This weird property market...

[BlowingAHoolie]

We have finally put our place on the market to look for something bigger for our growing family.

It's only week 3, there haven been 3 viewings and the estate agent is already saying to me that it's a "weird market" right now.

We live in an area of London where things usually sell like hot cakes.

Have started to look at places to buy as I would like to have found something if we get an offer... it's just making me feel a bit uneasy.

Anyone have anything constructive to say that would make me feel better? Or just some good advice

Yes, I can’t speak about individual areas, and obviously the gov report is done monthly so last one aug, all major areas still growing, inc London. Prices up five percent on average year on year. Month on month still increasing.

Some smaller areas are bucking the trend though and houses dropping, I think some areas of Scotland and the north.

However no matter how far back in time you go on these type of threads, they are always full of posts saying London will drop, prices are dropping etc. It’s really more rhe posters misunderstood what the market was then. Demand is factually still out stripping supply in most of the country.

Bluntness government guides rather like the Halifax guide are not to be replied upon

Why? I’d rather deal with fact than anecdote. As said, no matter how many years you go back. Folks have been saying the same thing. Perfect storm, can’t afford it, rates will rise, prices will drop.

I personally don't subscribe to the "drop your price" scenario. I agree in a buoyant market if properties are selling and if yours is sitting there then price is usually the issue but in a non existent market a price drop won't likely make any difference. It is a weird market right now, I have spoken to many agents that I know personally in London and they are saying that its like groundhog day and that people are not looking and those that are haven't even had their properties valued yet.

I've dropped my price several times and it hasn't stimulated anything and to be fair I am now priced quite a bit lower than other similar properties in my area. I reckon I could drop it another £200000 and it would still not sell at the moment. I also have a friend who has wanted to sell super quick and dropped the price of his house from £1.4 million (tbh overpriced) to £850000 which is a crazy drop but he isn't getting any viewings, lovely house it is too.
The Autumn bounce hasn't happened so I think Spring next year will hopefully pick up.

I will also add re the price that what one person is prepared to pay for a property isn't going to be the same as someone else. The place I'm moving to I paid a higher amount for as it is exactly what I wanted but it doesn't mean that anyone else would have paid what I paid.

So bluntness do you think it's sustainable forever & prices will keep increasing?

Prices defo reducing in my area & similar to above some neighbours have had hardly any viewings when they have been flying for the previous 5 years.

Property prices always cycle through. They will again, we just don’t know exactly when. We will know in retrospect as usual.

I’d be worried if I was taking on a huge mortgage right now. I wasn’t feeling the same way 12 months ago.

I ideally want to upsize but am holding off as the area I was looking at is overinflated in my opinion. Also because it's not our forever home I want to see what interest rates do.

So bluntness do you think it's sustainable forever & prices will keep increasing?

Ultimately yes, as the value of money decreases . A pound today is worth less than a pound twenty years ago. There may be short term dips, but yes, prices will keep increasing, just like the price of your weekly shop or your car, because the value of money decreases

Whatever your house is worth today it will be worth in terms of actual pounds a hell of a lot more in twenty or thirty years. There may be slumps in that twenty or thirty years, but ultimately it will continue to increase..

Sorry that should be the value of money increases,.,!

Yes but the slumps can be quite deep bluntness and buying at the high and selling at the low will lead to significant losses if you don’t gauge the market right.

Markets aren't just about supply/demand - or rather, they are, but "demand" and "supply" are complex and emotional things. At present, people are spooked by the uncertainties of Brexit - if this isn't managed well, and the signs at the moment aren't good - I think there's every chance people will become more and more anxious and prices will be affected as a result as people decide not to move at all unless they absolutely have to. (If people think prices will fall, prices are more likely to fall!) Interest rates increasing (which is going to happen for sure next month) may also impact, in spite of undersupply.

Rightmove recorded the biggest annual fall of the decade in London house prices in September - that's the third fall in four months. But when you look at more fine-grained data, it's very spread. The most expensive areas are dropping fastest of all, which suggests that the adjustment is happening at the "alpha wealthy" end of the spectrum. One possible explanation is that London property has been seen as a safe haven for global capital for a while, and that this is now shifting with demand falling. Other areas that are distinctly trendy are continuing to rise - Hackney and Southwark, for instance.

I know traditionally property is a safe bet & i agree long term there will be gains.

Where I am questioning the status quo is how on earth are the majority of FB supposed to get on the ladder now? In years past we had hot spots but now virtually every area has gentrified (or at least prices have). We have had record wage stagnation, university is only getting more expensive & the bank of mum & dad is going to be affecting by dementia/social care funding. Plus I think they are going to have start increasing interest rates albeit v.v slowly.
Also as there is a NHS crisis, huge pension deficit I think we will be looking at some tax rises too.

Depressed now!

Oh I forgot to add food prices are also increasing.

Those Rightmove statistics sound about right.

Outskirts of London & a Rightmove addict and I've seen a number of properties reduced in the last few months, which I don't remember seeing this time a year ago. Stuff seems to be hanging around longer, particularly if ambitiously priced.

We rent in London and I don't expect to ever be able to buy here. We need to move away to buy but that is difficult as DP's job is London specific. I have wondered whether we should buy somewhere elsewhere in the country, and rent it out while continuing to rent ourselves in London. That way we would have somewhere to live in retirement and have a foot on the ladder even if in a distant area. I think it could work if we could get somewhere at a price where we would have a small enough mortgage that rent would cover it and empty periods would be ok.

If a crash comes like it did in the early 90s, you may be able to itshappening.

It’s happening, you’d need to have a BTL mortgage and pay tax on the rent. Is it really that bad for you? I reckon a childless couple needs to earn 50k combined to afford an entry level flat in outer London.

It's a funny market.

I lived in an amazing flat - fab shireditch location, green views, lots of light and much bigger than average. Share of freehold. Small modern block of 12 flats.

The flat below us was on the market fo 675 last year which I thought was maybe slightly tasty but expected I to achieve 650 (and it wasn't presented well at all, crappy student rental style furniture not showing off the huge proportioned rooms).

Anyway it stuck around, went to OIEO £550 and has finally gone under offer. If that went for anything less than £620 they will have got an absolute bargain.

This flat is seriously amazing to live in, was so surprised it didn't sell. The £/sq ft would have been a good price at £650 for shore ditch

Silverspot, might be a good price for Shoreditch but you need to be a couple of high earners or one very high earner to afford 620k. It kind of demonstrates everything wrong with London property prices to me if you’re s high earner and a flat in a block is the best you can get...

@JoJoSM2 a lovely large flat in an upmarket, private, secure block is actually what a lot of young couples DO want.

You don't necessarily want to live in a big house in the 'burbs. there is nothing depressing or sad about living in this flat. Its beautiful. Green, quiet. Walk to work in 15 mins, eat out every night in one of the hundreds of restaurants in a 5 min walking radius, drink and party on your doorstep. Totally different lifestyle/value proposition.

I'm not saying that is affordable for 'average' or 'normal' people - for sure +600 is a single high earner or a couple on decent wages but it is illustrating that actually, quite an unusually good flat didn't shift where it would have flown off a year ago. Completely anecdotal I know.

Annoyingly I couldn't have even put a low-ball offer in when it was on for £675 but by the time it dropped to OIEO 550 i had already completed on my house. Gutted.

Sorry to hear you missed out silver. Guess it wasn’t meant to be.

You’re not the only. A friend of mine just bought a new build, only to find out another flat of the exact same specs is now £75k cheaper, about 10 days after she completed. She was gutted beyond belief!

All these anecdotes are a precursor to the statistical impact yet to come imho

Well of it makes you feel better silver the house I had my eye on (fixer upper) went for 750k (was on for 850k) in 2014. Re sold in 2016 for 1.67m. We had just had our 1st baby, in outstanding tiny catchment area so weren't really ready to move. Should of gone for it!

Can I ask if anyone on a Bank of England tracker is considering transferring to a fixed rate before 2 Nov?