The current market is utterly depressing

[DrinkingLattes]

Does anyone else feel the same way?

I'm a first time buyer and started house hunting around 4 months ago after my contract in work was made permanent. Deposit and AIP ready and solicitor lined up but there is absolutely nothing coming onto the market. I check right move every day and there are around 6-7 properties being listed but they are all flats or 4-5 bedroom houses. Where have all the starter homes gone? Is it just the time of year or the fact prices have fallen? I know people (myself included) were hoping that prices would come down due the mortgage rate rises but now it seems like people just don't want to sell... it's depressing

A lot of people are downsizing into the type of property you are describing. If none are coming to Rightmove, I would suggest you start contacting agents, let them know how serious and prepared you are (providing proof will help), and ask them to call you when they get new listings or fall throughs.

I think a lot aren’t even hitting RM because demand is high. The people buying them are those who have put in the legwork and are regularly in phone contact with EAs.

House prices don't fall massively though. People just won't move if they can't afford it. The issue I'm finding is people pricing homes based on the 2021 bubble and the landscape just isn't the same EoY2023.

Having said that, you might find more properties come on the market in the new year.

People might not be wanting to sell due to higher mortgage rates if they are on a good fixed rate with a few years to go. Although I think sometimes you can port your mortgage across to a different property.

House prices are falling slower than might be expected because it takes time for people to roll off their mortgage deals -- and some people think they'll be able to keep going because mortgages will cost less when they need to remortgage. It's a weird stalemate, but prices will keep coming down and I think it will accelerate.

It can’t be blamed on the time of year if you started house hunting 4 months ago @DrinkingLattes

Sellers know it’s not a great time to be selling so many are choosing to leave it until the market picks up, unless they have a pressing reason to sell. The market has stagnated in lots of areas which makes it difficult for buyers & sellers.

I would expect the market to pick up slightly in the Spring but not drastically. What will help get things moving again is when interest rates start to come down because that will have an effect on the sentiment of buyers which in turn will influence sellers.

We could sell but won’t because the higher rates mean it’s not worth it. Prices haven’t fallen enough to combat higher rates so we will stay here. Catch 22- this means housing stick is limited and this prices don’t fall enough…..

We are considering a move to downsize and future proof, but there isn’t anything on the market that has what we require. I’d be happy to be cleaning fewer bedrooms, but I still want space in other rooms.

I think it is about 100,000 people every month coming off a fix? Interest rates will soon start doing their work of bringing down prices as there are always people who must sell for whatever reason, house owners that "stay put" are not part of the market. There has never been a crash in history where house sales dont continue, in fact there is usually a tipping point where people try to get out of the asset class as they start to panic, and I think in the 80s crash there was a trend of cashing out of property just to raise cash for everyday expenses, rent, food etc.

If you are looking for a starter home, where would those people be moving to? Any step up has gone from being a little stretch (as would br normal before as couples moved on as their family expanded) to completely unaffordable. So they’re staying put and squashed. The only homes i see selling round me are the (rare) flats and starter homes - still affordable round here to a couple on reasonable money desperate to stop paying extortionate rent, but previously they might have been looking for a 3-bed house and had enough to spare to do it up as well.

Prices don’t just need to fall to pre covid prices to be as affordable as before, with higher interest rates they need to be maybe half the previous price (I’ve not done my maths, but assuming many mortgages have doubled for people with a large capital balance left). And that’s not going to happen either.

In that case many people will have to stay in the "starter homes" they bought for the rest of their lives, and there will be a LOT of EAs out of work, without proper price discovery the market cant function.

A flat IS a starter home OP. Do you already have a family needing 3 beds?
When I was looking (1.5 years ago) I found that, in certain areas, all the starter homes had been done up/extended to within an inch of their lives. So they were no longer in our price range. Also as a PP said those in 'starter homes' can't afford to upsize so are staying put.

Are you looking for a 2/3 bed terrace?

If prices fell to half what they are how would new houses get built? Excluding parts of the country where prices are utterly divorced from reality (eg London). Where I am in the south east a 1 bed maisonette is about £220k. If it was half that then you’d have no house building going on - if it costs £100k to build an extension how can it cost less than £100k to build a little house (even on mass scale) plus the land plus planning plus the levies for local infrastructure and the affordable housing contribution. We already have a housing under supply, everyone really would be stuck.

I think in reality it will be something in the middle - so maybe prices fall by a quarter. There are a reasonable proportion of people not mortgaged to the hilt which will keep the market flowing albeit very slowly,

What would be an amazing outcome is if the government decided to use this as an opportunity to buy land back off the house builders and build a whole load of social housing.

Or there’s a sudden revolution in house building, like the post war pre-fabs but designed to be permanent not temporary.

Sorry OP I’m not helping you. Hopefully something will come up soon for you!

200,000 remortgaging every month.

1.5 million will have to remortgage in 2024.

This. A flat is a starter home. What’s wrong with a flat?

The housing market has never recovered from the Covid madness n my opinion. We tried to buy and sell in 2021/22 and just couldn’t find a property to buy. We were constantly out bid by people paying tens of thousands over and everyone was a cash buyer. Then supply all but dried up. Then no one knew what their house was worth. Then the market was flooded with new builds.

I think it might have been possible if we didn’t have a property to sell but just ten years earlier everything had been very simple for us. So I think it’s a supply issue still.

Register with estate agents - only the problematic homes make it onto rightmove round here , they sell before that

@kopitiamgal @TedMullins there's nothing with flats, I just don't want one. I tried to buy a maisonette back in 2021 and it was deemed unmortgageable 3 months later. I wasted money on searches, surveys and solicitors fees, not to mention the stress, all for absolutely nothing. I know not every flat is like that but it's massively put me off them. The ones in my area for sale have been on the market for months, if not years because nobody wants them. Why would I buy something when I know it'll be difficult to sell later down the line? Most of them are also the same price as some 2-3 bed house so it wouldn't make sense to buy one when I can afford a house either.

How can they be the same price as 2-3 bed houses when there aren't any for sale?
I'm just trying to get a sense of the area. If you look at the sale history in a certain postcode are there a lot of 2-3 bed houses?

OP is right not to consider flats. They may have once been starter homes but they aren’t anymore. Flat prices have stagnated since 2016 whilst houses have skyrocketed. There’s no way you can now move up the ladder with a starter flat as the price won’t increase. Also don’t forget cladding issues, leasehold nightmares with rates doubling every year.

Well there are flats and there are flats.

I wouldn't buy a new build flat either but if I was in Edinburgh/Glasgow I'd happily buy a Victorian tenement flat.

It's grim. Currently trying to sell my starter flat (large maisonette in London zone 4) and we are also looking for our onward purchase.

I am getting royally dicked around by my buyer (our third one 😬.) We are already selling at a loss and had priced the flat realistically and very competitively relative to everything else in our local area, and yet our buyers are still flip-flopping about whether they want to proceed and asking for reductions in price (they haven't even had a survey done). It's in great condition, less than 10mins to the train station, quiet road, unusually spacious property for a flat etc ..
When I look at the stock that is on the market locally that DH and I might want to buy my heart sinks. £500-600k will get you a two-bed+box room house in zone 4 that realistically needs a good £50-£100k of work doing to it and is at least a 20min walk from the station.

Unfortunately for whatever reason a lot of vendors at the moment really haven't kept up with even the most basic maintenance on their homes yet still expect to command premium prices for them. In at least two cases with properties we have viewed lately the back gardens have been so overgrown and full of shite that they are actively dangerous for children.

So if I were to proceed with buying a typical property in my budget in my area, I would be paying £2.5k a month at least for the pleasure of living in a grotty house in an inconvenient location that needs expensive remedial work done asap. And let's not forget how expensive labour and materials are right now. There is also a significant risk of my buyer pulling out or a chain collapsing, meaning more financial risk for DH and I.

I'm seriously thinking of staying put in our maisonette for another year. Yes, it's not ideal for DC not to have a garden and I know a lot of other mums look down on me for living in a flat. But we have two more years to go of on our cheap fixed mortgage and every month we are here we save money and put it in a high interest account. I'm honestly wondering if it's worth the hassle and heartache to try to buy and sell in this market. There is honestly nothing out there I can afford that I want to live in.

Go to the new build sites , they aren't on right move .

I wouldn’t discount time of year, even allowing for your starting your search 4 months ago. Most people still want to list in spring/early summer to ensure a move by Sept, and late June is getting into ‘we won’t be moved by Christmas’ territory given current conveyancing times.

This, combined with the other factors pp have stated are making it a grim picture right now.

I’d ensure I was absolutely ready to pounce in the New Year and hope that something gives by then…good luck!

Edited for typos!

Exactly and the same thing in London which has some beautiful Victorian flats that cost more than houses elsewhere. It’s not feasible to go straight to buying a house in London or other really expensive cities.

I am the opposite, trying to sell a house and not one viewing, let alone an offer. I'm going to take it off the market and rent it out.

I know a lot of people staying put because the market is dead.