To think that big house price falls finally on the way?

[qwertyflirty]

After years or price rises, in my area (edge of London), I'm finally seeing price falls of around 15% from peak.

Lots of evidence in recent months of house price falls starting and picking up in London/South East, and usually once they start here, price falls spread elsewhere.

House prices are down on average 17K since July 2017 in London. "The average price of a home for the capital as a whole was £471,986, down from a peak of £488,247 last July."

There is little the government can do to mitigate it this time round, as interest rates are already at record lows. All signs are currently pointing to the top of the market having been reached and prices about to crash.

Such as:

www.theguardian.com/business/2018/apr/18/london-house-prices-fall-average-uk

www.thisismoney.co.uk/money/mortgageshome/article-5733321/Beware-red-danger-signs-house-prices-Young-buyers-borrow-record-sums.html

www.theguardian.com/money/2018/may/12/house-prices-are-on-the-slide-where-will-they-go-now

www.independent.co.uk/news/business/news/house-prices-fall-housing-market-rics-survey-april-a8343561.html

www.propertyweek.com/finance/house-price-falls-continue-in-london-and-spread-to-south-west/5096455.article

www.theguardian.com/commentisfree/2018/may/10/celebrate-house-prices-falling-britain-property-values

qwerty not really sure why you're being so nasty to that poster, it's needless tbh.

I imagine that house prices will tank by 2020 especially in London and the South East, less people are inclined to move there what with all the crime stories in the media etc. It will take a while but i forsee a large correction in the housing market in London.

What you have to remember is that this wont really help that many people to move a £600k property now valued at £450k will mean that it will only effect the current owners who will not be able to sell without a loss in some cases so will be forced to keep hold of their homes and wait for the market to clime. If you look at the market since 1970 there has been growth but two big crashes, it appears cyclical and appears we are due another.

Completely agree freezer.

If it’s any consolation freezerfoodyum I think for the price you paid you won’t be in negative equity plus I’m assuming over the last 2 years you have been paying off capital.

I actually don't think we will either boom because I don't think house prices are going to tank (stall, fall a little perhaps, but not tank), I was just making the point that plenty of us who own would also be negatively effected by this.

We lived off pasta and lentils for 7 years living in a shared flat with 5 other people in order to save up our deposit, it's really quite disheartening to know there are people out there who would happily have us lose all that.

I don't remember anyone other than cash-rich BLT landlords who were able to pick up bargains, enjoying the last house price crash

so true!

I don’t think there is too little supply in London anymore. The supply is just overpriced and targeted as ‘luxury’.

Around the dock lands people have been struggling to sell their property for years - simply too much new stock is being built for there to be a buoyant market in second hand property.

I imagine the prices of new builds especially will have to sharply decline unless developers are happy for them to stand empty.

Sorry I haven't rtft, but wanted to add, in our east-anglian area we were told it is certainly a buyers market right now by our estate agent friends. We also experienced a strong buyers market as we went to purchase our first house, we were able to purchase a much better house on same street for same price as what more-run down houses went for in last 2 years. Having watched what house prices are doing in our new area, it does look like everything is now stagnating.

Also the difference in area is bonkers. In Islington where I grew up (in a council flat!), the size of flat we own in Lewisham would cost 850,000. Bonkers.

The housing market is a clusterfuck
It's very difficult to see a pain free way out of this situation

And stagnating, yes, but that's a very different thing to crashing.

Prices are rising where I live. They have risen a lot this year. I think they will fall after Brexit.

I think London prices are falling because finally people are realising that London houses are not worth the money. About time too.

RidingWindhorses

"All the signs are Brexit uncertainty impacting the house market."

Of course that is one factor. But it would be foolish to think that that is the only factor.

Other reasons house prices are due to fall are:

• affordability - house prices are now more unaffordable than even the peak of the market just before the last crash. In Kensington & Chelsea, house prices cost 40 X average earnings (yes, you read that right). In the SE generally, it's over 10 times average earnings. That is just unsustainable.

• changes to BTL making it far less attractive. The BTL market has largely taken the place of the FTB in much of London in recent years - that is not only set not to continue but is now reversing as many landlords sell up in advance of tax changes.

• changes to transparency of property ownership to attack money laundering - in recent ears, lots of property in London has been bought by foreign criminals. Proposed and recent changes to increase transparency of ownership make London and the UK generally a far less attractive destination for foreign criminals to park their loot. Thank goodness.

• decreased affordability for other reasons (inflation and increase in student debt). Future generations are somewhat less likely to be able to afford high house prices than current ones.

• falling property prices globally (also happening in other overpriced locations like Australia at the moment). This is down to a rolling back of QE and raising of interest rates globally in eg the US. There is likely to be less money chasing property globally.

I think London prices are falling because finally people are realising that London houses are not worth the money

They're not, but people forget that many of us were born and brought up here and have family and support networks here.

I chose to buy my flat when I could have got a house elsewhere because my mental illness meant it was really important for me to stay near family, and my mother can't move out of London because her job only exists in London.

DP's job also only exists in London really so even when we do move out it'll have to be somewhere in commuting distance.

We lived off pasta and lentils for 7 years living in a shared flat with 5 other people in order to save up our deposit, it's really quite disheartening to know there are people out there who would happily have us lose all that.

I don’t think anyone wants anyone to lose but plenty of renters who have also “worked out” are in this position we no hope of ever owning.

hard not out!

• changes to transparency of property ownership to attack money laundering - in recent ears, lots of property in London has been bought by foreign criminals. Proposed and recent changes to increase transparency of ownership make London and the UK generally a far less attractive destination for foreign criminals to park their loot. Thank goodness.

What recent changes? Solicitors have been obliged to undertake AML checks for years, banks have been obliged to undertake AML checks for years.

The government knows that there are more votes to be gained from those priced out than votes lost from those who stand to lose out from house price falls.

What evidence are you basing that on?

I don’t think anyone wants anyone to lose but plenty of renters who have also “worked out” are in this position we no hope of ever owning.

Why, though? Neither of us were on massive salaries. Neither of us had help from family.

I accept that if you are earning 12k as a dishwasher or whatever then yes, you are stuck, but a professional couple earning 25k apiece, say, ought to be able to save. That's what we were on.

There have been times in the past when lots of people have been in negative equity, including me. So I don't understand when people say the Government would not allow this to happen. When you buy a house, the value could go up or down.

I don't remember anyone other than cash-rich BLT landlords who were able to pick up bargains, enjoying the last house price crash

Not true.

My MIL bought a flat in the last 'crash' (well, more like temporary drop), in about 2012. She bought for 160K, down from 185K in 2007, so a drop of about 15%.

In summer 2017, an identical flat sold for 303K, so a rise of about 90% in 5 years.

She is not a BTL landlord.

In the crash before that, I know absolutely loads and loads of ordinary people who were able to buy places when prices fell.

In the period 1995-6, when prices were at rock bottom, I know loads of ordinary people who bought flats in London zones 2-3 for 60-80K (in some very nice areas eg Primrose Hill and Chalk Farm for 80K!). Not one a BTL landlord!

already taken
Who are the snowflake generation?

Mind you average house price where we live is £160,000.

BadTasteFlump

The government knows that there are more votes to be gained from those priced out than votes lost from those who stand to lose out from house price falls.

What evidence are you basing that on?

This: www.standard.co.uk/news/london/londons-generation-rent-outstrips-mortgages-for-the-first-time-in-over-a-decade-a3183751.html

And there's more recent evidence - I'll try to find it.

House prices and rent have gone up in our area of the NW, I was surprised that I'd gain about £25 p/m extra than last year, which in turn had been raised by approx £25. It's not huge, but in the NW on a 2 up 2 down that's quite a bit.
House prices are up about 10K on a small terrace.

OP, people aren't going to sell their investments, because that's not what you do.
Money in the bank can increase and decrease over time and the small print of possibility of gaining less than you put in, has put many off.
Investing in property carries no risks, unless you are forced to sell at a time when house prices are low.
They can only increase with time, unlike savings.