Should I be wary buying a house in the current climate?

stehouk

Iv'e been looking at the property market in my area for a while now and prior to the pandemic hitting the country there were only 2-3 houses per week/fortnight all of a sudden there are between 3-5 houses per day being listed, are people trying to off load their houses before the crash........ i think they are and it will be a case of supply and demand the more houses on the market the more competition and house prices will fall.

50Twuncle

stehouk said:

Iv'e been looking at the property market in my area for a while now and prior to the pandemic hitting the country there were only 2-3 houses per week/fortnight all of a sudden there are between 3-5 houses per day being listed, are people trying to off load their houses before the crash........ i think they are.

There will NOT be a crash - there are still too many potential buyers - there may be a slight correction of around 10%

stehouk

The potential buyers will no longer have jobs, there is going to be a hard recession and then brexit, there WILL be a crash.

50Twuncle

stehouk said:

The potential buyers will no longer have jobs, there is going to be a hard recession and then brexit, there WILL be a crash.

There will be no crash

50Twuncle

stehouk said

Iv'e been looking at the property market in my area for a while now and prior to the pandemic hitting the country there were only 2-3 houses per week/fortnight all of a sudden there are between 3-5 houses per day being listed, are people trying to off load their houses before the crash........ i think they are and it will be a case of supply and demand the more houses on the market the more competition and house prices will fall.

And where are ALL these sellers going to live ?

Thrugelmir

50Twuncle said:

stehouk said

Iv'e been looking at the property market in my area for a while now and prior to the pandemic hitting the country there were only 2-3 houses per week/fortnight all of a sudden there are between 3-5 houses per day being listed, are people trying to off load their houses before the crash........ i think they are and it will be a case of supply and demand the more houses on the market the more competition and house prices will fall.

And where are ALL these sellers going to live ?

In cheaper houses. 

Crashy_Time

50Twuncle said:

stehouk said

Iv'e been looking at the property market in my area for a while now and prior to the pandemic hitting the country there were only 2-3 houses per week/fortnight all of a sudden there are between 3-5 houses per day being listed, are people trying to off load their houses before the crash........ i think they are and it will be a case of supply and demand the more houses on the market the more competition and house prices will fall.

And where are ALL these sellers going to live ?

Where did people live when prices collapsed in 2008 and late 80`s for example? Don`t confuse your feelings about the asset with the potential asset price/value, that is a basic investing mistake to avoid IMO.

GDB2222

50Twuncle said:

stehouk said:

Iv'e been looking at the property market in my area for a while now and prior to the pandemic hitting the country there were only 2-3 houses per week/fortnight all of a sudden there are between 3-5 houses per day being listed, are people trying to off load their houses before the crash........ i think they are.

There will NOT be a crash - there are still too many potential buyers - there may be a slight correction of around 10%

I'm not predicting a crash, either. But I think that a 10% price correction is more than 'slight', and if I were buying I'd certainly wait a few months in order to get that sort of reduction.  

Windofchange

GDB2222 said:

50Twuncle said:

stehouk said:

Iv'e been looking at the property market in my area for a while now and prior to the pandemic hitting the country there were only 2-3 houses per week/fortnight all of a sudden there are between 3-5 houses per day being listed, are people trying to off load their houses before the crash........ i think they are.

There will NOT be a crash - there are still too many potential buyers - there may be a slight correction of around 10%

I'm not predicting a crash, either. But I think that a 10% price correction is more than 'slight', and if I were buying I'd certainly wait a few months in order to get that sort of reduction.  

But there is no guarantee you are going to get that reduction. Drops in prices can be very region specific, and very situation specific. Forced and desperate sellers may have a bit more pressure, and there may be some bargains to be had, but given how strong the property markets were at the start of the year before corona virus, it really wouldn't surprise me if certain parts of the market just carried on as they were. There are so many nuances to buying a property that are specific to each situation that you cannot just chuck a blanket over it all and say sit it out.

In my n=1 case, we are building towards hopefully exchanging contracts in the next few weeks once the country is allowed to move again, and I am not going to be pulling out or trying to re-negotiate. In my part of SE London, demand was through the roof, and we had to fight off multiple offers to get what we have. That demand won't have gone away overnight regardless of the wider economy - not everybody is on a zero hours contract, and certainly in the price range we are buying in, people have resources. We are both NHS workers, and our jobs could not be more secure, particularly in this time. We are planning to start a family in this house, stay for at least 10 years, if not longer, and any short to mid term drops just aren't a factor to my thinking. 

The issue with trying to guess the property market is that it is not driven by economics. Of course economics affect it, but there is a lot of heart and emotion that goes into something. I love our potential new home, and if it takes a hit for the next few years then it's not something I will cheer about, but at the same time, it's not something I will lose sleep over. If you find somewhere you love, and you can see yourself there for the long term, then look at the positives - never seen before low interest rates, the security of owning somewhere whilst you sit any recession out, building equity in the long term even if you are going to take a slight bath immediately. Circumstantially, I cannot wait much longer to do this as I won't get a mainstream lender 25 year term, and for us it is a case of fortune favours the brave!

50Twuncle

There will always be  a shortageof property - especial with the virus causing no new builds
This will  ensure that prices remain as they are now