House prices

[Twiglets1]

Hi Guys, we got to the end of the last thread so need another one on this controversial topic!

And to respond to @CrashyTime I don't say "demand is strong" over and over again. In fact, I rarely comment on demand at all. My posts are more focussed on house prices and interest rates/mortgage rates.

And I don't deny economic "reality", I just don't exaggerate how bad the house price correction is likely to be. I have a running bet with @XVGN that property prices generally will fall about 5% in 2023 and another 5% in 2024 so I do believe prices are falling in most areas. Just nothing like the 30-35% crash predicted by some!

Well done for negotiating so effectively. There is still a lot of over valuing going on, although I think it has reduced.

This thread is hilarious. All the data keeps coming that show there isn't a massive house price crash... and yet some still keep insisting it's DEFINITELY happening, HUGE falls, just around the corner... It's like listening to Donald Trump.

@cupcakesarelife link to property?

Prices are falling a little in most areas. I expect this will continue for the rest of the year and possibly into 2025. But you are right, no signs of anything you could call a crash ! To be fair only a small handful of posters have predicted that, and we wont know that they are wrong for sometime yet. Most others see this as a gentle drawn out re-set. Removing the foamy froth from covid madness is a good thing imo. A proper crash is not something that benefits many people, quite the opposite. Hopefully things will just continue to drift down slowly and we won't enter the economic crisis of a full on crash. FWIW a soft landing for the market does seem to be how things are headed.

I'm not sure exactly what you mean by 'massive house price crash'. If you mean a very sudden, very rapid fall, then no but I don't anyone has predicted that. A slow, continued fall over several years would also reduce house prices very significantly. I've been v bearish on the economy for ages, so house price falls would be a consequence of this. You need to wait a few years before you say that prices haven't fallen. Of course, you also need to think about real prices (adjusting for inflation), especially during periods of high inflation or over several years.

I doubt that @cupcakesarelife will want to link to her future address on a public forum!

I know 😂

You must know (I think you do really) that a much smaller pool of sales skews the averages so that it looks like there is still some HPI, there isn`t any though, sorry.

https://www.plumplot.co.uk/South-East-property-transactions.html

During Covid rates were at zero, there were stunts like the SD holiday going on to lure people into debt, rates are now over 5% and we have shipping lanes being attacked daily and the U.S/Iran squaring off, tell me how any of that doesn`t feed into higher inflation/rates? I think a lot more than the Covid froth will be coming off, but obviously a lot of people are not yet ready to accept that.

I accept your opinion is a possibility crashy, but personally I expect something less dramatic than your good self.

Fwiw I'm with @DrySherry and think we will have a gentle slide down rather than anything that could be described as a "crash".

And before you blame me for "guzzling deeply from the debt hose" and it being wishful thinking @CrashyTime we are fixed for 10 years with 50/50 ltv and making overpayments so will likely never take a mortgage again so not a particular VI and not additional debt (except student loan) just my humble opinion

Respect your opinion and all that @CrashyTime but don't you think you might be changing your username to SlideyTime by the end of the year?

Reuters article today: UK house prices beat forecasts as mortgage rates edge down

British house prices rose this month more than economists had expected, adding to signs that the squeeze from high interest rates is beginning to ease, figures from mortgage lender Nationwide Building Society showed on Wednesday.
Nationwide said house prices in January increased by 0.7% from the month before after being flat in December, beating economists' forecast in a Reuters poll for a 0.1% rise.

Prices this month were 0.2% lower than a year earlier - the smallest annual decline since January 2023 - after forecasts for a 0.9% decline and a 1.8% fall in December. Looking at the three months to the end of January, prices rose by 1.1%, their fastest since July 2022, which was shortly before rising Bank of England (BoE) interest rates and temporary bond market turmoil under Prime Minister Liz Truss hit the market.

Britain's housing market - like those in many Western countries - boomed during the COVID-19 pandemic, boosted by record-low interest rates, temporary tax breaks and a greater demand for living space as people worked from home.
Official figures for November showed that British house prices had fallen 2% from their peak in September 2022, but were still 24% higher than before the pandemic.

https://www.reuters.com/world/uk/uk-house-prices-beat-expectations-january-nationwide-2024-01-31/

You’re welcome but yes @hannahcolobus I agree Nationwide, Halifax, Zoopla they all have their limitations.

Nationwide only takes into account properties bought with a mortgage.

Looking for some advice please. Had our second valuation today.

First one valued at £390-£400k. We were hoping for around £420k but got with the programme quickly as these are the times.

Second has said £375-395k. We have the third on Friday and will also take that into consideration.

Having checked rightmove, our exact house (it is a new build) has been put up for sale across the road. They have put it on for £400k but do not have any of the extra finishes that we do. We have amtico herringbone flooring, Sharps fitted wardrobes in two rooms (one is 6 doors long), Venetian blinds throughout with shutters in the lounge and perfect fit blinds in the kitchen from Thomas Sanderson. We've added a utility room. We've done the garden (theirs hasn't been touched).

We know it's mainly about floor space but do any of these things add to the price of the house? If so, do you think it makes sense to also go on at £400k as there will be a direct comparator?

Our first time selling so lots to learn!

It’s good that you understand the market is tough so have adjusted your expectations. They possibly haven’t if they are listing at 400k & their house is less desirable.

It’s interesting that both EAs have given you a range - that suggests to me they think a fair price is around 375k but don’t want to sound too downbeat in case you list with a competitor who values it higher.

I think I would list it at 395k. If that figure is too low you should get multiple offers. However it probably is in the right ballpark amount which means that the other house will struggle to sell & end up getting reduced.

A couple of other considerations.

The quicker, more motivated to sell you are, the lower your guide price should be. A lower guide price is more likely to attract competing offers.

If the other property is directly opposite you then does one have a better orientation?

Generally, the decoration adds no value to a property - Zoopla wouldn't value it differently to the other. But given two homes of identical type and situation, a better decorated one would sell before the other given the same price.

In your view, if we list at £400k is that much different to £5k? As I imagine buyers are going to try and negotiate anyway!

@XVGN we want to move around Aug-Oct ideally but could wait until early next year if we didn't get the price we wanted. The very latest at a push that we would want to move would be next summer.

They look out onto the main road whereas we are set further into the estate. Both house surrounded by plenty of green though.

Thank you!

Here's yet another view of forecast house prices with regional variations.

Unfortunately, whilst they think they are industry experts, they are completely wrong about pre-forecasting land registry prices by 3 months. They have ignored the lag in reporting. Novice error.

https://propertyindustryeye.com/uk-house-prices-predicted-to-fall-again-based-on-recent-sales-agreed/

I wouldn’t want to look out at a main road @Mover2024 so your house sounds better to me in that way too as well as the improvements you have made. As @XVGN says though, a better decorated house doesn’t make as much difference to price as you might think, it just sells quicker.

EAs do tend to value on the high side. Therefore, I think it may be better to list at 395k. Though what do I know? It’s just a hunch. You must do what you think best.

@Twiglets1 @XVGN thanks both. Will wait for the final valuation (will update) and then discuss with DH. Going to go up in two weeks time so lots to do!

From your feedback it sounds like you have a superior home and can wait a while to sell and so you shouldn't necessarily undercut the other.

I forgot to ask. Are you trading up? And do you have some reasonable equity - 20%+? If so, then waiting a while to see how your market works out won't be too much to your detriment - in so much as the next home up should fall by a larger absolute amount than yours - if that is what the market does while waiting.

@XVGN yes, trading up. Looking for houses around £650k but can go up to £700k. Would rather not as we want to buy somewhere to do up ideally.

If we sell for £400k we would have about £90k equity. Good point actually