AIBU to be gutted my house has lost me money?

www.rightmove.co.uk/house-prices/nw3.html?searchLocation=NW3&useLocationIdentifier=false&locationIdentifier=&propertyType=FLAT

if you look here you are definitely not alone.

Yes, I think it's the triple whammy of lockdown, the cladding scandal and more remote working. Possibly also greater awareness of how leasehold and service charges can really fuck people over.

We very recently had a situation where lots of people were functionally excluded from outdoor space if they didn't exclusively occupy it, and many more had their access severely limited because of fear, policing and social shaming. It didn't matter how many amazing parks you were near, you were still worse off in that respect than someone with the smallest, scrubbiest bit of yard that was theirs alone. Even people in flats with access to decent shared space sometimes had their access to it curtailed, either through their own fear or the behaviour of those around them. The memory of that is going to be influential for some time.

@Hotpinkparade I know people who bought & after 5 yrs sold for less so it could be worse.

Victorian conversion flats have definitely increased in value in the past few years

It really depends on the area

Flats are not all the same. Victorian conversion flats have definitely increased in value in the past few years, blocks with restrictive leases, high services charges and cladding issues obviously have not.

With an ungrateful attitude you will always find ways to feel disappointed by life. You’ve had unbelievable luck compared to billions of people. You should focus instead on increasing your income through your work

Let me find my tiny 🎻

Oh come on, you do your research. Who do you think tells other people?
The reality is it’s easier to spend money you didn’t work for. You made a the choice to buy a costly flat and only own half. You could have bought a terraced house in most of Z 3 and half of zone 2 for 500k in 2017 which would have been a much better investment.

The fact that you didn’t do any research on the property market, the area you were buying in or expected growth shows you absolutely wouldn’t have somehow made £200k from misc investing.

The lack of growth in values seems right for a flat in London.

The growth has been in houses

And yes you have lost money in real terms (i.e. adjusting for inflation)

Should you hold on ? Probably not as that would require either dramatic fall in interest rates to drive another boom or massive leap in productivity to drive real wage growth

Neither are likely

Flats have a bad reputation currently with management fees and cladding issues, hence have nose dived in popularity.
Just sell it and forget about it.

it's also the increased utilities, bills etc

It is low wages. The houses are too expensive relative to average person income - well at least in London.

Wages were low when we had low interest rates but no one really noticed. Interest rates have had a big impact

Bit you would not have that money as you would have spent it on rent if you didn't buy your own...

If the trust you paid rent to is overseen by your dad, presumably your rent hasn’t disappeared? It will eventually go to you or another family member who is the beneficiary of the trust - ?

Anyway. You spent £312.5k inheritance on the house and lived in it for a low rent for 8 years. Because this rent was low, you could make certain life choices eg your partner returning to study. Because you owned the house, you could do things like put in a new bathroom.

Money isn’t a goal in itself - it gives you options, and you have used those options, which is great.

You initially compared two different things

But you have now edited the post

Where would you have lived?

Also investments don’t track inflation.

If you’d invested £625k in a FTSE tracker on 1 April 2017, and cashed it in yesterday you would have cashed in £668k, about a 7% increase.

So if you sell for 5% more than you bought for, you’ve actually “lost” £12k but had below market rent housing for 8 years. So it’s cost you £12k to house yourself (plus any rent you actually paid) - the equivalent of £127 a month.

Now that’s not really a loss, is it.

London flats have done very badly since Covid.

i bought one for my son in 2023 and my solicitor advised me not to.

there are massive massive issues mostly around cladding, and leasehold which are causing a lot of legal problems in the conveyancing. Many people are not buying them.

not to mention the whole post covid flight to rural areas and shift to wanting outside space.

i bought it anyway and my son now lives there and he plans to stay for the long term (20 years plus)

many London flats have had actual falls in price and are completely unsaleable due to cladding so you’ve actually done quite well.

House prices go up, down, or stay the same. I’m on my fifth house and not expecting to make a profit when I sell it.

Interest rates. Kind of another side of the same coin.

But since 22 interest rate rises have really knocked the stuffing out of the housing market.

NW3

https://www.tiktok.com/@mubi/video/7332163671797386529?lang=en

Developers are building thousands of flats. New ones are sold complete with white goods and a nice kitchen. It tore the arse out of the First buyer market and damaged some of the second.
It even affected the price of our house when we sold because of the new builds where we were in East London.

You could have spent £50k in rent though!!! Don't be daft!

It sounds very much like you overpaid when you bought. Nobody needs to have told you flats don't hold their value in London (except specific postcodes, of which NW3 isn't one unfortunately) in the way that houses do. You have to educate yourself. Especially before spending hundreds of thousands of pounds, and before living in that expenditure as a primary home.

Anyway, you are where you are. There's a sunken cost theory, or you can stick it out. In your shoes I'd take the long, long, long term view. You'll buy/sell at least one more time in your life in all likelihood. And do more research before you make the next move!

I sold a flat in zone 2 last year- bought for approx £300k in 2018, full refurb including new kitchen and bathroom while living there, and then we sold it for about £312k in the end.

The facts are- flats were overpriced around the time we bought, and since then there has been a pandemic and a lot of tightening up around lending on flats in London, so they simply are not desirable anymore. If they are, then FTB want new builds, because they tend to have brand new leases and developers often offer 5% mortgages because they have the capital to be able to.

In addition, the days of property being guaranteed profit are sadly behind us (not in all areas, but in a lot of them), so buying a property assuming it will make you money is misguided. Buy somewhere you want to live, anything else is a bonus.

I understand you're disappointed (I was too) but you need to reframe your thinking otherwise it will eat you up.