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!

However 2 years into that 4 year crash the prices had already reduced by a lot more than the marginal decline we’re seeing now.

i think it’s looking likely (not certain) that the predictions of a market correction through price stagnation for a period of time, is what we’re actually seeing

id also hypothesise that in the 90s not everyone was on a variable mortgage rate so, like now, there’s a delay in increases filtering through. Without data I’d not like to say whether there’s a greater proportion fixing now vs then

Yup I agree

Fixed rate mortgage were introduced in 1989 so in the early 90s the vast majority were on SVR. No one was on an old low fixed rate.

In 1990 the average SVR was 14.3% and fixed was 13.75%

Isn't it something like a million mortgages this year that are going to end their low rates.

I wasn’t aware they were that relatively recent, so yes fair comment on the potential impact now not being a factor then

Yes I’m one of the million ending an extremely low fixed rate this year, only a tiny mortgage in my case though

The effects are entirely visible. I posted a link with prices by region and home type. It's easy to find examples up, flat and down, i.e. the picture is very mixed.

I honestly can’t be bothered to keep going over the same old ground. Yes, the picture is mixed by regional variation and property type with flats in London for example being worse affected than houses in Yorkshire. And there will always be examples of big price reductions on individual houses no one wants for some reason, but individual properties are statistically insignificant.

No region in the UK has seen prices crashing. The ONS is just more evidence of the same picture being shown time & time again via different sources. But if people choose not to believe the evidence & keep saying it’s too early to see the crash then that’s up to them.

Yes, and Otto.property - the one I used to indicate the variability of price rises and falls, and of course - houseprices.io - my goto to assess property and area for price data.

The complaint to the BBC is in. I await their usual measly reply.

Rightscore looks very gimmicky to me.

"Thought leaders"

If you like a house, ticks the boxes, you can afford it, you buy it.

Looking up scores of data trends and trying to predict the market will have you chasing your tail in an endless loop of fear and uncertainty.

Ok @XVGN & I will concede the bet as they didn’t mention it in any meaningful way.

Totally agree with this - you can have all the stats up your sleeve as you like, but if the seller doesn’t want to sell at the price you say it’s worth that’s the end of it.

Totally agree with this - you can have all the stats up your sleeve as you like, but if the seller doesn’t want to sell at the price you say it’s worth that’s the end of it.

The end of it for the seller maybe, but not for the buyer when there's a hundred similar properties within a 5 mile radius.

There never are a hundred similar properties within a 5 mile radius for sale though. Buyers don’t want just any old property, most are discerning and struggle to find properties that match all their requirements at the budget they have available. Even just looking at Mumsnet shows us that buyers feel there is not enough good stock on the market.

For most people, they offer on one house in particular because they strongly want to live in that house. It’s not all about the numbers. It might be for you, which is great, you trot on to the next house and squeeze it down. My recent experience is that the desirable houses are going quickly and near asking. I wouldn’t want to live in the ones that are hanging around - even if they knocked 20% off - because they’d probably need £200k renovation work to be how I want it - and that’s if there wasn’t some immutable factor (like being in a sub par location). I’m not interested in either of those things, so would rather buy a desirable property at a reasonable price. I’m then also confident when I want to sell it I won’t struggle because it’ll sell itself, no matter the state of the market.

Just done a property search on rightmove within 5 miles of my address there's 475 3 bed+ properties (not including flats) between £250k and £400k

But then I thought I better check the average price for the area and it's £454k so I upped the search to £450k and now there's 701

But yeah that 1 elusive property is the only one you're interested in.....

Oh and just incase you want a more elusive higher priced property I've just upped the search to max and there's now 2631 properties

No one has a budget of £250- 400 though, unless you’re at the top end of that and happy to do renovations.

far more likely you’ve got a budget of £350k, want a garden for kids, no box rooms, a garage for crap, two bathrooms, semi detached and a nice light filled house near to a decent school.

Redo your search and see what that gets you. That’s our budget and list - we’ve got 5 properties we’ve found that suit the bill. None of them near the school we want, and we live in a cheap part of the U.K.

People don’t want any old 3 bed property though plus search areas are normally smaller than that due to wanting property to be in certain catchment areas or within walking distance of transport links or on a quiet road or a desirable road or a dozen other permutations unique to each buyer.

@XVGN how accurate do you think housepirces.io really is as ive heard a lot of people cite this is the website to check for validity of asking prices.

The reason I ask is I have looked at my house which has sold for £50k less than they say its worth and the house I'm buying they recon is worth £201k more than I'm buying it for.

Im not going to complain with them figures if they are correct as I'll be making a killing, but to me it seems wildly out.

Well it's not accurate in the sense that it just applies a dumb RPI increase to the last sold price. That cannot take account of any major improvements, refurbishments or developments. It is also based on transactions agreed at beast 6 or 7 months ago and therefore cannot tell you what is happening at the coal-face right now. So you need to apply a rounded view and just include it as one of a number of factors.

I like to look att he other end of the market process too - what's happening right now in terms of what's coming on to the market and selling. The best place I have found for that is the UK Property Market Stats show on YT. You need to go with the flow in terms of sales speak and accept that it's mainly rolled up national stats based on dumb arithmetic averages but it is a good tell in terms of what may be coming down the pipe.

Thanks for the clarification. It doesn't matter to me about prices per se as a house is only worth what someone is willing to pay and I think we got a good deal on the house we are getting in an area we want to live and it hits all the non negotiables , it was more being nosey at the validity of the prices.

I’ve been using houseprices.io to look at new properties coming to market and it does add an interesting dimension to see how much they “should” be valued at based purely on square footage and what others have sold for recently in the same area.

It doesn’t take account of high end finishes for example so places that developers have refurbished look very overpriced when in reality they are probably just overpriced. But if I was a buyer right now I would be using it to argue my case if trying to get a good reduction (& keeping quiet of course if it worked the other way).

Did you mean houseprices.io or were you referring to that new chrome extension for Rm that shows prices per square foot?

Oh yes I was referring to the chrome extension, sorry.

House prices.io is useful too though