Thoughts on house prices rising in Oct

[Anonymous002]

What’s everyone’s take on the news regarding house prices rising for the first time (October) in 6 months?

data reported by Halifax and savills property agent and on several news channels.

thanks.

My thoughts are: bloody irresponsible reporting, yet again.

Do they mention it's because really expensive houses are selling instead of normal priced and cheap ones?

I bet they don't.

It’s misleading. Based on where I am on south east coast, the only properties that are selling quickly and for prices that look to be similar to last year are the types that are always in high demand in very sought after streets. I suspect bought by cash buyers / wealthy downsizers who are less impacted by interest rates. Everything average or needing work is being reduced and still not selling.

One months data is not enough to draw any conclusions from.

This happened if I remember rightly in the 1990s but it was just a blip Houses continued to fall.

Around where I am in SE house sales are very few and far between!

It's not true, prices are falling, the media dont understand the methodology and have misrepresented the conclusion. That bloke Charlie (yes i know hes not popular with everyone) explains it here :

https://www.youtube.com/live/mGi7VexF-x0?si=FXEumWGq51e6Rn6e

Some of the really big drops won't have entered the stats yet, because they are on properties that aren't budging.

For instance I saw a listing for a 2-bed flat, several sales in the block at or around £375k until 2021.

Listed at £375k, cut to £350, £325, most recent cut £300k.

So where will it end? Including the service charge, letting fees, provision for expenses/void, you most likely would need a £150k deposit just to break even, and that's forgetting you can earn interest on that £150k now.

So no surprise that something like this would have been snapped up by landlords at 1.x% rates but not today.

But it's like that for a lot of flats all around London.

Prior to last year people have been able to avoid crystallising a loss by renting it out, but the high interest rates have made that impossible for anyone on high LTV.

I've noticed things up here taking longer to sell- houses around the £650,000+ mark and flats around the £500,000+ (top end up here) . They are gradually reducing- one not far away in a very nice coastal village had been reduced by £55,000 in the last 6 weeks (flat) and a house that has, over 10 months, come down from £850,000 to £725,000 (it's lovely but has issues) . Several that have been on the market 6 months or so and just not budging.

October 22 was a very odd month (immediately after Liz Truss’s budget) so any statistic that involves a comparison with that month is likely to be an outlier.

If there is a further rise in prices in Nov/Dec, maybe I’ll take it more seriously.

I agree with @Mildura that one months data is not enough to be very significant. Generally speaking the data seems to suggest that house prices are gradually falling or remaining stagnant in the majority of areas so a one month rise could be an anomaly.

Sometimes you just have to read the whole report and not the headline.

"“Across the medium-term, with financial markets not anticipating a decline in the Bank of England’s Base Rate soon, we expect house prices to fall further overall – with a return to growth from 2025."

So prices falling this year and next year.

A massive £6000 drop this month reported by rightmove, and that's just on an average priced house !

uk.finance.yahoo.com/news/uk-property-asking-prices-drop-november-060046879.html

https://uk.finance.yahoo.com/news/6-000-wiped-off-average-000100367.html

The article you quote refers to asking prices @DrySherry not sold prices. The bloke you promote does not normally put too much store by asking prices nor by the findings of experts from organisations like Rightmove but I'm guessing he is happy enough to quickly accept their report this time?

I'm not sure a £6,000 drop off the asking price of a house would really be considered "massive" by most people, and it is of course an average so it's not like every house for sale is suddenly being reduced by 6k. In fact the report does point out that while there are yearly price declines in the Midlands and in southern England, the more affordable areas of Wales, Scotland and northern England have seen asking price rises. Just as with the October house price rise, the whole report needs to be read not just the headline. Salient points include:

Across Britain, average asking prices by new sellers fell by 1.7% (£6,088) this month to reach £362,143
While asking prices do usually record a fall at this time of year, the 1.7% fall is the biggest percentage drop recorded for the month of November in five years, the report said.
Rightmove said the fall indicates that new sellers are increasingly adopting more realistic price expectations from the outset of their marketing, to tempt potential buyers.

It will be 2025 before there’s an increases….more drops to come I reckon

but I'm guessing he is happy enough to quickly accept their report this time?

Charlie? Nope. You seem to think he's all about ego, when all he's really interested in is people being properly informed and reading beyond the headlines.

This morning he has said: it's perfectly plausible that the reason house prices have fallen is because a higher number of cheaper houses are selling; just as when we see headlines about price rises, it can be that a higher number of more expensive houses are selling. He also said that it could be that agents are being forced to price homes more in line with what people are currently prepared to pay, that the penny has finally dropped that overvaluing homes to get business isn't going to actually earn them any commission.

(something about 80% of their time is spent winning business/stopping their competitors getting it; christ, that's a lot of time spent on that one thing!)

He didn't say 'I agree, prices have definitely fallen.'

He also recommended people to watch this video:

I wouldn’t say that’s ALL he’s interested in Kiev, he does monetise his advice after all. You’ve agreed he’s a narcissist in the past so a big ego goes with the territory really.

Changing the subject back to this report, it is not about house prices falling but about a fall in the average asking price.

Not even that. It's a fall in the average - probably arithmetic mean - asking price of the properties recently listed. It's a pretty rubbish index whichever way it goes.

I wouldn't call him that. He probably said it himself and I repeated it to you. He's not short on confidence, that's for sure.

Meh. They never explain these things fully enough for the average Joe to understand what really going on anyway.

^^ in that link up there, Damien quite rightly points out that there's a 20k difference between what Halifax and Nationwide consider the average house price to currently be. If those two massive lenders can't even agree, who can be trusted? Almost no-one!

meh I can't be bothered to search exactly what you said but my recollection is that you called him a narcissist.

I did watch the link you posted from Damien and liked his content. Could pick some areas of disagreement but on the whole I liked his style and he makes some good points succinctly.

Trust no one! Your new motto?

Trust no one! Your new motto?

I believe in data, Twiglets :)

I pull the numbers and recently sold prices off Rightmove and Land Registry and crunch a bit of history.

The problem with people is that most of them have a vested interest, or are human, thus misquote, misremember, or say something in a way that can be misinterpreted, etc.

I'd be curious to know which points Damien made that you don't agree with. He seems pretty level headed to me.

"The article you quote refers to asking prices @DrySherry not sold prices."

Yes yes, I'm well aware of that Twiglets1.

What worries me is that people are going to manage to secure further discounts on those reduced asking prices (which it seems fair to assume is likley to happen in a lot of cases). So then just how big really are the real falls at the moment ? It's not until May/June time next year that the majority of that info will be available... We really are in "buyer beware" territory. Would you not agree ?

He said the notion of rates coming down by mid 24 seems “very unlikely “ at this stage.

I don’t agree it’s very unlikely ( for rates to come down a small amount 0.25 or 0.5% say).

He’s entitled to his opinion and may be proved right of course. I know it’s possible rates won’t come down until the end of 24 or even 25. But I don’t agree that it’s almost definite they won’t, as he seems to imply.

Damian interviewed my recommended investment talking-head on the internet - Pension Craft's Ramen Nakisa.

@XVGN we're being fed the same people by YouTube. I watch both of these guys too. Why are they all male, by the way?

It's a small world on the internet. I'll have a watch of this later.

@Twiglets1 I didn't notice he said that, and I agree with you. I think we'll see small falls towards the end of next year in the base rate.

Even if we don't, lenders are tripping over themselves and will cut rates and increase affordability; they're at war with each other and desperate to get feet through the door right now. I had a call with our broker last week; our finances have not improved, and yet there is a very large lender out there who is prepared to lend us an astonishing 50% more than anyone was prepared to lend to us back in May.

I nearly fell of my blinkin' chair.

(in absolute disgust, frankly - nobody should be offering more than x5.5 salary in a single income household during a shrinking economy)