To worry about falling house prices

[Ll81]

They say prices in central London have been falling for a while and this is rippling out to the rest of the country. Also lots of talk about raising interest rates and they could also be another downward pressure on prices along with lots of EU nationals leaving.

Anyone else worried that falling prices may mean many that have bought in the last few years maybe stuck in ne?

I don’t know a huge amount about what is officially happening, all I know is my DM put her house on the market 2 weeks before the Brexit decision at £1,495,000 (big house in Surrey), and has only just managed to sell it for £1,345,000. Although it may have been overpriced initially, the house next door sold a few months before my DMs went on the market for full asking price and was a much smaller plot so I don’t think that was the case. So this has lead me to think the market (especially London and surrounding areas) is taking a nosedive!!

I think the price of houses is ridiculous.

A house in my road (one of the cheapest areas in SE London), three bedrooms (one a box room), mid terrace, tiny kitchen, in need of renovation (elderly owner - doesn’t look like anything done to it since the seventies) recently sold for slightly over £400k! My DH is a high earner and we’ve worked out that we couldn’t buy our own house from us if we needed a mortgage! Similar houses (extended) around here sell for close to £500k.

I feel sorry for anyone who will be left in negative equity but house prices do need to drop if people in their twenties are ever going to own their own home. My DD is more or less resigned to never owning a home of her own until DH and I die and leave this one to her and DS.

A new development has just opened sales nearby. A one bedroom STUDIO (so not even a real bedroom) will cost £310,000! Ridiculous.

Sorry but they do need to come down - prices are utterly unsustainable.

Not even in London here and a 2 up 2 down in shockingly poor condition sold recently for £350k - ridiculous

Your house is worth precisely one home. To think of it as anything else is foolish. It is not a guaranteed investment or or pension.

Prices are stupid. I do want them to come down. Of course I don’t want anyone to suffer by this, but it feels like it’s only housebuilders and banks who are profiting st the moment. I also want them to build more normal houses so people actually have somewhere to live .

Problem is if they do crash nationwide by 10% lots will be in ne and it will bring down the economy with them. If anything they should just stay as they are and have several years of wage growth

I definitely think that prices do need to drop, especially in some parts of the country, especially London and the surrounding areas. Prices are just so over the top. £300k+ for a shitty flat! Ridiculous.

Plus, I’m not really bothered if the price of mine has dropped because I’m not selling it.

I don't care if they fall and we lose out if it gives DC a chance to get on the housing ladder.

It’s the other way around L181

I would love to see them drop, ordinary houses (3 bed terraces) in my area are now on the market for half a million, crazy.
2 bed modern apartments (luxury!?) 250k and are anything but luxury.

I have a lot of cash in various accounts earning negligible interest and can't get a mortgage on a modest home so I pay 3 x the mortgage cost on rent.

I agree, a house is a home, a place to live and should not be viewed as anything else ideally.

Another one who agrees that house prices need to come down. The value of my flat has doubled in ten years. So now I'm stuck. Can't afford the leap to a modest size house and can't afford to free up this place for the next generation of first time buyers. The market right now isn't moving at all.

But it won't help anyone if they fall. Banks won't lend and cash rich people will buy them as an investment

Even if house prices fall, those looking to buy a home may find themselves even further from their dream of buying a home.

Banks will be a lot less willing to lend putting even more houses outside their buying range. Many owners will be stuck in negative equity, unable to sell or trade-up, and fewer houses will come on the market. Interest rate increases will mean higher repayments.

Well in the North West of the North West (hope that makes sense) house prices are increasing, the home next door but one to me is up for 100k more than what I paid for mine three years ago. Maybe it will take a few years for it to ripple out up here but for now I’m happy.

I do feel for people who've bought comparatively recently and may end up in negative equity. But overall I'm desperate for prices to come down so that my partner and I can buy. Some people have been treating property as a high interest investment vehicle for years and prices have been artificially high as a result.

Meanwhile we're chucking our money down the private rent drain, wouldn't get a council/HA property as we're not in immediate need (and rightly so), but because we can't get a deposit together we supposedly can't afford a mortgage even though payments would work out at significantly less than our monthly rent. We're in our 30s and already worrying about how we'll keep a roof over our heads when we're pensioners and private landlords won't want anything to do with us.

There won't be enough first-time-buyer homes if prices were to fall. Nobody living in them currently who had the average FTB-size deposit would be able to sell and move into the second-time-buyer homes. Then everyone is stuck. I don't really know what the answer is. A a bit of stagnancy would help.

I’m not planning on selling for st least 10 years so it’s pretty irrelevant. As for the interest rates rising, surely that’s something that you take into consideration before you buy, not after?

Banks being less willing to lend doesn't worry me -- we'd get a mortgage in a heartbeat by anyone's standards, we'd just been priced out of the area we'd settled in.

Moving out of the area would have meant losing one salary; not because my job doesn't exist in the rest of the country, but because we relied on our support network of friends and family. Losing that would have made it difficult for us both to remain in work, and one salary wasn't enough to buy elsewhere.

happened before, will happen again. Last peak 2006, big drop since then outside the holy city.

now too many people and not enough housing. Worrying will do precisely zero.

Negative equity's only a problem if you need to sell.

We bought (FTB’s) in September so there’s a risk we could be in negative equity. We didn’t stretch ourselves financially though and aren’t planning on selling any time soon so hopefully will be ok.

expatinscotland, negative equity also becomes a problem for a potential buyer as the owner cannot sell.

It was falling end of last year. We pulled out of our sale for personal reasons but will probably be looking to put it on again in 6 months.

We're leaving UK so drop would suck but house prices can't continue to grow. They need to at least stagnate.