm currently living in a fairly large terraced house in a desirable suburb of the city, but I quite fancy moving to an appartment which I think would suit me and my partner's lifestyle. The one we're interested in is quite large by appartment standards and comes with underground secure parking and a roof top garden. We just don't want to pay too much in case at some point in the future we need to sell. Adding the uncertainty of the economy it's making this a difficult decision.

Sorry just saw this!

Could you not just rent one- if its vacant - itll be a hell of a lot cheaper than a mortgage and might be keeping our Lls out of bankrupcy.

mr218

whatever you do, do not forget the service charges. they can often be exorbitant. also as more and flats remain empty due to oversupply you can see LA tenants come in. so the luxury apartment becomes essentially a council house and the premium you paid for a luxury development has vanished into thin air.

i would always be worried about service charges and the cost of extending the leasehold etc as you can always been exploited depending on the freeholder.

why not try and rent in an equivalent flat. that way you have the experience of living there and none of the hassle of falling prices, service charges etc

good luck
meera

Doozergirl

From http://www.thisismoney.co.uk/mortgages/buy-to-let/article.html?in_article_id=421346&in_page_id=56

"The lack of value in new flats is even more starkly illustrated by comparing house price rises since 2000. Land Registry figures show the average cost of all property rose by 89.5% between December 2000 and December 2006, but the average cost of new-build flats rose by just 5.3%."

I don't spend my time here telling people not to buy. I believe that people need homes and that as long as you go in with your head screwed on, within a sensible budget and are in it for the long term, then you will get through. But city-centre living has been kept afloat by investors really and I cannot think of a worse property purchase for anyone. Of course, it makes no difference to me whether someone buys into or not.ree with L

EDIT: I agree with Lynzpower, if it suits your lifestyle then when not rent in that part of town? It's positively bargainous compared to the mortgage repayments or the interest you'd get with the money in the bank. Choice I bet is good. And if your lifestyle changes, you can buy a nice house a bit further out of town.

ashm1

eaustin wrote: »

There has been a large number of appartment developments in the city of Chester over the last few years. I am interested in purchasing one but am having difficulty in trying to work out a 'true' value. There seems to be a glut of appartments in the city and more developments in progress so I don't want to overpay.

Is there a genral 'rule of thumb' for the amount a new flat looses? We know new cars loose an amount of value when you drive it off the forecourt is is something similar with new appartments?

Any thoughts / suggestions welcomed.

Edward

Why buy if there is a 'glut of appartments'?