To just be so upset about house prices

[spuddy56]

We started looking in December after scrimping and saving for years and its got more and more out of reach with every passing week since then. We've had two sales fall through due to downvaluations, so not only did we need the huge deposit we had saved up for years, we needed 10k on top of that which is impossible for us. We are paying rent and have no family help. We viewed a tiny house that we love and has been on the market since beginning of April with no offers but the seller won't budge on the price. Based on one year of sold prices in the area its about 40k too much, even taking into account the 10% rises over the last 12 months. Theres just no way a mortgage company would lend that much. Been to view another one and it's tiny, has had no offers and is worth a lot less but agents don't think they will go lower. We've had to adjust our expectations down and down despite being what we thought were healthy earners. How are first time buyers managing to buy right now without help?! I'm so so upset at not having somewhere to settle and call a permanent home.

Down valuations are the future, the banks can`t risk it now with inflation taking off and cost of living spiking, a few interest rate rises should see sellers revising their expectations down by quite a lot. People who bought and stretched themselves during the stamp duty holiday are royally snookered I would think.

How did you see that online?

I still don't like the term down valuation. As I said, surveyors are qualified professionals who are making realistic valuations. The issue is estate agents, who aren't professionally qualified or regulated guesstimating asking prices.

No, I'm sure we'd all like better choices than these.

Which analysts? I've seen a lot of predictions of the market cooling but no actual drops in value.

@Beaucoup

Out of interest, what do you think will happen to the price of those new builds that don't sell in the next 5 months? Do you think they will still sell for current prices when help to buy closes?

Which analysts? I've seen a lot of predictions of the market cooling but no actual drops in value.

The Daily Telegraph, of all places. Not usually a media source that predicts these things.

Personally I think with the headwinds facing the economy, we're looking at house price stagnation. But what do I know, I'm just a random mumsnetter, like everyone else on this thread. If the professionals can't agree on what's going to happen, how would we know.

So what's your solution?

I bought what used to be a typical starter home in the northwest in 2004 for £80,000, a small 2 bed terrace with no garden in a fairly rough area. Had 2 kids while I lived there, spent over £15,000 putting in kitchen, bathroom, double glazing and central heating. Sold it in 2016 for £73,000. Zoopla suggests it's not increasd in value since. You don't know until you have the benefit of hindsight whether buying at whatever price is the right decision, but given the predicted house price slump I'd probably wait if I were in your position (then again clearly I'm not one to give advice since my first house purchase depreciated in value by almost 9% in 14 years despite a £15,000 additional investment...)

Can't count - 12 years.

Without HTB they wont be selling, but no doubt the government will come out with another "prop" to the housing market, difference this time though is that the bond market isnt on their side any more.

The only way to get any kind of decent house nowadays is through inheritance sadly...or a gift if parents are generous.

This is the problem now. To buy or not to buy is a gamble and buying a home shouldn't be a gamble. It's because the housing market is now a speculators market - investors, flippers, foreign buyers parking their cash, BTL landlords.

I'm buying now at probably peak prices. I'm not comfortable about it though.

The cynic in me wonders if the government don't want to be on the hook for depreciating equity loans. They've made their cash with up to a 40% stake in appreciating assets (up to now) Which analysts? I've seen a lot of predictions of the market cooling but no actual drops in value. and now they think the tide is turning?

Or through a correction in the market brought on by rising interest rates.

Ignore the last 4 lines of my last comment @DeadHouseBounce

Well they know that the current levels of debt required to buy dont work with higher interest rates so calling the tide going out isnt really all that radical TBH. It will take a few months to show up as problems in the property market though (price drops, nothing selling etc.)

What area are you thinking of and budget

maybe someone can find something in your budget

you say you stay in the area due to work /travelling costs

if you did move further afield to get a cheaper place the cost of extra travelling might even out

what are you looking at . A 2 bed terrace

do you need 2bedrooms

Could you buy a one bed place

what would be the monthly mortgage v cost of rent now

I think it's the help to buy equity loan thing that is due to end. I'm sure the government with either reinstate it or come up with another money making scheme to replace it. Help to buy schemes are great for the developers and in the case of the equity loan, also for the government as they get the benefit of rise in prices when it's repaid.
If HelpToBuy schemes were ever meant to help the people, they would not be aimed at new build only or involve profit going back to the government.

All the suggestions to cut spending on literally everything, move in with parents or live in a bloody van to save...it's all well and good saying that but the reality is not everyone can do those things.

And regardless, isn't it just totally awful that people have to go to such extremes to buy a place to live these days...people that have always worked, sought promotions, saved money etc. What sort of quality of life is it to live in squalor in a 'doer upper', move hundreds of miles away from family and friends or have zero social life for years? People like to play martyrs saying how they did it and therefore everyone else should be able to, but life can be depressing enough without all of that on top.

While I totally appreciate that it's harder now to buy a first home, the idea that it was a total breeze in the past isn't true. Interest rates in the 1980s were over 15% which is what led to the crash. No one could get a 3x salary mortgage. I was 32 before I bought my first tiny flat in a crappy area and that was after the crash. It still crippled me financially.

Your assumption on the government's desire to build housing is incorrect. This government have done more to help people buy housing than any previously with stamp duty holidays, first time buyer incentives and penalising through taxation changes landlords. Further they have relaxed planning laws and set very ambitious housing targets for all local councils. Then if the targets are not met they have given themselves power to devolve power and take control of lpcal councils bsck into central government.

Construction has however slowed this year and is expected to continue while materials costs are spiralling out of control, bricks have risen 20 percent since Christmas. Glenfell has restricted the use of cladding so the demand for bricks has also outstripped supply. Shortages in gas have been partly to blame, Construction always sees the fireg throws of a recession and comes out again first. The trade is battening down its hatches so outside of politics not much will start on site for the next year at least. And of course covid has created havoc too.

Not sure what facts you base your political view on this on, I'd love to hear I am in no way a blue supporter but can't resist rising to this as its smack in my sector.

Hey OP we're in the same position but with 2 dc in tow - we've scrimped and saved for the past 13 years and finally in a position to buy (mid 30s both working)

The houses are either do - uppers in okay areas (but at the top end of the budget and no money to "do up" - most do uppers need everything new - single pane windows, no kitchens, bathrooms have been half finished, needs new wiring, boiler, roofs need repairing or have no paper work for dodgy extensions- you get the gist) or liveable houses in awful, awful areas. We've spent years being incredibly careful with money whilst living in questionable rentals and just want somewhere we can walk into without needing to save and scrimp for another 13 years to make habititable. It's soul destroying.

We rent and I'm worried the rental prices are going to jump too. You're not alone and I'll be following with interest.

@Collinsro I'm so sorry that its the same situation for you. I feel physically thinking about it sometimes too. Lots of love to you both. Fingers crossed for a lottery win hey xx

@Wheatiewoo I'm so sorry it's the same for you too, its shit isn't it. We are also worried about rent increases 😣