Million pound houses

[thinking123]

So a house near me has gone up and sale and sold within two days. It was up for offers over 975k.

I am just so shocked. It's a perfectly nice four bedroom detached house with a nice size garden. The location is nice but not outstanding, the pics on Rightmove are very nice but again nothing amazing. It's not even in the catchment for the best school in the town.

How the hell are normal family homes selling for a million pounds. How can anyone hope to pay that sort of price.

Generally people have equity from a sale

many in London do it that way and end up with higher cost houses

Now that is madness

Peckham isn’t that much of a draw to go with that house

There's a house local to me that's just gone on the market for exactly 1million (don't know how to post a link)

6 bedrooms, 3 reception rooms, lots of land, stables etc and swimming pool.
I'm in Derbyshire, seems you get a lot of for your money looking at the house that was posted earlier up thread!

Agreed Marsha; and yet it sold (maybe not for asking price but still).

Prices are crazy.

A friend of mine downsized to a similar size house (3 bed though) which was just over a million! It's in an extremely sought after location, though. Think historical town, period house. Goodness though!

I think mortgage affordability is a bit mad at the moment too. I found a 40 year mortgage that would have given us enough to buy a million pound house (just, remember the £100k in stamp duty 😭) and it would have been about £2000 a month which is actually pretty easily affordable once we stop spending all our money on full-time childcare. Trouble is we'd basically be fully reliant on paying it off with an inheritance or downsizing and I'm not making my life decisions reliant on people I love dying on a convenient timescale.

I did see an interesting thread on here a while back about interest free mortgages being used by people with good equity. Basically they'd use an interest free mortgage to get up to the next rung on the ladder on the basis house prices go up enough to make it still profitable and then downsize when needed. The multiples affordable then are much higher and, frankly, terrifying. You'd need a big risk appetite!

@loveinthe90smaybe she sold it for £45k?I thought she’d inherited with my uncle & split it, it was rented out to students for a bit but they were a nightmare, hence selling it. She had a home & no desire to be a landlord so would have spent the money on other things she enjoyed. She died young so I’m glad she spent it.

@LizziesTwin glad for your mum she got some enjoyment out of the money 😊 💐

Agents nearby say the pre-2008 ladder isn't operating any more.

Yeah, it's really weird. Almost nobody buying those houses will be first time buyers, it's all about the ladder these days. It doesn't really 'pay off' till you either downsize or pass it on to your offspring after you die.

Bloody hell, that house in Peckham! The only reception room is a hallway!

Thank god I live in Wales... my house is huge and cost less than that!

But yes, it does seem to be the case that ordinary family homes are increasingly out of the reach of ordinary families in some areas.

Wow

That house would be about 180-200k Maximum where i am.

This is what 1.2 million would get you within about 10 miles of where I am.

www.zoopla.co.uk/for-sale/details/59851723/?search_identifier=0263110ed53904a3f7c997c45e05cacd

How can anyone hope to pay that sort of price.

House 1 - bought for £130k with an income of £40k (single,) and a deposit of £13k. Bought it in an undesirable, but up-and-coming neighbourhood. It was total wreck and needed lots of work doing to it- I lived in it whilst I did the work, using Youtube tutorials for most of it! Sold for £220k 5 years later when the neighbourhood up and came. That gave me equity of £90k in 'profit' plus the original £13k, plus the nearly £10k I'd paid off my mortgage so a total of £113k. And I had some savings.

House 2 - bought for £400k - £110k deposit, £290k mortgage - income was £80k (joint). Again, up an coming neighbourhood and seriously run down house. By then I had a child but we still lived in it whilst we did it up. Sold it 4 years later for £600k. Giving us an equity of £310k plus what we had paid off the mortgage and what we had saved up = £390k

We had at that point split up, so bought 2 separate houses, however had we gone on to buy another joint house, we could have got a mortgage of £647k, which would have given us a total purchasing value of 1 million. Our mortgage was with halifax and they would lend up to 5.5 times your income, as long as you passed the affordability checks. I personally felt that was nuts (mortgage would have been £2200 a month, which we didn't feel was achievable).

So I can see how it is doable. I wouldn't want to do it though.

It depends where you are buying. I have just done a rightmove search with a 5 mile radius of where I live. In some areas a million pounds will get you a spacious house but it will also only get you a one bedroom apartment (in the Royal Crescent in Bath ).

Obviously there are individual cases that will be different (extremely high earners), but to support the market wide increase in property prices over so many decades now, there can only be structural explanations.

Low interest rates have played their part over the last 15 years, but the trend goes back further and the scale is bigger.

Housebuilding is another factor. The kind of house you're talking about, nice four bedroom detached, nice size garden, nice location, probably build 70-100 years ago, etc is very very desirable. Those kinds of houses aren't being build in great numbers these days. Not with the gardens, not in great locations, and obviously with period features.

We're trying to build cheaper "affordable" housing, different styles, new locations, smaller gardens. For anyone looking to buy or upgrade into the £500-£1m bracket there just isn't enough property to meet demand and prices have gone crazy. There are some £750k-£1m new builds but they'll have small gardens, and not be in the best locations, so people will pay more for a 30's semi in a nice established neighborhood with 100ft of garden.

But the big one, passing down significant sums from generation to generation is more or less a requirement in many parts of the country these days. Grandparents bought houses in the 40's/50's/60's, lived modest lifestyles and those houses are worth a lot of money. Parents bought houses in the 70's/80's/90's, have inherited wealth on top and are able to hand down large deposit contributions whilst they're still alive.

Whatever the rights and wrongs of the system are, if your family is NOT playing this game, then then you and/or your children are going to find it increasingly more difficult. Because other families are.

YANBU - this is near us - £950k renovation project

It needs gutting (carpeted kitchen anyone?!) - I can't believe it's worth that. It's only been online 3 days - let's see how quick it sells.

The local secondary is a school that until relatively recently was a failing school and it's not even the nicest nearby village.

My late parents house in the South West sold for over 400k
it’s a 2 /3 bed Victorian terrace needs about 50k of work it’s right opposite a beautiful park
it has 2 outstanding schools within the catchment area and 10 mins walk to main station so you can be in London in just under 2hrs
Even so the prices are mental

Inheritance, savings, low mortgage rates, accumulated equity "bank of mum and dad"!

But especially inheritance and the bank of mum and dad

These will become a bigger and bigger factor as time goes on. Each successive generation will have the benefit of previous generations' housing equity to plough into the market along with whatever money they can raise themselves.

And this has an influence even before the previous generation dies. If people think they are likely to inherit a large sum then they will borrow more than if they don't think so.

It's bonkers. I'm single, living in a 145k house and will be mortgage free in a few years. People look at me with horror when I say I'm not using my equity to move up the ladder and just staying here. I wouldn't get a million pound house, but even the ones I could get, I just don't see the point. I don't need a bigger house, and just think of all the things I could do with that extra money. And the cost of upkeep too - I'd rather be able to afford a new kitchen/sofa/guttering when I need to, than having it all tied up in the house.

Can anyone explain to me why house prices are going up and up?
Surely there’s less people in the country with people going back to their original birthplace following Brexit and people dying off with Covid?
So where is the demand coming from? I live in the Midlands and within a five mile radius of my house there must be at least 20 building sites. So who is buying all of these houses?

Supply and demand.

UK population has increased and successive governments have failed to build enough housing to meet the increased need. Until they do so, house prices will continue to rise.

And with Covid, Ukraine and inflation all serving to reduce confidence in the stock market and savings, many eople believe that housing is a more secure place to imvest money.

Ex council properties going at that in our old village. They have such big gardens they just extend. More and more.

Chuba that strathleven house is insane! I love it.

Personally I was just lucky enough to buy in an area when it was relatively cheap, and have benefited from price rises and large amount of equity. Sheer luck (and age)!

Strathaven, sorry