Properties on for £800k+ not selling? Why?

[MuckyBrass]

Near me, there are loads of houses on Rightmove for around £800k, £900k, even up to £1m ish which have sat on the market for a year or two. I've long been desperate to move to a bigger house so I check Rightmove all the time, but my budget is more like £600k so I've never viewed any of them, and really I'm just being nosy. They are all lovely houses, I'd buy any of them in a heartbeat if they were on for £600k. I don't understand. Are they really for sale? Or are they just sitting on Rightmove as pretty houses to make the estate agents's rosters look good? Some of them have had their prices reduced by £100k or even more at various points, but they're still evidently not selling at the £800k plus mark.

I'm in a small (but fairly naice) market town with no train station, not an easy commute to any major city, so I actually struggle to think who would be earning enough or have the cash around here to be the actual buyers for houses in that price bracket anyway. We're not talking loads of land, either. These are normal town houses, period properties mostly, small gardens, 4-6 bedrooms.

You’re right @Binus and the inheritance would usually be split among more than one child so the baby boomer estates will be broken up and sold off… but to who?

True, but generally when it's too late. My parents are atill (thankfully) alive and kicking. My 4 children have either flown, or will fly, soon. My siblings are fast approaching mid to late 50s. So again, inheritance won't be spent on a family home.
I'm not complaining about the lack of inheritance, just pointing out that it doesnt really help the housing situation.

They want work life balance. Previous generations just worked harder if something was out of reach.

I agree property is expensive but surely that should encourage more work not less work. It makes no sense.

I’d give it Straight to grandchildren

But Im my case my parents had us late so we inherited relatively young

the market has been propped up for years and wasnt allowed to take a big correction that was due or needed in 2008 with help to buy etc

There is a big gap between people that are mortgage free and those that are not or in rented

Supply and demand will ultimately drive prices one way or another

Stamp duty is a killer and not insignificant

Average house prices around me are 9 x wages in terms of affordability

I suspect the problem is nice 2 beds with a bit of garden and a garage (not sure why we need garages, no one ever parks in them.) Take up valuable land space. Which means they arent financially appealing to builders i guess. So unless a planning law insists on a portion if new estates including these houses, it won't happen. The very least we could do ia make the apartments for oldies appealing. Personally (aged 48), if the over 55 flats were cool I would consider getting one. They're often not mich more than 100k around me. It would free up lots of money to allow flexible working, travelling, and even potentially a second home somewhere warm. But they're awful, so it's a no from me for now.

One does hear of that happening, but people who are inheriting substantial estates when parents die tend to be middle aged to early pensioner age. My guess is the majority are probably in the 45-65 bracket. So the older ones in particular often still have decent, defined benefit pension schemes. As time passes, ever more of the middle aged inheriting population will have inadequate and/or defined contribution pensions and will have greater need to funnel inheritance money towards their own retirements.

I agree property is expensive but surely that should encourage more work not less work. It makes no sense.

It's not just a case though of get a second job and you can buy, prices have gone beyond that. In any case also, more work if you were able to say, get a promotion, can push you up into the next tax band as taxes on workers are pretty high now. People in their 20s might be thinking about childcare costs too in future. Things are really dreadful in some parts of the country for that age group now.

Bingo! The very first post on a thread about unaffordable houses mentions boomers. Ah, these people born with silver spoons in their mouths in the postwar years and have sailed through gilded lives ever since and are now selfishly sitting in huge mansions with enormous piles of money. People of all ages need somewhere to live and most people live in fairly modest houses whatever their age.

Just getting angry and saying boomers don't own a lot of the country's housing wealth doesn't change the facts.

They are too expensive for many people at current mortgage rates. We were about to buy and 810k house a few years ago. Convinced ourselves we could afford it and then interest rates went up and the mortgage payments were going to be absolutely all our spare cash. We pulled out and have just brought one at 100k less on a slightly lower rate. Even then we had nearly 50% cash to put towards it with two good full time salaries. As it is we won't ever pay it off before retirement. Just have to hope someone will pay enough for it for us to pay off the mortgage and downsize.

I have to say the running costs of a bigger house are quite a shock too. Starting to wish I'd stayed in my too small but totally paid for house.

Correct in my case. I would love for my kids to inherit a sum of money directly from their grandparents. But the truth is we will likely need it, if we get any, to help towards retirement. Hoeever, I am adamant that once we have proper financial security, we will be helping our children in every way we can. Financially, child care (if required), around the house. My parents retired young (50s), with a decent pension and happily spent it travelling, golfing, on holiday homes etc. Not much money or time came our way. Which is fine, their life. But it's made me consider how we will live and give to our kids. I dont forsee us buying a big old family house.

Not sure if you're on a wind up, but in case you're not, and actually even if you are since this is quite an interesting topic regardless...

People need to be both willing and able to buy in. It has to look like it's worth it. A pp has covered affordability, but also even those who do have the income don't necessarily view property as a worthwhile and desirable investment. I think most people do still want to own something, but there's more awareness now that you can go wrong as well as right with property as an investment. We've all seen what's happened to average flat prices, for example.

As an example, DH and I, millennials, already own a property suitable for our needs and only costing about 10% of our income. Granted, we don't want to move, but also a more expensive house isn't as attractive an investment as it might've felt a few years ago. There are more flexible and attractive investment options if we want to do that, and it's also nice to have more income available for other things or just peace of mind.

It is also quite satisfying, when one is a member of the generation who are supposed to be propping this thing up, to do as little as possible of that. I wouldn't let it stop me from buying a more expensive property if that were actually something I wanted to do, but it's a fun upside of not being arsed for more space.

@BrownTroutBluesAgain I am well aware of what affordability calculators might say but that’s not the same as actually being able to manage day to day. I couldn’t sleep at night if I had a £400k mortgage hanging over me and the repayments on that would easily eat over 30% of our take home income and mean that our earnings would have to stay high until we are 65! Salaries tend to peak at 47 according to data (I’m 45) so I’d expect that I won’t maintain this level of earning long term. Jobs are volatile and job security is low. I guess it’s all choices but it feels very high risk!

Indeed it's complete nonsense. The issue is wage growth v house price growth.

It's all about the average wage to average house price ratio. A couple of decades ago it was much more likely to be X3 - 4 the average wage. Now? It's insane.

Working a couple of jobs doesn't solve the problem.

I said someone would be nearer their goal of purchasing a home by working more hours cand years. Yes it is more difficult now but working less hours and less years makes it even more difficult!

I wasn't talking about property for investment.

Question about inheritance tax - if someone inherits a house worth on paper, let's say £1.5 million. They only have 6 months I believe to pay the IHT. If the house takes a long time to sell, and only sells for let's say £1.20m, but they've paid inheritance tax as though it were a £1.5m house. What happens then? Sorry if I've got this scenario all wrong!

It’s probably the council tax band, if they are a F, G or H then no one will go near them at the moment because of the pricing changes coming up.

Oddly I saw a lovely £850k house the other day which was a G (so dismissed it) and then a £1.3m house which was an E - in the same town! How??

My guess is that the tax is based on the market value of the property at the time that it was inherited.
(Which could make things very tricky!)

You're 18. You leave home. You rent. Your rent is huge. You can still barely pay it. Have you seen how much rent is? Saving whilst renting on minimum wage??? Good luck. If you work a second job, its almost certainly going to be mininum wage too. Thats a bit more in the kitty, but realistically you are still going to struggle.

The fact is that people are buying houses later as it is - because they can't afford to get on the market sooner - and this is impacting some on the length of mortgage they can have.

Rental prices just as much as mortgages are part of the issue here. Rental prices were comparitively much lower.

If you are lucky enough to be able to live rent free with your parents, you still are going to have to save for much longer. I know people in this situation who - because they were single - were unable to be afford to buy locally. They are on very good, above average wages. 20 years ago you'd have been able to buy around here on that. Now you can't.

Don't give me shit that you should just work longer hours. There are only so many hours people can work.

You pretty much have to have TWO professional good jobs to buy a small three bed round here. 20 years ago one professional good job was enough to get a large four bed and support your partner and kids in early years.

Thats really not a case of 'you should get a second job in your twenties' type issue.

Honestly. I sat down and wrote all the figures based on the local averages a few years ago.

Then I showed it my local councillors who were still blathering on about working harder and building big executive homes in the area.

They went silent at the figures I gave them. None of them had been arsed to actually look at the numbers. When confronted with it in terms they couldn't argue with, they suddenly got it and understood that there was a need for smaller 3 bed houses that people age 40 and under could actually have a hope in hell of affording.

It was somewhat satisfying seeing the penny drop.

Mysteriously guess what the estate built last year mainly is and what the local councillors are pushing for.

You apply to get the overpayment back
The best thing to do is to put the house on the market prior to getting probate.
It gives you a little extra time before you have to pay IHT
We did that as did our cousins

Given the current 16-20 weeks wait for a property sale to go through once an offer is accepted Tjeres plenty of time
This of course assumes that probate is with a will so goes through quickly

That could leave someone very out of pocket or help them hugely if the property sells for more than the valuation...interesting.

Maybe she thinks they should be sent to work down the mines aged 13 and grateful for 1 bowl of gruel per day?

There are definitely some people who feel property ownership is completely unrealistic for them and therefore don't waste their time trying. It can make a lot of sense, actually, especially for those who are so low paid that state support is a relevant consideration.

People forget that even in previous generations not everyone was a homeowner. The examples you have given wouldn't have owned property then either. Nothing wrong with that then or now.

I am referring to those who have the prospect of home ownership. It still involves sacrifice and effort.