Should I rent my flat out for another year or sell now in a poor market?

N1_EP

Shadyocuk thank you - great to have your view. 

ReadySteadyPop

RHemmings said:

Shadyocuk said:

Whilst ReadySteadyPop might have been historically biased, the property market in England in general is not looking in great shape.

Generally speaking prices are down and falling , both London area and flats being particularly hit due to ever increasing service charges. All the usual (biased) price valuation metrics are showing a fall.

small scale BTL landlords are trying to exit the market , the renters reform bill will only make this worse and given the state of the countrys finances you would not wont to rule out futher increases in capital gains tax rates.

I don't see anything happening between now and September that will improve the market , and by then the next budget is just round the corner. Even if the BOE cuts interest rates, Gilts and Swap rates are more likely to go up than down (Trump's new bill and our lack of a credible chancelor mean both the UK and the USA have to sell lots of new Gilts).

Most estate agents initally over value by at least 10% , if a buyer needs a mortgage its the banks valuation that will matter not the estate agents marketing price.

For every new buyer entering the market there is 3+ new sellers at a time when the stock of properties for sale is allready higher than any recent year (most just sitting there as they are overpriced) and yes despite growth in both population and housing stock the number of sales are about 50% below historical averages.

If I owned a BTL flat in London , I would want to get shot of it ASAP.

The issue with the 'crash merchants' is that they assume certainty of doom and portray that as a certainty.

Nobody is saying that the market is in good shape right now. After a boom earlier in the year (which RSP appears to have vaguely denied but has not yet provided a source for their statistics concerning January sales), there is now a lull. But, this is equally explained by the end of the stamp duty holiday. For example, this graph showing the huge jump in March, the huge drop in April, and a small recovery in May. 



(Graph from: https://www.gov.uk/government/statistics/monthly-property-transactions-completed-in-the-uk-with-value-40000-or-above/uk-monthly-property-transactions-commentary--2) 

Clearly this is not a normal situation, and transactions and price data from around the end of the stamp duty holiday are unlikely to indicate a long-term trend. 

It has been mentioned before that RSP is a 'stopped clock', and of course house prices do go down as well as up. This has been mentioend. But, the sizeable crash that RSP predicts and has been predicting since 2007 (for those who know where to look) hasn't happened. Because it's more sizeable than will ever happen.

It's me that has posted plots from Plumplot, which I often do when estimating what a property might be worth given previous sales prices and the time since a property last sold. Looking at these, there has already been a real-terms price crash, in places like London especially. As is normal, in nominal terms the price change is typically less, though still notable in London. We don't know if that has deflated the market to a point where it will start rising again, or not. Nobody knows that. Then people risk missing a good opportunity (as RSP missed the post-2008 reduction in prices) because of bad advice. We don't know whether currently reduced prices (very significantly in London) are a good opportunity or not. But, they could be. 

What we don't know is what is going to happen in the future. And, the history of housing is of people making predictions that are proven wrong. Advising people whether or not they should buy/sell/whatever based on claimed certainty as to what the market will do in the future is not a good thing to do. People need to understand that the property market can't be predicted, and consider that uncertainty when deciding what to do. 

What happens in this forum is that RSP will make unsubstantiated claims based on 'the current market' which, no matter what the market is currently doing, are always to reduce price drastically 'still £100,000 overpriced', make ridiculous offers that won't be accepted, or to not buy and wait because in the near future houses will be much cheaper. These, e.g. the claim that sales in January this year were half the long-term average (which they weren't) then get rebutted with facts and figures, which then becomes 'debating house prices and the economy'. Which is banned in this forum. But, if you see someone in the forum misleading new posters who might assume that RSP knows what they are talking about, do we just let it be? It's not difficult to find RSP elsewhere on the internet and find the boasts as to what they are doing on here (MSE). As well as their long-term history and the consistency of their negative view, whether the market is booming or contracting.

As I said I think looking at the longer term picture is more sensible, especially if you are taking on a lot of debt or struggling to sell a house.

https://www.statista.com/statistics/290623/uk-housing-market-monthly-sales-volumes/

N1_EP

Emmia I have started a pension this year and put as much as I could in. I am a freelancer in tv and they have found very clever ways to contribute the smallest amount possible to our pensions but I now making sure I don't let them automatically defer my pension and I also contribute as much extra as I can afford.  So i'm doing as well as I can.

My state pension is fine I have paid enough contributions. I checked that recently. 

N1_EP

RHemmings Thank you very much for taking so much time to explain more about forumites and flagging I shouldn't just assume all info her is faultless.  I appreciate it!

I am finding in general amongst the many voices the same thing is generally being advised which I find helpful.

Hoenir

ReadySteadyPop said:

RHemmings said:

Shadyocuk said:

Whilst ReadySteadyPop might have been historically biased, the property market in England in general is not looking in great shape.

Generally speaking prices are down and falling , both London area and flats being particularly hit due to ever increasing service charges. All the usual (biased) price valuation metrics are showing a fall.

small scale BTL landlords are trying to exit the market , the renters reform bill will only make this worse and given the state of the countrys finances you would not wont to rule out futher increases in capital gains tax rates.

I don't see anything happening between now and September that will improve the market , and by then the next budget is just round the corner. Even if the BOE cuts interest rates, Gilts and Swap rates are more likely to go up than down (Trump's new bill and our lack of a credible chancelor mean both the UK and the USA have to sell lots of new Gilts).

Most estate agents initally over value by at least 10% , if a buyer needs a mortgage its the banks valuation that will matter not the estate agents marketing price.

For every new buyer entering the market there is 3+ new sellers at a time when the stock of properties for sale is allready higher than any recent year (most just sitting there as they are overpriced) and yes despite growth in both population and housing stock the number of sales are about 50% below historical averages.

If I owned a BTL flat in London , I would want to get shot of it ASAP.

The issue with the 'crash merchants' is that they assume certainty of doom and portray that as a certainty.

Nobody is saying that the market is in good shape right now. After a boom earlier in the year (which RSP appears to have vaguely denied but has not yet provided a source for their statistics concerning January sales), there is now a lull. But, this is equally explained by the end of the stamp duty holiday. For example, this graph showing the huge jump in March, the huge drop in April, and a small recovery in May. 



(Graph from: https://www.gov.uk/government/statistics/monthly-property-transactions-completed-in-the-uk-with-value-40000-or-above/uk-monthly-property-transactions-commentary--2) 

Clearly this is not a normal situation, and transactions and price data from around the end of the stamp duty holiday are unlikely to indicate a long-term trend. 

It has been mentioned before that RSP is a 'stopped clock', and of course house prices do go down as well as up. This has been mentioend. But, the sizeable crash that RSP predicts and has been predicting since 2007 (for those who know where to look) hasn't happened. Because it's more sizeable than will ever happen.

It's me that has posted plots from Plumplot, which I often do when estimating what a property might be worth given previous sales prices and the time since a property last sold. Looking at these, there has already been a real-terms price crash, in places like London especially. As is normal, in nominal terms the price change is typically less, though still notable in London. We don't know if that has deflated the market to a point where it will start rising again, or not. Nobody knows that. Then people risk missing a good opportunity (as RSP missed the post-2008 reduction in prices) because of bad advice. We don't know whether currently reduced prices (very significantly in London) are a good opportunity or not. But, they could be. 

What we don't know is what is going to happen in the future. And, the history of housing is of people making predictions that are proven wrong. Advising people whether or not they should buy/sell/whatever based on claimed certainty as to what the market will do in the future is not a good thing to do. People need to understand that the property market can't be predicted, and consider that uncertainty when deciding what to do. 

What happens in this forum is that RSP will make unsubstantiated claims based on 'the current market' which, no matter what the market is currently doing, are always to reduce price drastically 'still £100,000 overpriced', make ridiculous offers that won't be accepted, or to not buy and wait because in the near future houses will be much cheaper. These, e.g. the claim that sales in January this year were half the long-term average (which they weren't) then get rebutted with facts and figures, which then becomes 'debating house prices and the economy'. Which is banned in this forum. But, if you see someone in the forum misleading new posters who might assume that RSP knows what they are talking about, do we just let it be? It's not difficult to find RSP elsewhere on the internet and find the boasts as to what they are doing on here (MSE). As well as their long-term history and the consistency of their negative view, whether the market is booming or contracting.

As I said I think looking at the longer term picture is more sensible, especially if you are taking on a lot of debt or struggling to sell a house.

https://www.statista.com/statistics/290623/uk-housing-market-monthly-sales-volumes/

While we understand that mentioning house prices may sometimes be relevant to a user's specific MoneySaving situation, we ask that you please avoid veering into broad, general debates about the market,

ReadySteadyPop

N1_EP said:

RHemmings Thank you very much for taking so much time to explain more about forumites and flagging I shouldn't just assume all info her is faultless.  I appreciate it!

I am finding in general amongst the many voices the same thing is generally being advised which I find helpful.

Is the EA you are using managing to sell other houses?

RHemmings

ReadySteadyPop said:

RHemmings said:

Shadyocuk said:

Whilst ReadySteadyPop might have been historically biased, the property market in England in general is not looking in great shape.

Generally speaking prices are down and falling , both London area and flats being particularly hit due to ever increasing service charges. All the usual (biased) price valuation metrics are showing a fall.

small scale BTL landlords are trying to exit the market , the renters reform bill will only make this worse and given the state of the countrys finances you would not wont to rule out futher increases in capital gains tax rates.

I don't see anything happening between now and September that will improve the market , and by then the next budget is just round the corner. Even if the BOE cuts interest rates, Gilts and Swap rates are more likely to go up than down (Trump's new bill and our lack of a credible chancelor mean both the UK and the USA have to sell lots of new Gilts).

Most estate agents initally over value by at least 10% , if a buyer needs a mortgage its the banks valuation that will matter not the estate agents marketing price.

For every new buyer entering the market there is 3+ new sellers at a time when the stock of properties for sale is allready higher than any recent year (most just sitting there as they are overpriced) and yes despite growth in both population and housing stock the number of sales are about 50% below historical averages.

If I owned a BTL flat in London , I would want to get shot of it ASAP.

The issue with the 'crash merchants' is that they assume certainty of doom and portray that as a certainty.

Nobody is saying that the market is in good shape right now. After a boom earlier in the year (which RSP appears to have vaguely denied but has not yet provided a source for their statistics concerning January sales), there is now a lull. But, this is equally explained by the end of the stamp duty holiday. For example, this graph showing the huge jump in March, the huge drop in April, and a small recovery in May. 



(Graph from: https://www.gov.uk/government/statistics/monthly-property-transactions-completed-in-the-uk-with-value-40000-or-above/uk-monthly-property-transactions-commentary--2) 

Clearly this is not a normal situation, and transactions and price data from around the end of the stamp duty holiday are unlikely to indicate a long-term trend. 

It has been mentioned before that RSP is a 'stopped clock', and of course house prices do go down as well as up. This has been mentioend. But, the sizeable crash that RSP predicts and has been predicting since 2007 (for those who know where to look) hasn't happened. Because it's more sizeable than will ever happen.

It's me that has posted plots from Plumplot, which I often do when estimating what a property might be worth given previous sales prices and the time since a property last sold. Looking at these, there has already been a real-terms price crash, in places like London especially. As is normal, in nominal terms the price change is typically less, though still notable in London. We don't know if that has deflated the market to a point where it will start rising again, or not. Nobody knows that. Then people risk missing a good opportunity (as RSP missed the post-2008 reduction in prices) because of bad advice. We don't know whether currently reduced prices (very significantly in London) are a good opportunity or not. But, they could be. 

What we don't know is what is going to happen in the future. And, the history of housing is of people making predictions that are proven wrong. Advising people whether or not they should buy/sell/whatever based on claimed certainty as to what the market will do in the future is not a good thing to do. People need to understand that the property market can't be predicted, and consider that uncertainty when deciding what to do. 

What happens in this forum is that RSP will make unsubstantiated claims based on 'the current market' which, no matter what the market is currently doing, are always to reduce price drastically 'still £100,000 overpriced', make ridiculous offers that won't be accepted, or to not buy and wait because in the near future houses will be much cheaper. These, e.g. the claim that sales in January this year were half the long-term average (which they weren't) then get rebutted with facts and figures, which then becomes 'debating house prices and the economy'. Which is banned in this forum. But, if you see someone in the forum misleading new posters who might assume that RSP knows what they are talking about, do we just let it be? It's not difficult to find RSP elsewhere on the internet and find the boasts as to what they are doing on here (MSE). As well as their long-term history and the consistency of their negative view, whether the market is booming or contracting.

As I said I think looking at the longer term picture is more sensible, especially if you are taking on a lot of debt or struggling to sell a house.

https://www.statista.com/statistics/290623/uk-housing-market-monthly-sales-volumes/

Looking at the longer term picture is more sensible, providing that it's done in a realistic fashion. You are not doing anything like that at all. The OP is making a decision whether to sell their flat now or wait to see if conditions improve. They need to understand the risks of both sides of that equation. That they under-sell now and see the market recover, or if house prices decrease and they can't even sell for what they can now. Both possible decisions have risks. You claiming to know the future is not good advice. 

Your reference does not back up your claims. Check the actual numbers for the Januarys. 

N1_EP said:

RHemmings Thank you very much for taking so much time to explain more about forumites and flagging I shouldn't just assume all info her is faultless.  I appreciate it!

I am finding in general amongst the many voices the same thing is generally being advised which I find helpful.

All of us here have biases. E.g. I'm very debt averse. 

We have to remember that nobody knows what will happen in the future with any reliability. Anyone who claims to know the future with certainty are the first people who should be ignored. 

Herzlos

RHemmings said:

But, if you see someone in the forum misleading new posters who might assume that RSP knows what they are talking about, do we just let it be? 

I think that's the crux of it. They should have been banned long ago for the dangerous advice and numerous rules violations, but I feel the need to provide some context to prevent new users making bad decisions based on the bad advice. 

ReadySteadyPop

Emmia said:

N1_EP said:

Wow - I love this forum it is so helpful to have this range of voices. 

@poseidon1 you're absolutely right I am a londoner and yes I posted back in November when I wasn't sure if I should sell. A resounding yes from the forum helped me make this decision and feel it was the right one. You're right I did originally think i'd be getting £480k before estate agents came and valued it. they all pitched a lot higher so I ran all my figures from that. 
It's helpful to be reminded that selling asap is a good idea.

@RHemmings thanks also - it does sound like i am indeed best off dropping the price and persevering. I have £60k mortgage on the flat. 

@ReadySteadyPop - interesting you think 10% isn't really that much. I'm struggling with it as literally every penny counts. I have no pension so the flat sale is meant to kick start that. I planned to put £150k into a pension the rest against the house but now it will be more like £100k in the pension. i'm 46 so very late sorting this out and worried about it. I always planned that the flat would be my pension either by income or selling at the point of retirement but it seems that was no longer a good plan hence the sale. 

thanks for that stats link i'll check it out. 

thank you so much all - so helpful!

If you have no pension whatsoever I'd really start putting some money away into that as soon as possible rather than waiting for the big £150k dollop of cash that you "see" as a result of the EA valuations of the flat. 

Are you on track for your State Pension in terms of your contributions? Are you employed with access to a workplace scheme?

Always a mistake to make assumptions about how much a house will "pay out", it is not like a bank account or money market fund, quite the opposite in fact.

Emmia

ReadySteadyPop said:

Emmia said:

N1_EP said:

Wow - I love this forum it is so helpful to have this range of voices. 

@poseidon1 you're absolutely right I am a londoner and yes I posted back in November when I wasn't sure if I should sell. A resounding yes from the forum helped me make this decision and feel it was the right one. You're right I did originally think i'd be getting £480k before estate agents came and valued it. they all pitched a lot higher so I ran all my figures from that. 
It's helpful to be reminded that selling asap is a good idea.

@RHemmings thanks also - it does sound like i am indeed best off dropping the price and persevering. I have £60k mortgage on the flat. 

@ReadySteadyPop - interesting you think 10% isn't really that much. I'm struggling with it as literally every penny counts. I have no pension so the flat sale is meant to kick start that. I planned to put £150k into a pension the rest against the house but now it will be more like £100k in the pension. i'm 46 so very late sorting this out and worried about it. I always planned that the flat would be my pension either by income or selling at the point of retirement but it seems that was no longer a good plan hence the sale. 

thanks for that stats link i'll check it out. 

thank you so much all - so helpful!

If you have no pension whatsoever I'd really start putting some money away into that as soon as possible rather than waiting for the big £150k dollop of cash that you "see" as a result of the EA valuations of the flat. 

Are you on track for your State Pension in terms of your contributions? Are you employed with access to a workplace scheme?

Always a mistake to make assumptions about how much a house will "pay out", it is not like a bank account or money market fund, quite the opposite in fact.

That's what I was getting at