25% increase to asking price since last sold… very little change to property

[Whatdafudge]

Just wondering if a 25% price increase is a lot / normal since last sold price in early 2019.

The current owners/sellers have knocked through a small wall (doesn’t look to be load bearing) so you can access dining room from kitchen. They have also painted/decorated internal rooms. This is all the work they have done to the property.

Most of the work to the property seems to have been done by the owners before the previous owners.

I know prices have risen but 25% increase in 5 years. Or maybe this is expected / the reality now.

Not at all… I totally understand how you feel

First time buyer. Ideally I’d like houses to be for housing people and not investments.

Yep this is true.

There are a lot of homeowners just clinging on at the moment desperately waiting for mortgage rates to come down.

I understand that and I am sympathetic to that too but not sure what that has to do with my thread. I’m talking about the rate in which house prices increase.

@Whatdafudge I get the impression that you think existing homeowners are somehow luckier than you and are simply getting richer and richer for doing nothing, the situation is more nuanced than that.

They are mortgage borrowers or mortgage debt holders, not really homeowners? Legally they are yes, up to a point, but legally if they dont meet their debt obligation they dont have the same rights as someone who actually owns their home outright, confusing the two was another mortgage industry trick which I find annoying because it panders to the less financially aware sections of society.

Nope, not the case, wrong impression. Believe it or not I don’t just live in a bubble of FTBs and have many friends and family members who I'm happy for on the property ladder. But it just seemed shocking to me that a house would increase that much. And maybe it’s less shocking if you already own a house. Just because I'm saying it’s hard for first time buyers doesn’t mean that those who own property will not have other separate issues to deal with but again, that’s not the topic of this thread so not sure why you even felt the need to make that jump and make such presumptions about me

36% of homeowners own outright the rest have loans of some kind. The reason house prices are where they are is in large part because of mortgages being available.

There is nothing shocking about an asking price going up 25%, who cares, it doesn't matter what asking prices are.

Well no, nothing shocking to you. And that’s fine. Could have just said that in the first place. Thanks!

But it just seemed shocking to me that a house would increase that much. And maybe it’s less shocking if you already own a house.

What I'm surprised at, if you are in the position of being a ftb, is that this is a surprise to you.
One of my dc is buying at the moment. They didn't just wake up and think 'I fancy buying a house' - they have been keeping an eye on properties for a long time.....(whilst saving)...... so are aware of what has been happening to prices. They have also been having conversations with other people they know who are looking, or who have bought in the last 5 years of so. They can see how prices are going / have been going. You don't need to find a house in the same road that has been sold, you consider ALL the properties in the wider area. It has been clear that prices have gone up (in our area) around 25% from 2019 - well that they went up more than that but are now more open to offers.

No I didn’t just wake up and decide to buy. I wish. I have been saving for years but I haven’t been keeping a track of what’s been going on, just saving, knowing one day I will likely want to buy. Now I’m comfortable with my savings and job I’m starting to look at it a bit more. Don’t get me wrong I know houses go up, I believe in one of my previous posts I said this. I just wondered with everything going on with interest rates etc is this still normal or not. If that’s a normal increase that’s fine.

Have you tried using the Nationwide House Price Index to check it by postcode? https://www.nationwide.co.uk/house-price-index/

A local estate agent told me this was the most accurate measure of how much house prices had increased since I’d bought my house in 2017. Having said that, she gave me a very low ball valuation, I went with a different agent and achieved a much higher price, so what does she know? 😁

My partner bought our previous property in 2018 for 100k we sold it in January for 123k. 25% rise seems about right for the current market to be fair. He'd done nothing to the property since buying it.

I just wondered with everything going on with interest rates etc is this still normal or not. If that’s a normal increase that’s fine.

Which takes us back to the first few replies. It doesn't really matter what is "normal". There are odd times over the decades where quite 'abnormal' things happened. They still happened, even though they'd not happened before, or not to such an extreme, or not commonly. Since I first started looking for my first property, I've known times when prices doubled in 3 years. I've also know times when prices absolutely crashed and many lost their homes, or were stuck unable to sell because of the negative equity. I've seen mortgage rates go from 15% down to the miniscule rates of the last few years. What you, as a buyer have to look at is
How much can I borrow? Can I still afford that if interest rates went up 2, 3, 4, or 5% more?
How much have I got saved?
Add those two together, and then look at what can I get for that amount, within the distance I'd be prepared to commute to what is important to me (work, generally, but it might be other things for other people).

Looking at what the present owners bought it for is just going to tie you in knots, as it really doesn't affect what it is worth now.
Some people will pay a premium for a nice view
Some to be in the 'right' catchment area for a school
Some to be in a quiet location
Some to be in walking distance of High Street or Bars
Some to be within walking distance of station, or near a motorway junction
Some to be nowhere near a railway line or motorway
Some for a period property
Some for a sleek modern kitchen and big bifold doors
Some for a quirky cottage with tiny rooms
Some for all open plan
Some for a driveway and good parking
Some for a semi over a detached.

You have to look at all sorts of different options and narrow down what is important to you. Once you've started looking at local estate agents properties, and then Rightmove and Zoopla for a while, you begin to get a 'feel' for the value of properties at the moment that are in your wider area. Then you can start viewing them and that gives you an even better feel for what you will and won't compromise on.

You'll struggle to find a house that hasn't increased similarly in value. Remember the house the seller is moving to will have likely also increased in value, they aren't making money they just need more to make their onward purchase. Its likely that by the time you come to selling, house prices will have risen again.

This is the article I mentioned earlier https://www.thisismoney.co.uk/money/mortgageshome/article-12199051/Which-counties-seen-house-price-growth-2019.html