What if there just isn't another property boom coming? Everything frozen where I am

[livelaughlambada]

I know it's not possible, but I sort of wish all house sellers would collectively agree to knock 10% (or whatever it would take) off their asking price. It feels like loads of people know their houses aren't worth what they're asking, but won't drop because the house they want won't drop either. Feels like the whole market where we are (south west) has frozen solid. Also round us, there are SO many older people trying to downsize who've been told that their houses are worth X when there just aren't that many people with X to spend! And lots of these houses have been on for a year, and in some cases you can see the deteriorations, but they just won't accept the prices have dropped. I do think it's really interesting in that the 65+ generation have seen so many booms and busts that I don't think they can process that there may not be another boom coming -- as in I just don't think there are enough 30 and 40 something with X to spend. It all just feels a bit weird right now.

My comment meant to say 20s not specifically 29. It’s still better to get on the house younger as opposed to waiting for an inheritance later.

In my area 2 bed houses are selling really fast. My DM house had 2 offers for the asking price on the first day of viewings and so did her neighbour. But larger houses aren't.

It doesn't get distributed fairly either

Recent inheritances I've known in real life:

2 examples where the house went to the useless sibling who "needed it more" due to being feckless and job shy and living with parents. Other siblings got consolation prizes like cars or caravans

1 example of a BIL blowing it all and then the other siblings lending money they'll never get back to bail their sister out of the mess after the divorce

1 example of siblings fucking up the sale, because they didn't want it sold but they also didn't want to maintain it and they didn't want it rented out. It's still unsold with the sensible sibling trapped living in it to keep it from falling to the ground

It's a bad financial plan is inheritance

This is what I see too

There aren't many terraces where I live but they're the ones getting their hands bitten off, them and smaller bungalows

The bungalows that were converted into huge two story situations 5 / 10 years ago are not selling, but the compact ones are

This talk of inheritance. In my sample size of 2 the anticipated inheritance IS the house. Both my parents and in laws have been retired for 20 odd years and have a good 10 years plus in. They’ve been living off their pensions and what savings they had for 30 odd years. If I was counting on an inheritance (I’m not. Huge families both sides) their estates are their property. If that property is no longer selling for £1m+ but more like what you’d expect a family house in suburbia to be worth then there goes the inheritance.

A boom is only sustainable if enough people can buy house / pay rent on their wages.

The mortgage multiplier ratio to earnings is the relevant point here.

Just because the population is growing doesn't mean to say demand for houses will continue to rise. Instead may see a trend for more over crowding and multi generational living.

With the march of AI and high rates of unemployment in the young there's also the real danger of wage shrinkage in the next few years as higher income middle class households are more impacted.

The market in the neighbouring towns is very similar and across the borough there's a greater sample size which shows the discrepancy also. This may well be one of the factors they have to rethink and whether it's better to be closer to us sooner and not as close or wait longer to be in the same town.

They wouldn't be looking to recoup their costs completely as all houses need work and personalisation etc but quite a few of them need work beyond more cosmetic and they feel that this should be more reflective in price. For example one of the houses needs new ceilings and joists throughout after a leaky roof caused significant water damage. The family have had the leak in the roof repaired but nothing in the house, they wouldn't expect the cost of the decorating to be recouped but they would expect to recoup repairing the water damage.

Repairing damage doesn't add value

That just comes under maintenance, even if the repairs were extensive and expensive

It is beyond maintenance, it's effectively rebuilding part of the house. It's not about adding value it's about what costs value to a house and I think this is starting to be missed with pricing. They wouldn't expect to recoup the cost of replacing windows for we we as that is routine maintenance.
In it's current state it is likely to be unmortgagable as it is not in a fit state to live in with no functioning bathroom or kitchen. It's doesn't matter to them as they would be cash buyers but they would need to be needing to live in the house

I've done that sort of major work Superscientist, and you don't make it back when selling. You get a much higher return on finishes even if it's polishing a turd.

I have noticed that people always fix on the top price they have heard for their house so if a neighbour in essentially the same house got 300k a year ago that is what they expect even if current prices don't match up. Unless they urgently have to move they will sit on it until the current market price matches what they have in their head.

I know of people wanting to move to easy to maintain and less isolating retirement flats but put off by the unjustifiable service charges that would even continue after their death for often unsellable flats (unsellable due to all of the costs and inflated prices)
e.g. https://www.bbc.co.uk/news/articles/ckgykp79ezyo
Better protection for owners and descendants would make such a difference. Scamming the elderly for their equity and even their descendants is something that younger people perhaps could help campaign against as it would be in everyone's interest?

So have we and the house price at the point of purchase has reflected the difference. For example our first house was £115k for a 2 bed 1 reception mid terrace. The same house 4 doors down wasn't in that state was £130k. Once the structural work was done it was valued at £130k.

I find it odd that you think a house that has a ceiling falling down should be valued at the same price as one that doesn't!

I don't

But I also don't think you "make back" what you spend repairing/updating a house to a habitable baseline, and when people get fixated on getting back their XX,000 thousand spend, they get disappointed.

You often make more on more superficial small jobs than on the huge structural ones which effectively "disappear" once done.

Nobody wants to pay more for a roof that doesn't have a hole, but they'll pay more for a second loo, even though the loo cost a tenth of the cost of the roof and ceiling repairs!

Value isn't what you put into a house.

When my DF is no more, his widow will be selling a beautiful waterfront Georgian terraced house in a harbour setting in a pleasant resort. He bought it in 1974 and has lived there pretty much ever since. There will be upgrades needed, but it is still a magnet that will set values for the street because the houses don't change hands often.

Ok, I think we are actually on the same page. I wasn't talking about adding value or making back money but having the sale price reflective of the work necessary. Say it needs making structurally sound, a new bathroom, new kitchen, decorating through out. The difference in price would reflex the £30k of the £100k that would be necessary to make the bare bones of the house back to what is classed as an acceptable standard but the cost of making the house your home would not.

Edit: Or to put it another way you don't make your money back by adding value but by removing an aspect of negative values

We took our lump sum from our SIPP at the end of last year, because we were concerned that the rules would change and it would be taxed. We promptly gifted 80% to the DC, who is in the process of buying a small house. It will not involve a mortgage, as the GParents estates were also passed through by deed of variation. We just have to live another seven years before it falls out of the HMRC frame.

Maybe

Seaside resorts can be tricksy

They swing between being very deprived and being very saught after. The historic demand is no indication about which way they'll go from here. When seaside resorts turn downwards it's a fast steep decline!

People are always looking for the next "on the up" coastal town, not necessarily the one that's had it's hay day.

There's plenty of boarded up stunning architecture on coasts up and down the UK, some of which were booming up until very recently.

Coastal sounds like a safe bet, but it's not, it's a tricksy pendulum in practice

Same where I am, houses have been on the market for more than a year. They don't reduce the price, just move from "offers over" to OIRO or change agents so they look like "new" listings when in fact have been on the market over a year.

By me though probably the last kind of houses you buy as a family having moved up a few times, before downsizing after retirement, so price wise not easy to sell.

In this instance @Treetopssofee , the coastal resort has been a destination since the 1820s. The inner harbour is a Georgian treasure landscape, and if you are a sailor, and get in with the right people, you could get a city centre mooring a few metres from your front door. It might not float your boat, but there are a lot of well-to-do people who like sailing who would pay handsomely for the convenience.

I think lots of people who can, are doing this. My family member who saw a financial advisor who mentioned similar things

You can also get around the 7 year thing if you can show that the money given away doesn’t effect your quality of life. You can set up regular payments if it doesn’t mean you aren’t going without. And you can give direct payments to things like holidays, music lessons etc etc on top all without it being counted.

Of course I hope you very much live past that though! :)

Bought my first house in the 70s. It was a doer upper and we treated for damp, new bathroom, new kitchen, new windows, all decorated and carpeted. Due to family reasons we needed to move a year later and it was worth just about what we paid for it so we were very much in negative equity. We sold a year later for £1,200 more than we paid so didn't cover what we'd spent but the house we moved up to was also alot less than it would have been two years earlier. There have been other booms and busts since.

If you know what you are doing, you do make it back, plus profit. But you do have to know what you are doing.

You can if you don't need to outsource and do it with profit and resale in mind from the start

But when we are talking about people's residential homes, "making back what I put in" is a recipe for disappointment

As I wrote above, some DC will benefit from getting inheritance and pre-inheritance money at the right time. DC has £330k, from two sets of grandparents' estates, plus money (that we are unlikely to need) from our lifetime pension saving plan. It's not going to do anything more than buy a modest 2 up 2 down Victorian cottage in a pleasant small city centre.