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!

Same here.
We’re getting decent interest on our savings too.
Prices are dropping and a fair few houses going back on the market. Cheshire.
Glad we didn’t buy in the last 2 years tbh.

"We’re getting decent interest on our savings too."

Makes a nice change doesn't it after 12 years of getting bugger all. Long may it last 😉

Same

I'm on the south coast and live in one coastal town and work in another 15 miles away and both towns had massive increases during the stamp duty holiday with all the London money buying 2nd homes and now there's many roads with numerous for sale boards up.

Some of the nicer stuff "sells" straight away but then sits there for months SSTC before coming back on the market. The houses which need work or have any issues at all, like a downstairs bathroom or being an ex BTL are not selling despite dropping 10-20% and then they go to auction and still don't sell.

A couple of my workmates are in the process of buying, they're late 20s, single males on a good wage buying their first properties. They say they've got bargains as they've been spoilt for choice and if the seller refused the offer there was another 2/3 bed terraced round the corner that would accept.

Please would you do me a favour and point out what post code area and house type you are seeing this. You can use this as a reference.

https://otta.property/trends

I think is an illusion though? Because inflation is so high, so your money is devaluing even though the interest rate looks decent?

Everyone experiences their own personal inflation rate - typically higher for lower income groups and less for the wealthy.

Right now, the "average" person can get more in interest (5%) than the quoted inflation rate for CPI (2.3%) so they are currently getting real growth - not devaluing.

Halifax index is out. I wont bother reporting it because it's pretty meaningless - only 15% of mortgaged properties - no cash transactions, etc. Better to look at actual data from Otta.

But even their analysis is flakey. Amanda says "set against a backdrop of a limited supply of available properties" but then a few paragraphs later quotes from RICS, "April 2024 show a continued increase in new listings with average stock levels at a three year high of 43 properties per branch."

For anyone interested in the Halifax price index the main points are:

Average house prices stable in May, down just -0.1% a monthly basis
Annual rate of house price growth up +1.5% last month, from +1.1% in April
Typical UK home now costs £288,688 (compared to £288,862 in April)
The North West is the strongest performing nation or region in the UK, where house prices grew +3.8% on an annual basis in May.
Northern Ireland continues to show strong growth, up +3.2% in May, pulling back slightly from +3.3% in April.
House prices in Scotland also increased, with a typical property now costing £204,952, +1.9% more than the year before.
In Wales, house prices grew annually by +0.7% to £219,483 (vs +1.1% in April) Eastern England recorded the largest decline in annual growth across the UK. House prices here now average £329,853, down -0.8% in May.
Unsurprisingly, London continues to have the most expensive average price tag, now at £536,821, up marginally (+0.2%) compared to last year

https://www.halifax.co.uk/assets/pdf/may-2024-halifax-house-price-index.pdf

This is the LR data for the best performing post code in London. It really doesn't look like prices are rising on an annual basis.

Halifax seems to think prices in London have risen 0.2% (on average) compared to last year but all these indices have their weaknesses and 0.2% is pretty insignificant anyway. But that’s no surprise, prices in London were predicted to fall so I’m surprised if anything that the percentage isn’t greater according to Halifax.

Mad isn't it...

When the price of essentials such as food goes up it's called inflation and seen as a bad thing.

When the price of essentials such a having a home to live in goes up it's called "strong growth"

I see Labour intend to keep the house builders in profit and the price of housing high 🫡

@happinessischocolate yes I don’t see Labour doing anything much different to the Tories with regard to property

Interestingly I've been regularly browsing the David Wilson newbuild houses on a huge new development nearby. Noticed today that they have actually reduced the prices on several of the currently available properties - not just increased "incentives".

Unusual

I think incentives can only be up to 5% of the purchase price before prices had to be dropped?

It’s always supply and demand end of the day

labour will help first time buyers but it will create demand…..this isn’t my first rodeo people I have seen it all before

Labour have started

https://www.bbc.co.uk/news/articles/crgg2jyz4ywo

Supply and demand is ofc a factor, but don’t we all want a 5 million pound house?

God no.

Think of the council tax!

Think of all the bathrooms to clean! 🥴

Of course it's supply and demand, but what changes is the affordability of the buyers and sellers.

Buyers can't afford to borrow as much with higher interest rates and more sellers are struggling to pay the higher interest rates, so need to downsize.

There's more supply than demand in the south west at the moment, so prices are going down.

Labours plans look like they're just extending the help that the tories have been giving since 2021 so that's not going to increase the level of demand.

You're not the only one who's seen it all before, but the government won't be able to afford to prop the market this time.

Yeah, rookie error here. It's not just Supply and Demand. It's Demand and Ability to Pay. Guess what has happened to the second factor.

Anyway, still waiting to learn which post code is seeing the price rises you are seeing. I've given you the actual data to work with.

no sign of this crash then 😂

It's supertanker stuff. It takes a long time so no immediate crash is expected - just a long slow decline. Anyhow, London West is now down 13% from the peak. That will ripple out over time. What's your definition of a crash?

Slow indeed … that supertanker has apparently been turning since 2022 and we don’t see particularly noticeable falls in most areas