[Wig]

Chatting to a couple of colleagues over lunch today.
Both London based, one just bought a house in Wimbledon somewhere, the other looking to sell their flat in Islington.

Few choice quotes:

“It is such a sellers market at the moment”
“I read there are 18 buyers to every property on the market at the moment” (in evening standard apparently, although sounded suspiciously like EA bullsht to me)
“the prices just keep on going up – its ridiculous I’ve made £175k on my flat in the last five years” guy who’s looking to sell it which was followed by
“the only problem is I could sell my flat instantly but I’d have a nightmare finding another one to buy”

I tried to explain that the £175k wasn’t actually profit unless you were able to realise it as surely the price of whatever you’re looking to move into has gone up by at least that? But it honestly did not seem to compute. The entire concept of rising prices creating equity to move into a bigger property is fatally flawed as the next property will have increased in price exponentially surely…

I was a bit gobsmacked to be honest, all delivered without a hint of irony (or delusion?) it really seems to be a total alternate universe. Real eye opener to hear first hand. I tempered the conversation down with the fact that the rest of the country is falling and it really is a buyers market outside London etc. (and probably SE) which was met with complete surprise. Like the concept of falling house prices was a completely foreign concept.

Has all the hallmarks of bubble talk to me!!…

[catmandu]

As they say, when the shoe shine boy starts telling his customers how much he's made in stocks and shares, it's time to get out of the market!

[thejaksie]

well I have just taken an offer on my place in E1W

On the market since April 2011 so on market around 10 months. Asking price was set as what I paid in 2007 + cost of lease extension + kitchen + heating upgrade, lower than what 3 EAs said it would go for.

Around 40 viewers over that period. 3 offers in 10 months as follows:

1. 95% of asking (accepted fell through)
2. 80% of asking (rejected)
3. 93% of asking (accepted)

What I have accepted on the nose is what I paid in April 2007, and I have lost around £20k in lease extension and kitchen. clearly no profits there since 2007- if I hadnt done the lease + kitchen + upgrades I would have lost 10-15% on 2007 price for sure.

the market isn't booming outside the most central central of west london where people are still flying kites.

In my opinion the london crash will start east (stratford then canary wharf) after the olympics and quickly engulf all areas west / north /south thereafter.

As you can imagine I am extremely happy to exit the london ponzi scheme at 2007 level and will look forward to renting going forward

[guitarman001]

+1, refreshing to hear, thanks for the honesty.