How has this house gone up so much?

Mark_Glasses

There's a house in a little town in the midlands that sold in 2013 for £360k. Then someone I know bought it in 2016 for £535k. 

I thought he'd been ripped off, but then he sold it this year for £975k.

It looks like it was in good condition when he bought it and he's not extended it. If this was in London I wouldn't be as surprised, but this is some midlands backwater nobody has heard of.

The house next door sold around the same time for £580k. It is a little bit smaller, but I really can't get my head around how he managed to sell his house for £975k.

I bought my flat for £275k in 2017 and it's barely gone up in value since.

I've always said if he can do it so can I, but he's well and truly beating me financially.

lookstraightahead

The last couple of years had seen people buy and sell for random prices, I think people lost sight of reality for a while. Interest rates were low and we didn't know what was happening economically.

now I think sellers still think their houses are worth it and buyers are more realistic, so houses are stagnating. For this particular house it was probably a cash buyer who didn't need a valuation or mortgage. 

My opinion anyway.

CSI_Yorkshire

A midlands backwater that somehow people have decided is now a commuter suburb of London because they still believe in HS2?

johnhenstock

family homes will always go up in value, regardless of economy and interest rates. you're on an island with very difficult planning laws, land is a very, very finite resource and it's becoming increasingly difficult to get your hands on a patch. add to it population growth, extremely expensive rents and the thought of paying a significant amount of money for your own place, which will likely be worth a fortune by the time you retire, is not that dark anymore...

people always look at the cost of something, but NEVER at the cost of alternatives. if my mortgage is £1500 but renting would be £2000, I'm getting a bargain.

MultiFuelBurner

Flats with all the bad media on cladding and leasehold issues will generally.not rise as much as a house.

Some stagnate even in a rising market they are not the best step on the ladder.

strawb_shortcake

Some parts of the Midlands are pretty pricey, we have family around Sutton Coldfield and Four Oaks area, I think we'd struggle to buy in either of these areas.

p00hsticks

CSI_Yorkshire said:

A midlands backwater that somehow people have decided is now a commuter suburb of London because they still believe in HS2?

And if it was directly in the path they could have made a killing
Comedian John Bishop sells mansion to HS2 for £6.8m - BBC News

Individual properties don't necessarily follow the more general trend - you only need to get two relatively rich people bidding against each other for a relatively unique property that rarely comes on the market for prices to soar....

There are usually a few premier league footballers looking for properties in the Midlands & North West of England, for example, and 'some midlands backwater that nobody's ever heard of' probably suits them down to the ground......

Mark_Glasses

@lookstraightahead I would have thought a cash buyer would pay less

@CSI_Yorkshire this town doesn't even have a train station

@johnhenstock it's almost doubled in price

@MultiFuelBurner it's the only step on the housing ladder round here, houses cost £600k+

@annabanana82 it's clearly expensive for the midlands but for £975k you can buy houses in London.

johnhenstock

Mark_Glasses said:

@lookstraightahead I would have thought a cash buyer would pay less

@CSI_Yorkshire this town doesn't even have a train station

@johnhenstock it's almost doubled in price

@MultiFuelBurner it's the only step on the housing ladder round here, houses cost £600k+

@annabanana82 it's clearly expensive for the midlands but for £975k you can buy houses in London.

the actual amount or multiplier since an arbitrary date is pretty irrelevant. since someone paid that amount for it, it's worth that much for that person. and if the market works based on transactions and willingness to pay (or not) for a house, then it MUST work both ways.

if I advertise a house at £600k but people only offer £400k, then that's the price/value. if I advertise for £400k but people are willing to pay £600k, then that's the value. it's literally a snapshot, nothing more, people tend to overthink "the market", whatever that means.

motorman99

A nice house in a nice road will always sell for decent money in the end. Always. As stated above, they can’t make any more ground , and everyone wants to live in the UK. 

Flats……not so much. Leasehold, cladding, ground rents, service charges, just not the way forward. 

motorman99

I was 6 yo in 1962 and my parents bought a house in Windsor, nice house, 10 min walk to town centre etc.
I know they paid £6950 for it
sold in 1970 for £13750
it was sold about 3 years ago pre Covid for over £900k

its staggering even at todays prices to think that you can buy a house in a nice road for £400,000 and yet by 2040 it will be worth £850,000. It wil, it just will, there is no 10 year period in the last 100 odd years where house prices haven’t increased substantially. 

With population growth and land shortage (land isn’t short, but house building land where people actually want to live is very short) this will only carry on, despite interest rates, hpc ers or anything else