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Original poster

House prices dropped again in July

79 replies

OlympicRelay · 01/08/2012 07:23

I was just watching day break, its not looking good. There was a couple interviewed in the Midlands, with a lively home, they can't sell, its been on the market for two years despite a £50k drop in sale price.

The expert said the problem is vendors have a block on what they will accept in this falling market and they aren't realistic about the true value of their homes.

I am looking at the moment and I have found the same issue very low offers on my home and over priced houses to view. You just have to suck it up like I did.

OP posts:
yellowflowers · 02/08/2012 18:04

In our area, a crap bit of London known for riots, houses seem to have gone up. What was 250k a couple of years ago now about 300k. But London market is different I think.

BlueMoon74 · 02/08/2012 18:08

We need to relocate - we're having a baby, currently live in a top floor apartment (no lift!) 3 flights of stairs up, no family/friends at all where we live, and cannot afford the £800+ a month it would be for childcare.

Thought about renting this place out and renting where we need to be, but too far away to sort out any problems (4 + hr drive) and have been stung big time before by tenants ( last time I rented it out, 3 yrs ago, tenants trashed it, and it cost me £900, and my own time with my dad to put it back to how it was before we let it out - and this was through a reputable estate agent!!!)

OR we sell this place (being hopeful) and manage to buy something where we need to be - I'm worried we wouldn't get passed on the mortgage because taking all things into consideration now, the current mortgage we have would be too high on the value of what we could actually now afford (if that makes sense)Confused Feel very very shafted! Don't actually know what to do for best if i'm honest!!!

noddyholder · 02/08/2012 18:10

I wouldn't let it unless you are in for the long haul and can guarantee rental. 120k may be ok as maybe next year it will be below 100k. Letting and waiting is ok in a rising market but not in a recession.I would stay put or try offers over 120

noddyholder · 02/08/2012 18:11

Sorry didn't see that! Can you port the mortgage? Is the new area cheaper? If you can break even with even a little bit of savings I would relocate rent and save and maybe buy again in a few years

BlueMoon74 · 02/08/2012 18:17

yeh..this is what I'm worried about..that it will continue to drop quickly than the amount of mortgage I have left!! ie. be only 'worth' say £90k in another 2 yrs! I can port the mortgage, new area isn't cheaper, about the same if anything a little bit more expensive (and certainly no issues with the market down there). I thought about just cutting our losses, sell this now, rent down in the new location and save like mad for a couple of years to get a decent deposit together. Then get back on the ladder once the market is even lower. buy a house that will do us for the foreseeable future.

noddyholder · 02/08/2012 18:21

That is what I would do in your situation and have been buying selling and renovating for years I think its smart and you will get something better

internationalvulva · 02/08/2012 18:50

If you can find a decent long term rental then it makes a lot of sense. I'm nearly 40 and have never bought due to circumstances, mostly missing the Market before it went crazy. We really did our homework and decided that investing at any point in the last 5 years was absolute madness for FTB's so we didnt. Our friends and family told us we would never get our feet on the ladder, that we had missed our chance, that we were crazy...I'm just so grateful that We stuck to our guns and had faith on one another.

Needing to buy your own place is a very English thing, a lot of Europeans never ever buy. I feel that house buying has moved from being a considered financial investment to a 'do it at any cost' madness which has gripped our generation. It is keeping up with the Jonses gone mad.

So many people were chasing a 'doer-upper' to make a quick buck, long after all those types of properties were sold (usually to developers). So many of our friends who bought talked about adding value to their property but did about a hundreth of the research into long term financial trends and global economies and their likelyhood of success as they did into home decor magazines. Making money on property looked so easy from the outside, but as with any other gamble it only pays if you can stand to lose your initial stake.

I've experienced a lot of snobbery from people who found out we rented in the past, but a lot of the same people are now in negative equity facing huge repayment rates when interest rates rise and will possibly lose their houses and their credit ratings when it does.

Reading back on this post I'm aware that I sound smug or bitter or something, but what I actually feel is relief that I'm not some mad naysayer, and sorry for those who felt so much pressure that they gave in and now are facing a huge financial mess.

The only winners from this whole situation are, as ever, the very rich. To whom house price rises and falls are very long term games and who won't be out on the streets because their portfolios are taking a few years dip.

internationalvulva · 02/08/2012 18:53

Noddy, just to say I agree with pretty much everything you have said on here, you speak, as ever, a lot of sense.

BiscuitNibbler · 02/08/2012 20:23

You can't really compare the rental market in the UK with that in Europe. Comparatively they are worlds apart. A renter in the UK has hardly any security of tenancy (obviously excluding local authority tenants) whereas European countries gives on the whole give tenants a virtually secure tenancy for as long as they wish.

The current housing situation is only really an issue for those who need to move. Everyone I know who does not wish to move is busy paying off as much of their mortgage as they can and making home improvements.

If you can put up with your current house then you would be better off staying where you are and riding it out. A renter will be paying rent for life, whereas a mortgage has an end date.

BiscuitNibbler · 02/08/2012 20:25

Excuse the errant "gives" in the above post. Wine and typing do not mix.

alabamawurley · 02/08/2012 22:46

BiscuitNibbler I don't think anyone is trying to claim that renting is preferable to buying long-term but as with most investment decisions (which buying a home has largely become), its all about the timing. As someone who has done ok out of property in the past, I know there will be other buying opportunities..but not for some time yet. They say only monkeys pick bottoms but for sure we're not even close to the bottom of this one.

And yes, riding it out is an option if you don't need to move. However I suspect that anyone expecting some miraculous recovery within the next 5-10 years will be sorely disappointed.

DamselInLastPlace · 02/08/2012 22:56

DH and I just don't see buying a house as an investment decision at all. We've decided to see it as a getting some control over our living space (and security beyond a 2 month notice period). We'd be paying rent (more than our mortgage will be after we cOm

DamselInLastPlace · 02/08/2012 22:58

(stupid phone)

... after we complete), and we never plan to move. We're just going to try to do up the house and then pay down the mortgage as soon as possible. But we don't

internationalvulva · 02/08/2012 23:46

That's true BiscuitNibbler, but even in the uk home ownership is a comparatively new thing. (I use the word comparatively because I am talking within the last half century. When renting was the norm for the working and middle classes.)

There do exist landlords who want long term tenants, but they tend to be estate based as ours is. I do think we will see a change in this in the next few years though...simply because it will become such a necessity to rent for so many people. if DH and I struggle on a decent salary with no debts and some savings to find anything in the area we want to live approaching our 40's, then heaven help school/Uni Leavers on entry level salaries with gargantuan debts to pay...

internationalvulva · 02/08/2012 23:50

Actually, just 100 years ago only 10% of homes were privately owned, compared to 70% in 1999, that's a huge change.

BiscuitNibbler · 03/08/2012 06:16

I would say if you are struggling to rent now on a decent salary then you need to seriously consider what you are going to do when / if you retire.

I agree with Damsel, owning is about having security and control over our housing. The only investment I see in my house is an investment in my future housing costs. We're paying as much as we can now while we can so that in the future our housing costs will be bills, repairs and council tax only.

internationalvulva · 03/08/2012 08:06

Sorry meant struggle to buy BN. And retirement is a whole other story...

fussychica · 03/08/2012 15:50

We returned from abroad to be told by EAs that we would, as cash buyers, be able to make cheeky offers and land up with a good deal. In reality people were only prepared to consider offers within about 5-8% of their asking price. We eventually got a pretty good deal but it took some time. Property in this area still moves quickly and property coming on recently seems even more expensive than we were looking, which really surprises me.
In contrast we are struggling to sell our house abroad and have reduced the price by almost half of the original valuation price, which is also the price we paid for it so you can imagine how many 10s of thousands we have lost. Our nest egg is no more and our retirement won't be how we planned. Upsetting when you have never been in debt Sad

fussychica · 03/08/2012 16:25

This is my lovely house in Spain - I mentioned above. If it were in the UK I'd be rich!
www.rightmove.co.uk/overseas-property/property-32087794.html

MrsJREwing · 07/08/2012 06:35

I just had a look at dm and saw an article which was Refering to Halifax and a falling housing market. I have found the twenty something estate agents who know nothing but rising markets are very deluded atm.

MadBusLady · 07/08/2012 08:03

I read an article not long ago in which an EA said "We can't tell what the market is really doing at the moment due to the low level of transactions."

Erm, that is the market then mate Confused. It's like they think 'the market' is a synonym for 'big magic thing in the sky that usually makes us fuckloads of money', and if it isn't doing that any more then they think it isn't working properly.

Tansie · 07/08/2012 11:10

Fussy- lovely property! We were surprised, though at the price of property in Mallorca last week. 2 bedroom villas with pools a short drive from the beach are up around £500,000! That's £!

Well observed, madbuslady re The Market.

Zhaghzhagh · 07/08/2012 11:17

Fussy - did you live there full time? I always wonder what people do in such a remote area

alabamawurley · 07/08/2012 11:35

You mean this one:

House prices have fallen by 20% in the past 5 years leaving millions in homes worth less than they paid for them

Looks like Nationwide and Halifax indices are both showing increasing annual falls now.

Agree re the younger agents - many are unable to change their strategy in line with a falling market; average selling prices around 2004 levels yet asking prices are almost at all time highs. Hence so few deals being done.