red

see my post above - prices holding and in some cases rising here, sadly...

Similarly, all it takes is for one cash-rich fool to buy a place at asking price in a decent area to make all other vendors hold out for their absurd asking prices - or even up them, as they're doing around here (N London), where the madness continues unabated...

Not so much a bounce here, just more of the same...sadly, that means prices holding firm and in some cases rising. Since IR cuts, hardly anything on the market, hence prices of decent stock back to pre-2008 crash levels. Just made offer on house for 65K more than I did back in 2008. Rejected outright as vendors has offers near asking...150K more than those properties were going for in 2008. That's a serious increase and what's worse, people are paying, encouraging other vendors in the area to hold firm on their prices - or in some cases, up them. Fecking depressing.

Had this discussion with a friend recently - if / when rates rise substantially, will banks raise their lending rates with the same margins they operate at now? Can we really expect to see, with base rates at 5%, the average (80% LTV) mortgage going for 8-9%? I don't know of any tracker at the moment less than 2.3% above base, and that's with a 40% deposit. Most seem to operate at around 4% above base. This would obviously mean carnage for the market - well before rates got to 5%, too... Your thoughts?

Hmm. Hard to predict given the complex means by which they calculate the monthly figures.

Exactly what I'm seeing around here - one sale goes through on a particular road then the rest in the area jack their prices up in the hope of matching it.

Oh, RB... with all due respect to where you live - and I'm glad you got such a huge discount - prices are most certainly not tumbling in my part of the 'sarf'... And the EAs aren't having to work hard to see any decent property go straight under offer for near asking (around peak 2008 prices). IR rises, please.

House is empty

The point is, why should I have to ring them?! They are acting as agents in a sale transaction of a serious amount of money and they can't be bothered to keep all interested parties in the loop. It's a fecking disgrace.

Mrs Red and I made an offer 15-20% below asking price for a property last week. EA (slimy 30-something) said it wasn't the highest they'd received but as we're chain-free, big deposit buyers, we might have a chance. Through gritted teeth, I was as nice as pie to the idiot, who couldn't answer basic question about the property, proving that they are indeed a total waste of space and an unnecessary evil in the whole house-buying process. Anyway, the offer was made Thursday morning, by email and phone. He said he'd put offers to the vendor that afternoon. It's now Tuesday. We've heard NOTHING. Not even a courtesy call to say why the delay. You offer over half a million pounds of your money to buy something and the person responsible for overseeing the transaction can't be @rsed to let you know what's going on. I am desperate to call the manager and give him an earful for appalling customer services but know I'd blow my chances of getting a property through them in the future. It strikes me as a perfect example why the EA industry needs greater training and regulation. How can an ill-educated, irresponsible moron lacking in basic communication skills be so instrumental in the biggest financial decision anyone is likely to make in their lives? And what do I do to vent my anger...? (Edit for naff spelling)

My guess? 0.7% fall. Not that it means a fish's t!t around here where silly season appears to be in full swing. Asking prices exceeding 2008 peak...all it takes is one vendor to sell and the rest hold firm expecting the same. With no pressure to sell, they're sitting pretty.

nice...

Yep. Low IRs and ZIRP-like schemes will keep over-stretched 'owners' in their homes, meaning no short, sharp crash, I fear. Which would be better for the economy in the medium-long term - but since when have politicians cared about medium-long term policies? Keep the plebs happy in the short term, get re-elected and on we go...

Here in London N2 there are simply not enough properties coming to the market and all it takes is one over-priced one to sell and the rest dig in for their absurd asking prices, hence very little movement. We just made an offer for a 3-bed ABOVE what we made for an identical place during the dip in 2008 - no joy. It's gone for near asking price. As I keep saying, until the forced sellers return, it'll be a painfully slow grind downwards - in desirable areas at least...

I've been trying HSBC calculator: https://mortgages.hsbc.co.uk/how-much-can-I-borrow/?step=0 For 30 year old earning 28K with 25K deposit, you can borrow 98K. So that's exactly 3.5 income, innit? (3.5 x 28=96)

precisely what I was thinking.

In 3 years' time, if rates have climbed above 4%, I'll fix. And by which time I'll have paid off a large chunk of the mortgage. Not ideal, but as I said, it's not just about money any more.

You're on the right track...we've just had a baby. Living in a rented top floor flat with no garden and barely room to swing a very small cat has been fun as a couple, but not any more. And mortgage would only be another 200 per month for a big 3 bed house. Go figure...

I too am considering an offer on a place in the sure knowledge that it will lose value over the coming years. Sometimes the desire and need to provide a home for your family is simply stronger than rational, financial action. My criteria have changed somewhat - I can no longer wait for a perceived 'bottom' in the market. Provided I can service a mortgage at 4 or 5% over the next few years (I can get 2.29% with HSBC, so factoring in a few rate rises), during which I will be overpaying like a madman, I will do it.

I agree - and I think it's something to do with our property-mad philosophy: "You can't go wrong with bricks & mortar / renting is for second class scum / prices only ever go up / etc..." We have convinced ourselves that the 'norm' is to see prices rising YoY - it's our pension, after all - and when they fall it's panic stations.

yep.

Precisely the reason I'm so scared of over-borrowing right now. We can service a loan at 2.29% no problem - even 4% is manageable for us. It's a gamble, for sure, but my money's on deflation after the next economic dip becomes entrenched. The idea is that we overpay like mad in the first few years to eat away at the capital owed, before any potential big rate rises hit us. The Norwich & Peterboro deal allows overpayments...big up-front fee, though.

I'm debating whether fixing for two years is such a good idea - are we really going to get IR rises that would justify fixes when you can get 2.29% trackers from HSBC with no fees? (OK, it's 60% LTV) All depends on whether you believe the BoE who reckon inflation will subside within the next year...

Without wishing to be rude, I'm not interested in 'average' prices, since they appear to mean nothing when looking at my local area. Very little on the market, back to 2007 prices. And what good stock comes on is selling. It's going to take a serious catalyst for big falls in my area this year. Sentiment still too bullish. Yes, I believe prices will fall here, but I can't see things turning around this year to such a degree that I could afford to buy. Depressing and frustrating.

We've tried to arrange two viewings recently and the EAs never bothered to call back on both occasions. My level of contempt for them has grown so much since we started looking to buy recently that I can hear my own teeth grinding as they show us around properties making obvious, idiotic statements like: 'Here's the bathroom.' Well, no sh1t, sherlock. And yesterday's classic was "Yes, it looks small, but if you take the shed out you've actually got quite a good sized garden here." The sooner Tesco or whoever come up with an internet portal for buying & selling properties to make these useless parasites redundant, the better.