Is this why London isn't doing so great?

[drummergirl34]

I had a thought! Throughout industralised England, when waves of people want to move to London this forces an artificial boom of house prices to sell to the outsiders. When a new technology or generation comes along wanting to move to London, the same happens and this forces house Prices in London up.

Now, with the internet, it's possible to work for companies around the world without actually being present in that location. Group meetings, face-to-face meetings and instant communcation can happen without having to move to London. This is a boon for technological companies who don't have to pay as much for someone living elsewhere outside of London as they would situated in London.

So maybe, this has had a knock-on effect with a reduced amount of people wanting to move to London "because of work" which has prevented house prices from rising as dramatically as they would noramlly?

Interesting point, could well be.

Also:

• Europeans don't snap up London homes anymore because of Brexit,
• and a number of financial services relocating staff away.
• Rich people are less interested in buying second properties anymore because of tax changes.
• Then I think your Londoner just can't afford to buy in this city anymore...it's just too expensive.
• And generally, political uncertainty is really bad for dramatic house price rises..tbh .I think those days are over

Basically I think there's lots of reasons and I've probably forgotten a few...

There is another credit crunch brewing in the banking sector because of sub-prime consumer credit on cards and - especially - car loans and PCP finance.

The banks need to shore up their balance sheets and have suddenly woken up to the idea of really questioning the "value" of their assets such as UK residential property. It is fairly intuitive that a sudden aversion to lending risk follows.

I am in the middle of selling (not in London). My buyer is telling me it takes over a month to get a survey and weeks for underwriting loans because the bank is swamped - a sentiment echoed on this forum; the estate agent is saying that the market has come grinding to a halt and banks are routinely forcing values down after offers are accepted. A theory which happens to fit those facts is that the banks are now much, much more cautious about who they are lending to and what those loans are secured against.

Fewer Chinese are buying, because it's now harder for them to get their money out. Hence the prices of many of the new build flats targeted at the Far East falling.

Other than that, I see a lot of what are obviously rental properties coming on to the market - presumably landlords selling up before the tax changes kick in.

Plus of course, prices have become insanely unaffordable. When it's become 'normal' for a 2 bed flat in Tooting to be priced at over half a million, something's got to give.

fewer Chinese are buying and fewer Russians... international sanctions, together with lower oil prices, have taken a big toll on the country’s economy and currency...

Mentioning Asian investors...also brings to mind the 'glut' of luxury flats coming on the market in the next couple of years (Nine Elms etc)...

Video conferencing has been around since the 1990s. London property prices have increased by around 600% in the last 20 years, so I don't think the Internet has much to do with it.

Meanwhile affordability has decreased, as wages have not increased in line with house prices - in 1997 the average house in the UK was 3.6 times the average annual wage - in 2017 it's 7.6 times the annual wage (and way more than that in London). That kind of increase just isn't sustainable.

Not sure remote working is having a huge impact, but it does have a localized impact for the people who can take advantage of it.

If I had teenage children I'd be encouraging them heavily towards being a software developer.

You can basically work remotely, ear 80% of the London software developer wage and live anywhere you want (cheap-o northern town, remote countryside, Thailand, South America,, wherever!)

Slowly deflating the London housing bubble could well be one of the best things that could happen.

Interest rates are going to rise.

And Brexit, obv. so fewer people and less money.

My mortgage came through in 3 days from survey and survey was booked in two days after application went in. It was very easy to take out a mortgage ime but I've heard nationwide is being slow as they cut too many staff.