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.

I know EAs are hated but this isn't accurate at all. EAs are regulated if they are signed up to their governing body NAEA. And guess where the surveyors who carry out valuations find evidence of their prices..estate agents. They ask local agents for comparables so if its a 3 bed mid terrace home on an estate they look for comparable of those for sale. Then those that have recently sold.

Market trend rules the market nothing else. If houses are selling for market price, estate agents will value the next house higher than the last. If people are gazumping they will add more to the price. If low offers are coming in, they will manage sellers expectation and warn they need to reduce price or consider offers.

House builders analyse sales per sqf and then add a premium for new build desirability. When the cost per sqf comes close to the sales value per sqf they will deem the risk too high and stop.

This is what has happened to us. We live in Wales and during the pandemic lots of people moved here from more expensive areas and priced us out. I'm not blaming the people who moved here, as many of them were no doubt priced out of their own areas, but it's so unsustainable. Those buying second homes I have no sympathy for, however. If you're lucky enough to have one home at the moment I think you should count your blessings instead of making things so much harder for other people.

We were so close to buying too OP. We had to pull out due to a problem with the house in 2020 but now I wish we'd just bought it as home ownership seems a distant dream now. We have 1 and half year old twins and are having to consider moving back in with my mum to save more money and we have quite a substantial deposit already.

So sorry you are going through this too OP, it's soul destroying! Let's just hope house prices go down to a reasonable level soon.

I was like you a few years ago. House prices were just soaring and I was terrified I'd never be able to afford one. Luckily my parents let me move in with them to save and I bought my first home in 2007. In 2008 there was a massive crash and my house totally devalued.

I wish that I hadn't panicked and bought when I did. House prices can't go up indefinitely. Just hold on a bit and you may be surprised.

@Marchitectmummy

So what's your explanation for the difference in agent valued asking prices and surveyor "down" valuations?

As I say, demand is still outstripping supply so its unlikely in my opinion for house prices to drop, probably okve jobs are starting to be lost some plateau for a while.

Jobs being lost could end up restricting demand. You said jobs being lost in construction preceded jobs being lost in other sectors by about 6 months back in 2008. It could be that the construction sector is a harbinger of jobs being lost in other sectors, if the job losses are big enough then this could negatively affect the demand side of the housing market.

There are definite early signs of a market cooling, plus landlords seem to be jumping out which will increase the property available to buy but also put rents up. Unfortunately.

If you buy now you'll be buying at the top of the market, which is fine if you're planning to stay for a reasonable amount of time but if you're looking for a stepping stone you might want to think differently - eg buying something you can turn into a buy to let and move any equity into your next property.

I work for a financial management firm. A lot of our downvals atm are sellers who have accepted well over the asking price - one of my friends offered £20k over and the downval was £5k under asking. I don't know if we can blame estate agents for all of these.

Obviously EAs should be warning their clients that this may happen!

Think that's already been explained by DashboardConfessional

one of my friends offered £20k over and the downval was £5k under asking. I don't know if we can blame estate agents for all of these.
It's supply and demand.
My neighbours house went on the market for 290,000 it sold for 370,000.

They are as relevant as those running around like chicken little shouting the sky is going to fall in. Its not.
I don’t actually own the company that doing the £45 million transformation so it’s not my personal circumstances but as I say we need people, data architects, data analysts we can’t get them because other people have them therefore my conclusion is that these people are still very much in demand and Tech is not slowing down.

Theres a lot of cash floating around still in the market too.

Yeah I know of two big families who have been kicked out of their rentals because the landlord wants to buy now. It sucks for them as finding a big house for rent is impossible.

30 year plus mortgages and an average of 60,000 in deposit required.

There is definitely still a lot of cash around for middle or high earners, it's the average person who is fecked by the increased costs.

Canadian Investment pension funds are buying up lots of the property in Ireland tax free, my annoyance is the investor rents it out as social housing to the council for 20 years at 2000 per month after 20 years they'll sell up having made an obscene profit.

The government like the UK slacked on social housing for years throughout Celtic tiger.

The government has it arse ways.

They are as relevant as those running around like chicken little shouting the sky is going to fall in.

Elon Musk is very successful for a chicken little. But this is mumsnet and mumsnetters are always the experts. Much, much cleverer than the richest man in the world 😂

We have a viewing booked for one we absolutely love and would easily be possible for us to stay in for 15 years plus. Its affordable on paper but will probably get outbid so can't get my hopes up. Have all your fingers crossed for me.

Elon Musk Is hardly what would we would consider an intellectual Powerhouse

@TwinklingFairyLights but if you’re determined to have a recession you will have one let’s be honest, you can have your own little private one that only affects you because I can absolutely assure you it won’t affect Elon musk.

Fingers crossed @spuddy56

what is your budget and price of house

@Nothappyatwork

It's ok, we get it. In your little world, your £45 million project makes you super successful. More successful than the richest person on the planet (mumsnet logic 😂).

I'm not determined to have a recession, merely pointing out that there are headwinds facing the economy and it isn't all hunky dory. These headwinds are well documented but you may not have noticed them 🤷‍♀️. If you want to pretend it's all hunky dory because of your £45 million project then that's fine. Naive but fine.

Have you noticed petrol costs rising? Interest rates rising? Food costs rising? Gas costs rising? None of this will have any impact on the economy because your £45 million project is going well. Right.

*bought my first home in 2007. In 2008 there was a massive crash and my house totally devalued.

I wish that I hadn't panicked and bought when I did. House prices can't go up indefinitely. Just hold on a bit and you may be surprised*

l don’t agree with this. All the houses I’ve bought in the past have continued to increase in value. And unfortunately they can go up indefinitely. I bought my fist house in 1988 for £39k. It’s worth nearly 500k now. This was just a terrace in Chorlton in Manchester.

lt depends where you buy. After a divorce l bought a very small terrace in another city for 49k. It’s worth 250k now.

Bought my current house 9 years ago for 250k. Now worth nearly 600k.

lve never known property drop in price in any area I’ve bought in. It just continues to rise. Even in recessions they’ve just levelled or risen more slowly.

I can't see anyone running around like a chicken shouting that the sky is going to fall. I can see someone sticking their fingers in their ears and singing la, la la very loudly while ignoring all the facts.

It's not just Elon Musk who, love him or loathe him, clearly has something about him to be so financially successful.
Here are a range of articles from the mainstream media. Even the BOE is warning about recessionary risks as are various other bodies.

www.ft.com/content/5001ffb8-96d6-4e1a-a9dc-5ad4470930c7

www.telegraph.co.uk/business/2022/06/08/britain-brink-recession-covid-recovery-grinds-halt/

www.theguardian.com/business/2022/may/12/a-uk-recession-seems-certain-the-only-question-is-how-deep

www.thetimes.co.uk/article/sterling-s-fall-reflects-harsh-reality-that-outlook-for-uk-is-deteriorating-n5b862593

Unfortunately, all discretionary sectors, which includes tech (note some of the massive stock market falls in the tech sector) are at risk.

@Blondeshavemorefun technically our budget was 300k but if we drop to a 10% deposit we could go higher, and it should still be fine from an affordability pov. The house is 325 and I imagine will go for 340ish. It would be worth 340 to us and we could easily meet the monthly payments as they are the same as rent but just need a mortgage company to agree.

It is wrong that banks can’t see that you have paid x amount for years for rent and that a mortgage would be less monthly