Has the market crashed?

SeanG79

Think it makes a big difference where in the country you are.

We are just about to complete on a new build and in the development they released 2 houses at the start of the month (at a higher price than similar properties in the development sold for a few months ago) to market and they were both reserved within a week with minimal incentives.

Noneforit999

GDB2222 said:

We’re going to have to see what happens in a few months time, when the old mortgage offers run out. I feel sorry for people who previously bought on the basis of 1.5%-2% interest rates, but only locked in their rates for a couple of years. 

Haven't lenders been stress testing affordability up to 6% for a number of years to ensure borrowers had enough disposable income to deal with a rate hike?

70PC

77588p said:

Our house went on the market a week ago today for £365,000. I live on a desireable estate which was only built 5 years ago. There are about 7 different house types on the estate and ours is one of the larger houses. 

So far we have had 0 viewings or interest. My friend lives in the smallest house type on our estate and in June this year put her house on the market for £330,000 and had lots of viewings. She eventually removed it and cancelled most of the viewings as the house she wanted to buy had sold.

I always agree with the principle that if a house isnt getting viewings then its over priced but it doesnt feel over priced compared to recent sales in the summer.

My question is... has the housing market collapsed due to rising rates and stories of reducing house prices?

Or actually could we just be over priced?

I know a week isnt a long time but to have zero viewings has taken the wind out of our sales. I have emailed estate agent today asking for their thoughts. My view would be to either reduce now to £349,950 or to pull the house till spring next year when hopefully things have settled.

Your reason for selling matters. If you are looking to buy a bigger place, waiting is likely to work well. If prices are to go down as predicted, you will save more on your next place than lose on this one. If you are downsizing or getting out of the property market, waiting is risky in the current climate. 

GDB2222

Noneforit999 said:

GDB2222 said:

We’re going to have to see what happens in a few months time, when the old mortgage offers run out. I feel sorry for people who previously bought on the basis of 1.5%-2% interest rates, but only locked in their rates for a couple of years. 

Haven't lenders been stress testing affordability up to 6% for a number of years to ensure borrowers had enough disposable income to deal with a rate hike?

For stress testing, the requirement is to test at 3% over SVR, which would typically have been 5-6%. There are two issues I can see:

The borrowers may find their expenditure has grown to use up the income available, so there'll have to be some severe belt-tightening.

Supposing, by the time they are looking to remortgage, the SVR is 6%,  they'll be stress-tested at 9% (unless the rules change).  I assume they can stay with their existing lender, paying SVR, even though they might fail the 9% stress test.

Aberdeenangarse

My partner was going to sell her house last year when a similar Property sold for £475k. As we were away a lot we didn’t get around to it until this year. Flabbergasted when EA valued it at £565,000 in June,and even more so when we had a cash offer, after only 2 hours after listing, for nearly £600k !!! Completed end of September, with the only stressful thing finding where to stick the cash! I’m not surprised to see the market heading south rapidly. The rocketing prices since covid has been complete madness!

GDB2222

Aberdeenangarse said:

My partner was going to sell her house last year when a similar Property sold for £475k. As we were away a lot we didn’t get around to it until this year. Flabbergasted when EA valued it at £565,000 in June,and even more so when we had a cash offer, after only 2 hours after listing, for nearly £600k !!! Completed end of September, with the only stressful thing finding where to stick the cash! I’m not surprised to see the market heading south rapidly. The rocketing prices since covid has been complete madness!

Quite a lot of people exited London during the pandemic, and this had an effect on prices elsewhere. People were happy getting paid Inner London weighting, whilst WFH in Yorkshire!

That's all changing, as many employers are now beginning to require attendance in the office several days a week, which must be a gigantic PITA from Yorkshire. I think we'll see some of the super-hot areas becoming normal, or even cool again, as the exodus from London reverses. 

snowqueen555

All the flats on my watchlist are STC. I think there have been more reductions for the overpriced ones, but nothing more substantial than 5%. 

JJR45

Our search area has twice the number of houses on the market compared to the summer. There now as many houses STC as up for sale. In the summer there were 4 times as many houses STC as there were on the market.

77588p

Since reducing the price to 345 we have had 2 viewings booked. First one has just taken place and they loved it, but have not yet sold theirs. Lets hope the 2nd viewing is the one. 

fackers_2

In my experience, I believe so.  I have been aggressively looking at houses, noting down listing prices then their reduced price etc. Our large search area is within the SW stretching as West as Bristol and East as Swindon. Almost all houses we are interested in are on for minimum 2 weeks before any change, in that there is almost always a price drop of around £20k-£30k. Speaking to several EA’s, they are saying market is incredibly quiet and sellers are very nervous about the market dropping much more. They are overly keen in asking to make offers, even when we’ve suggested it might not be for us.

The types of houses that are listing I can see are mainly of those who are elderly people downsizing or moving into a home. 

A brand new build site in Chippenham offered us 6 months of the mortgage paid on this particular property, it then came down £25k a week after viewing - This is a brand new 3 bed house on their estate that’s never been lived in. 

The market has started to crash from where I’m looking. I believe we will see more of a drop once the cost of living crisis really kicks in within their bills and bank accounts depleted. 

-

Having watched the market for the last 3 years, it’s about time these prices are cooled. A greed driven market over the last 2 years. (Of which I have benefitted with a 38% increase in the house I recently sold I admit).