Is The Market Really That Bad

ComicGeek

In my local area (East Anglia) at the moment, 10% of houses for sale on Rightmove are over £2M. Most of those have been on the market for 6+ months. Houses are very unique at that price level, and frankly not lots of buyers - so buyers are able to be picky on details, looking for that property with the right mix of location, land, outbuildings, interior decoration etc that they want.

A few very individual properties at £3M+ have been on sale for more than 2 years... Personally I don't believe that they are overpriced, but definitely waiting for a very particular buyer. It's not necessarily about price at this level - it's all about the property features and what the buyer is looking for.

A few of my rich clients are making sure they are 'mobile' ahead of the budget, and have been renting for the last couple of years. Will probably keep renting or move abroad, so I do think the pool of buyers is dramatically reduced at the moment. 

monkey-fingers

ReadySteadyPop said:

Slinky said:

ReadySteadyPop said:

theartfullodger said:

Ask me in 5 years time and I'll tell you what the market position is this day today.  Any other response is a guess. 

Property prices have always gone up & down, different areas different, etc etc... The red-top myth that property always goes up is a lie.

best of luck

No they haven`t, we have had a 25 year run where they only went up (due to low interest rates and cheap debt) they tend to crash sometimes, not go "up and down". The credit conditions of the last few years are not coming back again IMO, so it will be very hard to keep going up this time.

If and when a 'crash' comes along, it's never going to wipe out 25 years of gains. 

You should research the 80`s crash, no one knows what is going to happen, that actually happened.

There was much more to the 1989-91 crash though. High interest rates. Market flooded with cheap council houses. Obviously the 2007/8 dip was also a one-off event.

Both were also caused by eager mortgages, given away in cornflakes packets.
Lenders are much more canny now.

And as an aside, I'll remind you of the graph.
https://www.propertyinvestmentproject.co.uk/property-statistics/nationwide-average-house-price/

House prices go one way Crashy. And they become ever unaffordable. 

I would say to anyone, if you can get on the ladder, do.

House prices generally mostly impact 2 groups of people. Those getting on the ladder, and those getting off. Those who own property are generally only interested in interest rates.

ReadySteadyPop

monkey-fingers said:

ReadySteadyPop said:

Slinky said:

ReadySteadyPop said:

theartfullodger said:

Ask me in 5 years time and I'll tell you what the market position is this day today.  Any other response is a guess. 

Property prices have always gone up & down, different areas different, etc etc... The red-top myth that property always goes up is a lie.

best of luck

No they haven`t, we have had a 25 year run where they only went up (due to low interest rates and cheap debt) they tend to crash sometimes, not go "up and down". The credit conditions of the last few years are not coming back again IMO, so it will be very hard to keep going up this time.

If and when a 'crash' comes along, it's never going to wipe out 25 years of gains. 

You should research the 80`s crash, no one knows what is going to happen, that actually happened.

There was much more to the 1989-91 crash though. High interest rates. Market flooded with cheap council houses. Obviously the 2007/8 dip was also a one-off event.

Both were also caused by eager mortgages, given away in cornflakes packets.
Lenders are much more canny now.

And as an aside, I'll remind you of the graph.
https://www.propertyinvestmentproject.co.uk/property-statistics/nationwide-average-house-price/

House prices go one way Crashy. And they become ever unaffordable. 

I would say to anyone, if you can get on the ladder, do.

House prices generally mostly impact 2 groups of people. Those getting on the ladder, and those getting off. Those who own property are generally only interested in interest rates.

So that is two one off  events? People who own property, unless they are selling, are generally more interested in the rate they get on savings, I assume you mean people with mortgage debt?

ReadySteadyPop

ComicGeek said:

In my local area (East Anglia) at the moment, 10% of houses for sale on Rightmove are over £2M. Most of those have been on the market for 6+ months. Houses are very unique at that price level, and frankly not lots of buyers - so buyers are able to be picky on details, looking for that property with the right mix of location, land, outbuildings, interior decoration etc that they want.

A few very individual properties at £3M+ have been on sale for more than 2 years... Personally I don't believe that they are overpriced, but definitely waiting for a very particular buyer. It's not necessarily about price at this level - it's all about the property features and what the buyer is looking for.

A few of my rich clients are making sure they are 'mobile' ahead of the budget, and have been renting for the last couple of years. Will probably keep renting or move abroad, so I do think the pool of buyers is dramatically reduced at the moment. 

Not really, this level was pumped up by cheap credit, a couple with a pair of  good houses to sell in the boom, well paying jobs, savings/family money etc. could easily leverage up to the 2 million mark, the problem is that when the cost of money starts to return to historical norms a lot of this property isn`t " 2 Million Pound Houses".

Herzlos

monkey-fingers said:

I would say to anyone, if you can get on the ladder, do.

That's the advice I was given at the time too and it worked out. Essentially house prices are always going to go up apart from blips where affordability/lending drops, so you're best bet is to just get on the ladder. 

Slinky

ReadySteadyPop said:

Slinky said:

ReadySteadyPop said:

theartfullodger said:

Ask me in 5 years time and I'll tell you what the market position is this day today.  Any other response is a guess. 

Property prices have always gone up & down, different areas different, etc etc... The red-top myth that property always goes up is a lie.

best of luck

No they haven`t, we have had a 25 year run where they only went up (due to low interest rates and cheap debt) they tend to crash sometimes, not go "up and down". The credit conditions of the last few years are not coming back again IMO, so it will be very hard to keep going up this time.

If and when a 'crash' comes along, it's never going to wipe out 25 years of gains. 

You should research the 80`s crash, no one knows what is going to happen, that actually happened.

Are you seriously suggesting that if the crash happened tomorrow, the average price would drop from £270ish K that it is now, back to the £80ish K it was 25 years ago. You're delusional Crashy.

I do remember the situation at the end of the 80s, I couldn't afford to buy then when the MIRAS changes pushed house prices up ever higher and out of reach. Changed circumstances let me into the market in that 90s dip, but no way would I sell my house for anything near that price now, and neither would anybody else.

WIAWSNB

To answer the OP's Q, around here it's seemingly 'yes'.
I wasn't aware, but was talking recently to a guy who lives on a nearby 'desirable' crescent of bungalows. Prices all way above £300k, even for 2-beds. Or were.
The one opposite him has been on sale for a year, price currently dropped to £275, with EA suggesting a further drop to £250k. 
No bites.
I guess the only bright side is that the purchase price of the next house should also be lower?

MeteredOut

WIAWSNB said:

To answer the OP's Q, around here it's seemingly 'yes'.
I wasn't aware, but was talking recently to a guy who lives on a nearby 'desirable' crescent of bungalows. Prices all way above £300k, even for 2-beds. Or were.
The one opposite him has been on sale for a year, price currently dropped to £275, with EA suggesting a further drop to £250k. 
No bites.
I guess the only bright side is that the purchase price of the next house should also be lower?

That's what I don't get about people wanting house prices to continually go up. Assuming a straight-line % increase across the market (even though we know that does not happen), if you are looking to up-size, I'd rather be doing that in a falling market, than a rising market.

Herzlos

The trick is knowing when the market is about to fall or rise. Most people just up or down size as they need it. 

ReadySteadyPop

WIAWSNB said:

To answer the OP's Q, around here it's seemingly 'yes'.
I wasn't aware, but was talking recently to a guy who lives on a nearby 'desirable' crescent of bungalows. Prices all way above £300k, even for 2-beds. Or were.
The one opposite him has been on sale for a year, price currently dropped to £275, with EA suggesting a further drop to £250k. 
No bites.
I guess the only bright side is that the purchase price of the next house should also be lower?

Yes, unless he encounters a "delusional seller", but the good news is that with demand obviously well down there will be plenty of choice and he hopefully encounters many more sellers willing to face market reality.