Property prices soaring any Estate agents that can help?

[Pottytraining37473]

Hi Everyone,

I know this is one of those things that no one can really predict… but what is with the crazy over inflated house prices and biddings wars?

We are in the midlands trying to buy a property, however there is almost 15 plus offers on every property we have viewed , houses going for 20k over asking…..and houses are going for over 30/40k than they did last year.

Is there an end in sight? We just cannot compete in any way financially it seems, and feel so disheartened that we won’t be able to buy a home for ourselves. We have been saving for years and are close to being priced out.

Any estate agents that can provide some insight into what is going on or anyone?

There’s no more insight than supply & demand, really, unfortunate as that is.

Plenty of people sold when the market was high, to maximise what they’d get for their house, and either went for rented or their chains collapsed but they sold anyway. Which means there’s a lot of cash rich people around.

Being “locked down” at home for over a year has made people think about their houses, and notice their shortfalls. And some people have seen changes to their jobs which mean they’re happier for a longer commute, or don’t think they’ll need to commute so much…

It’s a bit of a perfect storm. Expert opinions vary massively, but the most realistic seems to be that prices will stagnate for a few years, to let life “catch up”. A big fall is possible, and some people had been predicting it for years - there was a lot of it when I was buying my flat 8 years ago! - but it’d be bad for the economy, and the government would likely try to stop anything major.

The Midlands seemed to peak later than a few other places, and lots of chains seemed to fall apart when the second lockdown came around, so I think we’re still feeling the effects. HS2 has the benefit of faster trains & making people feel a daily commute to london would be more palatable, too. It’s been a bit crazy here.

I can't see how they continue not with the tax hikes

I agree it will be stagnation tbh my area of London stagnated after Brexit

@chukwe

As long as immigrants are allowed in through the channel, house prices will never fall

Put the DM down and try to think. Migrants dont compete for housing purchase, if they did, price would have collapsed last year when 1.4m left the U.K. during the pandemic of which many will never return.

Prices are entirely driven by credit availability. Since interest rates have never been so low and with bank fighting for mortgage customer, any household can borrow vast amount of money for less in interest payment than their family holiday.

Now it’s not a U.K. only issue. Gobal interest rate are mostly driven by the FED/$ so as long as they are happy to live with 5-6% inflation and inject 100bn$ a month in the economy, we shall continue to witness a high asset price across the globe. No one can predict if we live in a new paradigm of perma free money or whether we re on a verge of a reversal of interest rate direction that started 30 years ago

The immigrants do not live in houses, use the NHS and Schools. Houses are not needed for them. The hundreds arriving daily do not affect the infrastructure. Anybody who do the maths is a daily mail reader. 🥱

The rush to meet stamp duty holiday is over. So I am assuming things should slow down slightly?

@Paulina23

This is simply not true. All these extra people still need somewhere to live. This puts increased pressure on housing stock and pushes up rents - which are not unrelated to house prices.

It's got nothing to do with the daily mail, it's just basic economics. If the demand wasn't there, then rents and house prices could never have spiralled the way that they have done.

Prices are entirely driven by credit availability

That part is pretty accurate though.

So long a people are prepared to pay the advertised price, or as it appears, enter bidding wars, then the prices won't fall.

Simple supply and demand.

If person A cannot get a mortgage high enough to compete with person B who can. Then any seller will pick person B, not take the lower offer.

Immigration does also affect prices. Ok, most migrants probably don't buy on entry into the UK, but local councils will house them using private landlords. Thus demand for rental stock gets more competitive, and landlords buy more stock.

Its mad, but that the way it is.

I don’t want to troll the debate toward immigration. Yes it is one of the many factors that contribute to the price pressure, but the idea of population overflow perpetuated to justify obscene housing price (particularly in the capital) is not the main driver. Population in 30 years in London increased by 1.3 since 1990, while price multiplied by 7. Even without immigrants, demand he practically limitless, if price a lot lower, young people would move out of their parents earlier, couple that don’t get along would separate more easily, and more household would own a pied à terre or 2nd home. The single most important driver has always been the availability of cheap credit. If interest rate were to reverse, no matter how many immigrants coming, the average household would not be able to borrow as much so price would inevitably fall (yet cushioned by a larger pool of buyer in this scenario).