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Original poster

House prices up or down?

60 replies

questionname · 05/11/2006 23:15

OK I've name changed for this sorry.
Having a really bad time trying to buy somewhere to live, soaring prices (by my maths recent buy to letters are loosing money) very little available and problems with what is. Have had several places under offer this year and vendors keep pulling out 'cos they can't find (?afford) the next place and we don't know what to do. We can't move to cheaper area right now (various reasons) so that's out. I know none of you have a crystal ball but would value some opinions, are prices going to keep soaring? Should we just get interest only mortgage? (no big wage rises in the offing!)or is everyone feeling the pinch? do you reckon prices might fall? How many interest rate/council tax/fuel rises will it take? Any estate agents out there who know the answer?

OP posts:
MrsDoolittle · 07/11/2006 16:12

I'm with you UCM

TheBlonde · 07/11/2006 17:32

I think if you want to buy you'll just have to keep plugging at it

It took me a long time to buy my first place with many goalpost changes in the meantime

If you can't compromise on area then you may have to reduce your size/condition requirements

Are you finding the estate agents helpful or a hindrance? Good ones should be keen for their commission and help the deal to happen so to speak

Blu · 07/11/2006 17:54

Carmenere - we decided to go ahead and sell before HIPs and before the pre HIP rush! And a friend of DPs who is training to be a HIP inspector or surveyor or something, came and had a look at our house and pointed out about 15 things that would be picked up in a HIP! But haven't been reported in the standard survey.
I know 2 other people who have done the same as us, too!
We had other reasons - but it was a factor that motivated us to get on with it.

Carmenere · 07/11/2006 19:07

Yes but Blu the hooha about the HIP was caused by the Home Condition Survey and they have now scrapped that bit, rendering your dp's mates training useless which left a lot of people pissed off.

Blu · 07/11/2006 20:20

Ooops!
When did they do that? he was still being trained in August!!

Original poster
questionname · 07/11/2006 23:53

MrsD you've just made it again!
The Blonde we "chose" this area because it was affordable not because it is
a) especially nice (although it is better than where we are now)
b) safe (although ditto)
c) has good schools
Size wise it allready means everyone in the house sharing (incl me and dh ) if we go any smaller I think we would then officially be living in poverty!(not my definition but I believe we would fulfil gov criteria) we are not expecting a spare room/conservatory/2 bathrooms etc etc. We have avidly looked for wrecks as well but no joy.
I can talk the hind legs of a donkey about estate agents too but the words liars, cheats and just sit back do f%&k all and watch the cash roll in are leaping to my mind at the moment.
Interestingly (for us perhaps not the rest of you!) we had real problems last time because we have children, kept getting turned down by landlords the agents did get a bit annoyed then admittedly it made them look like idiots and they clearly weren't dealing with professionals.
I'm sorry about your mate Blu like I said I think generally HIPs are a good idea but all the bite has been removed if people know about the damp etc they can go in with their eyes open but now they wont be able to. The cost of searches will I believe be shoved onto vendors then there will be an energy efficiency report which again I fear will be a waste of paper. I think a lot of people have wasted money on training which is now useless!
Any more views?

OP posts:
TheBlonde · 08/11/2006 09:23

bumping for you

granarybeck · 08/11/2006 09:51

Questionname, we are in a very similar situation, and trying not to panic! We are not in London, but in expensive commuter town just out of london. We have sold our house and are having to rent as we can't fin a house to buy (that we can afford!). Estate agents told us that prices seemed to be settling at the end of the summer. But we can now see that they are definitely going up (in very big chunks too). Also there are so few houses on the market that lots of vendors are saying offers in excess of which is forcing prices up further. We are just hoping to find sommething very soon before they go up another chunk and we really will not be afford to buy something that will just fit our family in (no extras). Having moved from the north where houses are about a third of the price it seems even more ridiculous!

mumfor1standfinaltime · 08/11/2006 09:54

Hope they go down soon as house prices imo are so unrealsitic that it is taking the p*ss.

A 3 bed terrace where I live can reach £235k and thats without any parking! I'm sorry but for that I would want a bloomin garage!

granarybeck · 08/11/2006 10:02

Mumfor1, wher we've (perhaps stupidly!) moved to, there are 3 bed terrace style semis for 'offers in excess of 450'!! It is crazy and surely can't keep going up and up!

justaphase · 08/11/2006 10:18

We viewed a 3-bedroom terraced house in appauling condition last weekend. Estate agent said "it is definitely not for the fainthearted" which tells you all you need to know. No garrage. The tiniest of gardens. You had to walk throught the (only) bathroom to get to the kitchen.

It was on the market for... wait for it...

... £540K ...

The agent said they put it on for £640K 6 months ago but did not get that many offers

This is in London SE10 btw.

BexieID · 08/11/2006 11:49

The main reason I moved to Scotland was so we could afford to buy. We plan to rent for about 2 years first. Our 2 bed flat is £250 a month and where I moved from it would have been £600 a month to rent. Big difference. The same with house prices as well. How is anyone supposed to get onto the property ladder when they keep going up?

UCM · 08/11/2006 11:58

When you think that for ever 1% rise per 100k, your mortgage payment will be 65.00 more per month, it makes you think really.

So a 300k mortgage would go up by 195.00 per month if the interest rate rose by 1% and you are on a variable rate. Tis shocking.

LIZS · 08/11/2006 12:14

I'm debating whether we'd be better off selling and renting short term with a view to buying next Spring/Summer rather than rushing to buy now. If interest rates rise surely property prices will flat line for the first half of next year at least . btw when is the next Chancellor's speech December or March ? I'm wondering if the Stamp Duty thresholds may rise which could have an impact on property currently priced just below/above.

Mumpbump · 08/11/2006 12:15

I think the house market in the South East will remain buoyant. You only have to look at the apartment blocks they are building around green belt areas to see the demand for housing. Plus the EU seems to be ever-expanding so there will only be an increased demand from immigrants. Very dodgy to opt out of the housing market in the expectation that it will fall.

We bought in May 2005 and were a bit peeved 'cos we thought that we'd bought at the top of the market (there was a mini-slump shortly afterwards), but I'd rather do that than end up priced out. Being risk-averse, I would never voluntarily opt for a variable rate and HSBC in fact did a 7 year fixed rate.

Mumpbump · 08/11/2006 12:17

And then you have to factor in assisted housing for key-workers, five times salary mortgages and the one in the news yesterday for 125%, all of which will probably drive the market up. I doubt interest rates are going to impact much unless they get really high. They haven't been that effective so far!

justaphase · 08/11/2006 12:33

I would not gamble on the housing market... seriously.... unless you are rich enough of course.

I work on a trading floor and believe me it goes against every rule of risk management.

You may get lucky of course but it is a really bad trade.

twoisenoughmum · 08/11/2006 12:59

Justaphase - why not buy in lovely London SE22? A small 3 bed terrace that needs some work would sell for just under £400k here, I think. For £540k you might just about be able to get 4 bedrooms. And it really is a gorgeous place to live...

UCM · 08/11/2006 14:58

Mumpbump, I have to say I am a scaredy cat with risks now I have kids and I have plumped for a 10 year fixed rate at 5.08%. Ok, so interest rates might not go above 5.5 for the next 10 years, BUT having had a property (my first flat) when they were 13%, I just wanted to know I was safe. If they went up to 7% I would have trouble paying TBH.

UCM · 08/11/2006 15:01

The only person I could honestly say 'buy' to right now, would be someone who is buying a house as a family home with a view to staying put for at the very least 5 years. Ok, so the market might slump, but if you are staying in your house for ever, you won't notice. It's like all of the poeple who have 1000's of equity in their properties at the moment, like me. So what, I am not moving so it means absolutely bugger all.

Hideehi · 08/11/2006 17:36

Interest rates are the key, Australia's crashing, USA is crashing. We're next can't give you a date though, wish i could.

Original poster
questionname · 09/11/2006 08:08

Thanks for bumping couldn't get on here yesterday. Justaphase do you mean you wouldn't buy at all or just now? (loved the bit about it being a really bad trade!) Hidee hi I wish you could tell us when and I wish you could tell us just how much interest rates do need to climb, if you do some sums and play with the figures it can be quite frightening!
Just need to persuade myself to stop looking for a bit after all no one sells a family house close to Christmas do they?
Have a nice day everyone

OP posts:
justaphase · 09/11/2006 08:25

No, that's not what I mean.

If you are buying a house to live in, that's not a trade. That's just part of life. Presumably you will be living in it for the next 10 years or so and if you sell it will be to move up or down the ladder but you will be buying another house which will have moved in the same direction. More or less. Of course it is nice if prices are low when you are upgrading and high when you are downgrading but you can't fiddle with your life cycle so it is difficult to play this.

If you are selling your home and renting in expectation that house prices will fall and you will buy cheap, that's a gamble. You may get lucky and make lots of money or get unlucky and lose lots.

It is a bad trade.

Do not gamble what you can not afford to lose.

Only play the market if you have some advantage over the other players.

The small investor always loses.

If you want to do it with your second house, fair enough. But do not gamble with your HOME.

Bad trade!

Original poster
questionname · 09/11/2006 08:27

ahh so you were talking about my spare house!

OP posts:
pacinofan · 09/11/2006 12:17

Don't know about whether house prices will fall/stay stable - but I know this. The housing market is freezing up where we are (Cheshire/South Manchester). Nothing coming on the market, we are stuck, literally, in rental unable to move, or at least to the areas we have selected with good schools.

Desperate, me? You bet!

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