To think a house price crash is definitely happening

[JudesBiggestFan]

I'm seeing house prices drop down and down before my eyes.
We
sold our house at 30,000 less than asking a couple of months ago but the chain has now fallen through. Three months ago our buyers sold, it fell through, they relisted two weeks ago at 20 grand less - so 275000 instead of 295000 and one viewing, no offers so far.
So we're all on hold, but I know they now won't sell at that price as first time buyers in this area just can't afford that. Every day I am seeing houses on Right Move that are hanging around for months or being reduced again and again.
I feel like the market hasn't caught up with interest rates...people just don't have the cash needed for current house prices and high interest rates on top but sellers are reluctant to reduce. Feel really stuck - we need to move for work reasons but the market is the slowest and worst I've known. Is it the same everywhere?

A lot of landlords are selling up in my area, they feel pushed out by too many regulations in favour of tenants and not being able to evict bad tenants easily. This is where the new housing stock is going to come from.

Nothing for sale here... anything that comes up is sold in hours or not even going onto Rightmove. My friend house sold for over asking price and over 10.offers...in 48 hours and the house she buying wasn't advertised.. midlands area

Define "crash"...

Prices are definitely coming down. There's a big gap between buyers' and seller's expectations so transactions are taking a lot longer to get done and the fact lenders are becoming more cautious and people can't borrow as much is fuelling this.

I think we're going to see prices coming down for sure. I'm not sure we're going to get the kind of "crash" we saw at parts of the American south and west in 2008/2009 with prices falling 30% plus. The situation with housing stock and the fact that property is still, despite everything, a relatively safe investment, will keep some sort of floor on it. I think people imagining they are suddenly going to be able to buy London property might be in for a nasty surprise.

Houses are mixed here - a few sell quickly - mainly 3 bed family homes - some sit on the market - usually because they are over priced or unaffordable

Fuelled here by the building of hundreds of new builds (4 new estates went up last year) - mainly '4 bed executive detached' with a few 3 beds and semis - all hugely over priced - people moving into them are putting their price up as a consequence - for example my house (1970's 4 bed semi) was worth around £230,000 a year ago - now probably £270,000 but a 'new' 4 bed semi would cost about £325,000 - mad really as I paid a lot less 8 years ago!

I actually think the impact will take years to play out. More FTBs leaving London, fixes yet to end, less equity, etc.

Yes defo slowing but I haven’t seen many sellers realise this- houses reducing and reducing but not reducing by enough. People need to clock their homes are worth less.

Are you in the north? You may be beginning to be hit by millennials from the south east wanting to buy affordable homes. A 4 bed semi for £230k would be unheard of. With remote working no one needs to stay near an office anymore.

Not sure about a crash, more of a return to pre COVID. So for areas that had a massive spike, yes you could probably call it a crash but given it's unlikely that many houses bought in the last two years will be those up for sale, they are likely still selling for more than they were purchased for.

In areas where the boom wasn't so obvious probably less difference in price but a very slow market.

I wouldn’t say a crash but things are falling but they’ll start to plateau as interest rates starts to plateau.

House has just hold on my street for 1.7 million. It was sold a year ago to a developer for £800,000. The developer spent £600,000 on it. Still made £300,000. I think it depends on the area.

@AlltheFs totally agree with this. @JudesBiggestFan there’s definitely a bit of a pause on prices rising but can’t see there being a monumental crash.

Rising interest rates have put the brakes on the housing market. It’s definitely slowing but it’s not a crash.

Not a crash no. Softening that does not apply to desirable hours and areas.

There is quite a lag in house sold price data so it won't show through in data for a while yet. I dont think they are crashing as such, just going down slowly over a long period of time. That has been the case in previous downturns.

I see similar homes up for about 30k less than last year, but the price was beyond ridiculous in the first place.

It's much needed to be honest, but shit for those in negative equity.

If you factor in inflation they have gone down a lot already before any nominal falls are accounted for.

It will be interesting to see what bank interest rates do. They are having to drop them because too few people are getting mortgages. Interesting times.

I bloody hope so. We can’t afford to buy because of the rates coupled with very high jouse prices - despite earning well.

It's a pointless question because people's definition of a crash varies.

For instance in my area I've seen some places down 15% since early 2022. Is that a crash? Some people might say it is, because in £ terms its a lot of money. But in other peoples terms 15% is not a massive percentage and the peak was artificial.

I can appreciate both points of view. I can also appreciate that in some areas prices have not fallen at all, and could even be rising.

What I don't get is that any thread like this always descends into people arguing yes or no, despite there being no official definition of what is a crash, thus both sides can be right.

Then there is the classic 'prices have done X near me, so your experience can't be true' people.

The bears are idiots for sure, but I can say some of the bulls are equally as denying of reality.

If you factor in inflation they have gone down a lot already before any nominal falls are accounted for.

Good point, if you adjust for inflation many will have fallen.

A house bought for 900k in 2021 should be over 1m today allowing for inflation

I think prices might be falling.

But not a crash yet.

Yes definitely dropping - SE London

Sunak is trying to force a recession. Not really something for most people to relish.

A correction rather than a crash I'd say.

I was a FTB in 2008-9. First mortgage 4.38%. One bedroom flat still cost me £210k (London). As soon as prices become a bit more reasonable, the market becomes more competitive. There isn't enough good housing stock in this country, that's what would help make prices more affordable

People have been told for years that house prices will always rise and home ownership is a good thing. That is true if you buy for the long term, for a home, and don't over commit yourself in the process. Not everyone has done or been able to do this, which in my view will lead to more forced sales in the next 3-5 years.

We’re sitting it out too - sellers need to be realistic and drop their prices. Often are vastly overpriced in comparison to average salaries!

Most people will decide to stay put is my best guess. It will soon rally.

London flats without outside space have definitely suffered. I've seen a few sell for the same or similar to what someone paid a few yrs before.

I hope not our kids need to be able to afford somewhere to live and they are vastly overpriced in comparison to earnings. It’s not sustainable I am afraid