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'm mid-30's, dp 40's, and we have resigned ourselves to the fact we will never be able to buy. We live in Cornwall where, unless you move to very deprived areas (and Cornwall has 10 of the nation's 17 mist deprived areas) rents are astronomical, about 75/80% of a single persons wage, there is very little in the way of council/social housing (some locals have been on the housing list for 15+ years) and house prices just don't reflect the wages...."affordable" houses being built on the hundreds of new estates that are popping up pretty much everywhere start at £250k...so not very affordable at all to the average person in Cornwall. I can only hope for a lottery win so I can secure the future of my son.

Yep, southwest can be included in the silly property prices bracket too. It’s hugely propped up by second home ownership and people moving out of London. Most of our local economy is low wage, so I have no idea how any normal locals buy.

I'm near the south coast, but in a town where lots of people commute to London. Prices here are falling quite markedly.

Houses like mine for changing hands at just a shade under £400k 12-18 months ago. They're now coming on the market at £350k and hanging around unsold for a fair while.

A house round the corner that had been extended was on the market a year or so ago for £525k and was sold quite quickly for £500k plus. A house that is identical apart from the wallpaper (the same builders did the extension and it even has the same kitchen units) is now on with an asking price of £475k. They're nothing special, smallish semis but with decent-sized gardens and I think the prices are obscene for what they are.

The tiny terraced cottages in the town centre have taken an even bigger hit though. They were fetching prices just shy of half a mill and how have asking prices that start with a 3. Anyone who bought one of those with a 90% mortgage over a year ago will now be in negative equity. I just hope it doesn't coincide with a massive recession and interest rate rises like it did in the early 90s, those were desperate times for so many people.

The correction in London/SE is desperately needed imo, but it will mess up our plans of moving away from the SE and getting something bigger that has income potential. Looks like we'll both have to work till we get our state pensions after all.

"Properties owned outright are more predominant in areas such as rural Wales where there isn't a shortage of housing.

In comparison, just 23% of London's households own their property outright."

That is a fascinating comparison - I didn't know those statistics were available! (Where are they published?)

If you then add in the fact that London mortgages are likely to be for a greater amount as well, the impact of an interest rate rise may be much greater on London property than in other places.

Yes salaries are higher in London and recent borrowers will have been subject to a stress test for interest rate rise, but in some cases their circs will have changed - couple will have had dc for instance - so an interest rate rise will have a significant impact.

I think some btl landlords are also now realising the impact of the tax changes and selling - there do seem to be more things coming onto the market at the moment. And btl landlords are less likely to take the "I'm not selling for less than it 's worth" approach.

I bought a 5 bedroomed semi in a leafy area 20 minutes from the heart of the city

Cost me £215K 3 years ago, is now worth £260

Surely that's a wind up?! £215k for a 5 bedroom house in a leafy area, near London too?

She just said the city. Could be any city. Like Newcastle or Liverpool

as someone who owns property in the South East, I've been saying for ages that prices have to go down. They aren't. Even this is just a tiny levelling off.

I hate to think what we will end up with if prices don't go down - the market is appalling.

I couldn't upgrade either because the price of an extra room has gone up so much.

It's ridiculous. All the redevelopment in the South East is mostly aimed at investors looking for somewhere other than a bank to park their cash.

earlier governments decided that property was effectively going to be for investment purposes and ordinary people will suffer.

Surely that's a wind up?! £215k for a 5 bedroom house in a leafy area, near London too?

There is more than one city in the UK.

‘The City’ is a specific part of London so just referencing that would suggest London although they obviously didn’t mean that

The City’ is a specific part of London

I realise that, I used to work there. I don’t think saying ‘near the city’ in about housing in the UK implies that that’s where she means though.

No not London.

In the Midlands where I am they're going up.

My house has increased by more than 50% in 6 years. I think house prices in my area are completely unsustainable and unrealistic. I wouldn't be overjoyed at a massive crash, however I could understand it if it happened. What is ridiculous is that my house makes more per annum than I do...

I'm in South Yorkshire. My house is worth today exactly what it was when we bought it in 2008. This is less than it was worth in 2007 at the height of the market but more than it was worth in 2009-2015. There are houses in parts of the region that still aren't back to their pre-2008 prices. So whilst I'm not bothered about prices rising, I can't say that a fall would be good around here. There's no shortage of affordable housing stock.

Everything is cyclical. A rising interest rate will impact on people with big mortgage who are not fixed. There will be negative equity and there will be repossessions.

@LyricalGangster - so has my small flat!

watching it out earn me is a bit stupid - I can't afford the next step up because of it, which is a point a lot of people don't seem to get.

Today 14:19 Twistinthenightaway

‘The City’ is a specific part of London so just referencing that would suggest London although they obviously didn’t mean that“

This really makes me laugh. How would you know that unless you live in London- tiny minority of the population?!

The City and the city don't mean the same thing.

Prices are going up in my town as its being marked as a new commuter town. All house listings have '53 minutes from Euston' as the first line. New housing estate even being built with its own station. Good for me being a home owner, bad for those trying to buy a house on local wages (especially a new build!)

The poster said "the city" not "The City".

I bet where you are is still too high a multiple of local median incomes though barbarianmum!

Houses round here start at 50k. They are affordable to those that have an income. The problem is, of course, the availability of secure jobs. Which a slump in the housing market isn't going to help.

“Yesterday 18:04 Evewasinnocent

I hope they do fall - and I live in London. In some areas they have already. Friends rent a new build flat in Greenwich - Cost to buy was £720k a year ago. The same flat can now be bought from the same developers for £380k!”

That never happened

The south west is terrible for wanting to get on the property ladder. The wages don't meet the requirements for house buying. It's full of second home buyers. Locals have to move away to buy a house

It's more likely just a natural correction, there is typically some kind of slum every ten years.