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Original poster

Waiting for the current housing boom to calm down

134 replies

stuckinaditch · 25/04/2021 16:11

We were originally planning to buy a new (larger) property last year but decided to wait due to the current property boom fuelled by pent up demand, more WFH, v low interest rates and government policy. Things seem to be peaking now in many areas currently with many houses selling in a week at over asking price, bidding wars, etc

We have decided to monitor the market and wait as we are not in a huge hurry and don't want to get involved in what seems to be a frenzied market. Obviously there are risks to waiting but equally there are risks to buying now.
Has anyone else decided to do similar?

OP posts:
Hexinthecity · 25/04/2021 19:13

We’re waiting, it’s a gamble though, think a lot of people will be in negative equity next year with redundancies at the end of furlough which will mean there'll probably be less coming to market so it’s a double edged sword, but it’s crazy round here at the minute . Houses are being bid up and up in some cases up to 100k over asking which is frankly mental.

ThinkAboutItTomorrow · 25/04/2021 19:20

@GrumpyHoonMain I'm not surprised. Trains are fast it's the bit at each end that adds a lot of time.

I'm in zone 2 and have a 45 min to an hour commute (only 10 mins of it a train journey, the rest walking to and from the train).

So if you're coming in from the edge of London it's easily 1.5 hour.

Alonim · 25/04/2021 23:07

We're waiting too. Not expecting prices to drop (I wouldn't be surprised if they did though). Just waiting for this madness/desperate buying to end. So we can think a bit more calmly and clearly about what where we're moving to.

Zenithbear · 25/04/2021 23:25

We're waiting. We are looking for another rental property as we have come into a sum of money, as well as saving extra over the last year. So for the time being we're going to just wait and see and not panic buy.

surreygirl1987 · 25/04/2021 23:36

We are shortly due to complete on the sale of our house and then we are going into rental for a bit. We don't want to wait for too long but there's barely anything actually available right now that we like in our price range and in our area. We are relocating so figured we may as well get to know the area first before buying anyway. We are a little worried about being priced out of the market if we wait too long, so I imagine we'll only wait a few months max. It's frustrating though- there is SO much ton Rightmove that is SSTC that we love and could afford... but that all sold before we we were ready to buy!

Roselilly36 · 26/04/2021 07:47

It will be interesting to see how the property market adapts when the SDLT break comes to end.

Hopefully there won’t be a crash, like we saw in early 90’s & 08. But I can’t see how the property market can continue as it is currently.

When so many factors economic will come into play later in the year, furlough ending, businesses bounce back loans repayments will start, SDLT break ending.

To be honest, I wouldn’t buy at the moment, I have a long memory and we were caught out in the early 90’s when we brought our first home, the market dropped so much it took us 10 years to get back to the price we paid for it. I wouldn’t wish that stress on anyone. Lots of people were handing in their keys to building societies, awful days.

EssentialHummus · 26/04/2021 07:55

Ass on fence here. In a large flat, would like a house, DC2+3 on way. I think if we were to buy now it'd be something unpopular - even now you see houses reduced/lingering for various reasons, so you can find a deal. But we have the luxury of space and with DC1's school application looming a certain desire to stay put for a great school place.

LonstantonSpiceMuseum · 26/04/2021 08:02

I'm doing the same... I'm in an interesting position though as I looked at what I could do with my deposit in terms of long turn investing Vs deposit for a mortgage. Over 25 years... The return was about the same. This is assuming putting the difference away each month towards investment, estimated house price increase etc etc. And my biggest assumption was that interest rates will remain the same - which they are unlikely to stay so low for long!
Add into that the sheer number of people leaving the country, I think we will see a correction, at least in the area I'm in and my particular situation.

umbel · 26/04/2021 08:18

It’s a dilemma, isn’t it. We sold in February for a good price and got a deal we were happy with on our onward property soon after. We were smugly feeling ahead of the curve when our vendors decided they no longer wanted to sell. We are now in the difficult position of either stalling our buyers while we join the bun-fight over every property that comes on the market here (and there are very, very few), pressing ahead with the sale, moving into rental and frittering money on rent and storage while we wait and hope that the market settles soon, or pulling out of our own sale and forgetting the whole thing for a while.

Having had the rug pulled out from under us, I’m loathe to do the same to the family who are buying our place, but I’m feeling a bit panicked and stuck at the moment.

Original poster
stuckinaditch · 26/04/2021 12:04

A few other people doing the same and holding off for now.

@Bluntness100- I'm hoping and expecting the frenzy to reduce. I don't want to get into a bidding war, panic and over pay. I don't agree that this is just the market catching up at all. The housing market was only closed for 2 months and it took off like a rocket as soon as it reopened and then in was further fuelled by government policy and the cut in interest rates. Average prices have increased nearly 9% in a year and > 20% in some areas. That is not just a catch up.

Of course there is a risk that prices will slowly rise/ plateau rather than fall but we have a good deposit so are fortunate. Overall, the risks of buying now seem higher than those associated with waiting. We don't know what will happen once (if!) government support for the economy is reduced and withdrawn. The fact that it is being withdrawn so slowly (furlough ends long after the economy is allowed to reopen) tells me something. Yes, there will be a Spring/ Summer recover but things are more unpredictable after that.

OP posts:
OneRingToRuleThemAll · 26/04/2021 12:14

My parents were told to wait for the crash in 1998. I was told to wait for the crash in 2008 (south east) it didn't happen. Sometimes if you wait for a crash you'll still be waiting a long time down the line.

Miasicarisatia · 26/04/2021 12:19

My money's on the huge crash
(I've been waiting 20 years for it...bound to happen I'm sure😳)

sabrinathemiddleagewitch · 26/04/2021 12:23

We are waiting.

Prices in our area are massively inflated mainly due to the stamp duty holiday and surge of buyers who have been waiting a year.

I don't think prices will drop pre-covid, but I do think this recent inflation will drop. It makes no difference to us, the stamp duty holiday and price increases means your paying that amount one way or another.

Later this year/ early next year works for better for us and we're not going to rush into something, or pay over the odds for something just because everyone else is

Bluntness100 · 26/04/2021 12:34

Op it’s a judgement call and subjective. No one knows. So you take the gamble and see how it pans out. You either win or loose. There is no crystal ball here.

flashbac · 26/04/2021 13:04

I was like you op but have decided to jump in after waiting years for a crash (Brexit, covid and so on). Why? Because this government is intent on keeping prices up, they are printing money like there's no tomorrow to do it. There is also massive undersupply. High house prices mean investors keep hold of property and buy more but we don't have a big house building programme so that adds to the supply issue. Foreign buyers are also swooping in. Unemployment may rise but that will be among those already priced out of the market anyway so that will have limited impact.
Basically the Tories will do anything to keep a boom going cos it enriches their mates and makes homeowners feel good so increases confidence in the economy.

Miasicarisatia · 26/04/2021 13:21

The Tories will do anything to keep a boom going
I agree but they surely also realise that it's not sustainable.... there will be a crash but they will try to engineer it such that the impact on their interests is minimised

MidnightMeltdown · 26/04/2021 13:24

It depends a bit on where you're buying. House prices are predicted to rise 25% by by 2025, but I think that increases are expected to be larger in the North and Midlands than in London and the South East. Now that 5% mortgages are back, I think it's highly unlikely that they'll be a crash.

Original poster
stuckinaditch · 26/04/2021 13:31

@flashbac

I was like you op but have decided to jump in after waiting years for a crash (Brexit, covid and so on). Why? Because this government is intent on keeping prices up, they are printing money like there's no tomorrow to do it. There is also massive undersupply. High house prices mean investors keep hold of property and buy more but we don't have a big house building programme so that adds to the supply issue. Foreign buyers are also swooping in. Unemployment may rise but that will be among those already priced out of the market anyway so that will have limited impact. Basically the Tories will do anything to keep a boom going cos it enriches their mates and makes homeowners feel good so increases confidence in the economy.
Very true.

I haven't been calling a crash and never have previously either.

A reduction in the heat in the market later in the year seems likely although all other options are possible too. If top economists can't even agree on whether we are heading for deflation or inflation what hope is there for the rest of us? I think it's inflation but time will tell.

OP posts:
Countrylane · 26/04/2021 13:32

We're in the West Country and I know several chains that have collapsed in the last few weeks as London buyers suddenly got cold feet (and have been told they'll be expected to be in the office at least two days a week - and realise that it's not actually going to work as they thought.) I get the impression the market has already started to slow round here. If something isn't priced reasonably, it just sits there. I'd say the absolute peak was actually last summer and there was another minor bounce when they announced the Stamp Duty extension. Of course, it may pick up again this summer when people have to holiday in the UK and think "Oh, this is nice". But it's def cooling at the moment. People who could move easily have already done so. And as London picks up again, I think people will remember it is a nice (and convenient!) place to live.

Countrylane · 26/04/2021 13:34

Remember - country estate agents are hugely hugely incentivised to create a panic buying environment. But several big (and stunning) houses came on the market round us in the last few weeks - and they are just sitting there - and this is a popular location. NB ours is not big or stunning, I'm just nosy on RM.

Original poster
stuckinaditch · 26/04/2021 13:39

@Countrylane- I do think of the buyers moving out from London/ SE will regret their hasty decisions. It seems fairly obvious that full time home working won't remain for many and besides that rural life and even life outside London is totally different.

OP posts:
LolaButt · 26/04/2021 13:42

The guardian had an interesting article either today or yesterday. Essentially forecasting that the economy is bouncing back at speed and the unemployment figures have been revised down based on strong economic data.

If that turns out to be along the lines of the truth, I wouldn’t foresee a crash. Perhaps a correction or slow down in value increase.

Like others have said though, crystal ball.

Countrylane · 26/04/2021 13:50

@stuckinaditch I love it down here, but even so, the winters break me. I never noticed the early darkness when I was living in London, but it is brutal. And you spend so much time driving etc - I dread to think what it will be like when the kids are a bit older and we finally escape lockdown. I think WFH is fine if you're at the point in your career when you don't mind plateauing for the rest of your career, but the reality is that for most jobs, a plateau actually equals a gradual loss of the skills etc you just absorb without noticing in a work place. And if people get made redundant, they're going to have a horrific shock when they meet the local job market, even in cities like Exeter and Plymouth. I think a lot of people came down here last summer and thought, oh lovely. But a really nice couple I've met who moved in last October are already realising it's a mistake (and paid an absolute stonking amount for their house) and I can't see them staying for even the rest of the year.

flashbac · 26/04/2021 13:51

@Miasicarisatia

The Tories will do anything to keep a boom going I agree but they surely also realise that it's not sustainable.... there will be a crash but they will try to engineer it such that the impact on their interests is minimised
When/if that will be is anyone's guess. I think we have a few years of heat left at least but who knows. It also depends on area, Leeds is heated due to channel 4 and bank of England moving there. North west, I'm told, is attractive to Hong Kong buyers who are taking advantage of Visas sceme offered by the government. Plenty of steam left IMHO.