Ridiculous listing prices

FirstTimeSolo

MobileSaver said:

FirstTimeSolo said:

MobileSaver said:

If you are talking about people actually moving in together then that is very surprising considering it's been practically illegal for all intents and purposes over most of the last 12 months. 

People can move in together if they are in a support bubble together - single person households can form a support bubble with another household of any size. 

Agreed but pretty much everyone I know created a support bubble with their parents as soon as the first lockdown was announced and as far as I know you weren't supposed to chop and change who the bubble was with.

Referring to people who lived apart but knew each other and formed bubbles and now live together. Many people have parents who live too far or even in a different country. 

Mickey666

Crashy_Time said:

RelievedSheff said:

Crashy_Time said:

RelievedSheff said:

Crashy_Time said:

Getting_greyer said:

OK, so you're anyone tje drop in transactions is due to banks not willing to loan to as many people, therefore there is now less buyers available whom are able and willing to pay current prices.

Yes, it all hangs on the price of credit and the availability of credit. Some people won`t get the loans they need, some will rent cheaply and stay out of the bubble, others will try to save deposits but this will take years in some cases and also keep them out of the transaction figures (see the mad scramble when SD was cancelled for evidence of this desperation to buy into something you can`t really afford) Many will only be participants on two wages, all their savings and loans from family, any disruption to their incomes or rising mortgage rates will see them in trouble.

But there won't be cheap rents if mortgage rates increase and landlords increase their rents to cover their costs. 

Stamp duty is a minimal cost in the house buying process in most cases.

Many landlords don`t have mortgages, rents are driven by wages and employment levels not landlord costs, smart landlords who don`t want voids and double council tax know what to do IMO.

So in your opinion landlords rent out houses for the love of it not the money?

Your posts get more bizarre by the day!! 

No, landlords are influenced by market conditions like any other business.

Yes, and part of the market conditions are things like their costs and their capital employed.  Even if a landlord owns a property outright and has no mortgage costs, that doesn't mean they can charge a very low rent based on wages (assuming they're serious about acting like a business) because they have their capital employed in the business, on which they will expect a certain return.

Simplistically, their capital employed is the value of the property and the rent they charge is the required return on that capital.  If the rental income is too low then they are better off selling the property and investing that capital somewhere else, such as the stock market.

So, wages and employment levels are a factor but they are not the DRIVING factor you seem to think they are because the Landlord has alternative investment options whereas those looking to rent have no alternative (other than buying) for the simple reason you continually ignore - everyone NEEDS somewhere to live and the only choice is to rent or buy. 

Greymug

Reading this thread makes me feel so lucky that I live in Scotland and the rules for property buying and selling are set up in much more fair way for everyone. Go Scotland

MobileSaver

Crashy_Time said:

1. How do you explain house prices have been rising for the last ten years if the "property bubble was in trouble"?
2. How do you explain report after report confirming people are moving away from urban areas to less-urban areas with bigger properties and bigger gardens if people cannot afford them?
3. How do you explain house prices increasing by 6% if we are in the "biggest downturn in living memory"?

1. Zero interest rates and government support schemes, no way this level of pricing can survive interest rate increases.
2. EA`s are trying to bang the drum for their rural business..."Look...EVERYONE is buying THIS now!" It is just basic out of date advertising tactics, will have absolutely zero baring on underlying fundamentals, and will disappear like smoke when Covid disappears.
3. Are you talking asking or actual sold?

1) So if interest rates rise there WILL BE a house price crash?

2) So the report THAT YOU LINKED TO was false and they lied about people moving from inner London to bigger properties on the peripheries creating so much demand that they had to move staff around? Why would you link to such a false article?

3) Actual sold, so how do you explain actual sold prices increasing by 6% if we are in the "biggest downturn in living memory"?

Prices ended 2020 up 6% on the previous year

GDB2222

MobileSaver said:

Crashy_Time said:

1. How do you explain house prices have been rising for the last ten years if the "property bubble was in trouble"?
2. How do you explain report after report confirming people are moving away from urban areas to less-urban areas with bigger properties and bigger gardens if people cannot afford them?
3. How do you explain house prices increasing by 6% if we are in the "biggest downturn in living memory"?

1. Zero interest rates and government support schemes, no way this level of pricing can survive interest rate increases.
2. EA`s are trying to bang the drum for their rural business..."Look...EVERYONE is buying THIS now!" It is just basic out of date advertising tactics, will have absolutely zero baring on underlying fundamentals, and will disappear like smoke when Covid disappears.
3. Are you talking asking or actual sold?

1) So if interest rates rise there WILL BE a house price crash?

2) So the report THAT YOU LINKED TO was false and they lied about people moving from inner London to bigger properties on the peripheries creating so much demand that they had to move staff around? Why would you link to such a false article?

3) Actual sold, so how do you explain actual sold prices increasing by 6% if we are in the "biggest downturn in living memory"?

Prices ended 2020 up 6% on the previous year

Unless the 6% is adjusted for the type of property, it could be misleading. At least, theoretically. For example, suppose more houses are being sold at the moment than a year ago, and fewer flats. Houses tend to be more expensive, so the average price per transaction goes up. Likewise, there may be more transactions in expensive areas than a year ago. It is actually extremely difficult to construct an unbiased housing price index. 

I live in East Finchley, which includes Bishops Avenue, where houses sell for £50m, as well as lots of ordinary houses. One of the Bishops Avenue houses selling totally skews the local statistics.

MobileSaver

FirstTimeSolo said:

MobileSaver said:

Agreed but pretty much everyone I know created a support bubble with their parents as soon as the first lockdown was announced and as far as I know you weren't supposed to chop and change who the bubble was with.

Referring to people who lived apart but knew each other and formed bubbles and now live together. Many people have parents who live too far or even in a different country. 

Yes, a relatively small number of people will undoubtedly fit the specific criteria you have laid out.

MobileSaver

GDB2222 said:

MobileSaver said:

3) Actual sold, so how do you explain actual sold prices increasing by 6% if we are in the "biggest downturn in living memory"?

Prices ended 2020 up 6% on the previous year

Unless the 6% is adjusted for the type of property, it could be misleading.

I agree in principle but even then, pretty much whichever way you slice the pie, it would appear to contradict the "biggest downturn in living memory" claim.

Tokmon

MobileSaver said:

Tokmon said:

MobileSaver said:

If you are talking about people actually moving in together then that is very surprising considering it's been practically illegal for all intents and purposes over most of the last 12 months.

Has it actually not been allowed for two people to move in together? I haven't seen any guidelines saying either way but maybe I've missed it.

Two people not already in the same household or a bubble are not allowed to meet indoors full stop.

Although what I was really getting at was that two people don't normally move in together without having a physical relationship first and social distancing, lockdown and the closing of bars and pubs has effectively put a stop to that except for the special people that the rules don't apply to.

I was thinking of the couples who were together before lockdown and then decided due to all these lockdowns it was a good time for them to move in together so they can actually spend time together without breaking any rules. 
So i was wondering if them moving in together was actually against the rules.

Mickey666

GDB2222 said:

MobileSaver said:

Crashy_Time said:

1. How do you explain house prices have been rising for the last ten years if the "property bubble was in trouble"?
2. How do you explain report after report confirming people are moving away from urban areas to less-urban areas with bigger properties and bigger gardens if people cannot afford them?
3. How do you explain house prices increasing by 6% if we are in the "biggest downturn in living memory"?

1. Zero interest rates and government support schemes, no way this level of pricing can survive interest rate increases.
2. EA`s are trying to bang the drum for their rural business..."Look...EVERYONE is buying THIS now!" It is just basic out of date advertising tactics, will have absolutely zero baring on underlying fundamentals, and will disappear like smoke when Covid disappears.
3. Are you talking asking or actual sold?

1) So if interest rates rise there WILL BE a house price crash?

2) So the report THAT YOU LINKED TO was false and they lied about people moving from inner London to bigger properties on the peripheries creating so much demand that they had to move staff around? Why would you link to such a false article?

3) Actual sold, so how do you explain actual sold prices increasing by 6% if we are in the "biggest downturn in living memory"?

Prices ended 2020 up 6% on the previous year

Unless the 6% is adjusted for the type of property, it could be misleading. At least, theoretically. For example, suppose more houses are being sold at the moment than a year ago, and fewer flats. Houses tend to be more expensive, so the average price per transaction goes up. Likewise, there may be more transactions in expensive areas than a year ago. It is actually extremely difficult to construct an unbiased housing price index. 

I live in East Finchley, which includes Bishops Avenue, where houses sell for £50m, as well as lots of ordinary houses. One of the Bishops Avenue houses selling totally skews the local statistics.

Depends.  If the £50m house was bought last year for, say £47.5m, then that's a £2.5m increase which sounds a lot but is still only 5%.  It would be pretty daft to use that example to say that house prices in East Finchley have increased by £2.5m, but rather more reasonable to say they've increased by 5%.

Though it raises the good point that when transactions are low, prices are an unreliable guide, which is maybe where Crashy goes astray.  In a recession, people tend to 'hunker down' and sit tight to weather the storm.  Some people will be forced to move during the storm of course and if conditions are not good they may end up selling low. 

But extrapolating that to a market 'crash' is dangerous because the majority of people probably had no intention of selling at that price and, as pointed out before, a 'theoretical' crash has no effect on them at all - they have their home, they pay the same mortgage, nothing has changed for them.

Then, when the storm passes, more people start looking around to move and prices suddenly 'recover' back to their previous levels or more.  But it's not so much a recovery, more the case that very few people would ever sell so low in the first place and they are merely picking up again where things left off before the 'crash'.  In other words, the 'crash' was just a temporary blip rather than a market correction.  We've seen it time and time again and many of us have lived though it, negative equity and all, and survived to tell the tale.

Getting_greyer

To work out how skewed the data is we just need the list of total houses sold for each individual price, a couple of hours and a good calculator 😀