Caught Up In The Spring Bounce

[shedfish]

Tempted by reductions, and nervous about the safety of my ever expanding deposit, i've been viewing and making low offers this spring, and adding to the 'increased activity' as reported by EAs.

the lower end of the market has been my focus - i don't have huge aspirations for a McMansion, or a detached with a pool... 120k buys a half decent house in parts of Staffs, and i've been trying to get one down to 100k or less, with no success.

there has been mention of animal spirits elsewhere... and there seemed to be a lot of this about, briefly - i have nothing to compare it to, as this is the first time i've actively participated in a spring 'house hunt'; but i did get swept along to a certain extent.

during this time, supply has been constricted, and the typical attitude of EAs and vendors has been of the spring 2007 vintage, if you catch my drift..

the last couple of weeks though, things have changed.

1) i've run out of steam and interest

2) inventory is increasing again, markedly so - and the new stock is coming available at lower prices, on a like-for-like basis

3) chains are collapsing, and previously solds are coming back on, often at reduced prices

coupling this with the recent falls reported in most indices (which i believe showed the Nationwide stats up as an anomaly, rather than a sea change), and the surprise suspension of QE; and my urgency to 'snap up a bargain' has disappeared.

my work has picked up a little, so i think it's time to hunker down and save for another 6 months at least, then see where the dust has settled.

(edit for spelling)

Edited July 10, 2009 by ɥsıɟpǝɥs

[dr ray]

We thought we would have no trouble selling our late M-I-Ls house when we put it on the market in April. We were even expecting to sell over asking price as several people seemed interested. We had daily viewings for a couple of weeks and then it just stopped.

Nothing at all in June.

People aren't even asking for a discount or making silly offers.

[Dr Renter]

We thought we would have no trouble selling our late M-I-Ls house when we put it on the market in April. We were even expecting to sell over asking price as several people seemed interested. We had daily viewings for a couple of weeks and then it just stopped.

Nothing at all in June.

People aren't even asking for a discount or making silly offers.

August to March is going to be heaven for the bears. It's a shame the bulls got trolled as they are in for a beating.

[cashinmattress]

so i think it's time to hunker down and save for another 6 months at least, then see where the dust has settled.

6 months! Try six years more like.

[Guest KingCharles1st]

Nobody's even chasing the market down

It's OVER- bring on the reset

SHedbabes- I reckon six months could see you in a great position

[Mrs Bear]

Tempted by reductions, and nervous about the safety of my ever expanding deposit, i've been viewing and making low offers this spring, and adding to the 'increased activity' as reported by EAs.

the lower end of the market has been my focus - i don't have huge aspirations for a McMansion, or a detached with a pool... 120k buys a half decent house in parts of Staffs, and i've been trying to get one down to 100k or less, with no success.

there has been mention of animal spirits elsewhere... and there seemed to be a lot of this about, briefly - i have nothing to compare it to, as this is the first time i've actively participated in a spring 'house hunt'; but i did get swept along to a certain extent.

during this time, supply has been constricted, and the typical attitude of EAs and vendors has been of the spring 2007 vintage, if you catch my drift..

the last couple of weeks though, things have changed.

1) i've run out of steam and interest

2) inventory is increasing again, markedly so - and the new stock is coming available at lower prices, on a like-for-like basis

3) chains are collapsing, and previously solds are coming back on, often at reduced prices

coupling this with the recent falls reported in most indices (which i believe showed the Nationwide stats up as an anomaly, rather than a sea change), and the surprise suspension of QE; and my urgency to 'snap up a bargain' has disappeared.

my work has picked up a little, so i think it's time to hunker down and save for another 6 months at least, then see where the dust has settled.

(edit for spelling)

I wish I could say the same for a small Dorset area I'm watching. Over the past few weeks stacks of longstanding stuff has gone U/O, inc. some properties that have been languishing since summer 07, and also inc. one run-down place I had my beady eye on. Was dithering for ages over whether to make a seriously cheeky offer or wait a few more months, and now some other b*gger's pipped me. Since it was such a forlorn, unloved dump and doesn't look much from the outside either, I'd kidded myself nobody else would want it.

Only one prop. has gone U/O and back to available, though I live in hope.

And virtually nothing new is coming on to this particular (relatively small) market.

[dr ray]

I wish I could say the same for a small Dorset area I'm watching. Over the past few weeks stacks of longstanding stuff has gone U/O, inc. some properties that have been languishing since summer 07, and also inc. one run-down place I had my beady eye on. Was dithering for ages over whether to make a seriously cheeky offer or wait a few more months, and now some other b*gger's pipped me. Since it was such a forlorn, unloved dump and doesn't look much from the outside either, I'd kidded myself nobody else would want it.

Only one prop. has gone U/O and back to available, though I live in hope.

And virtually nothing new is coming on to this particular (relatively small) market.

When the buyer goes bust doing the place up and the house is repossessed you'll be able to buy it for less and have less work to do on it.

Perhaps you should befriend the buyer and offer your opinions on decor and how it should be modernised.

[Guest Daddy Bear]

I wish I could say the same for a small Dorset area I'm watching. Over the past few weeks stacks of longstanding stuff has gone U/O, inc. some properties that have been languishing since summer 07, and also inc. one run-down place I had my beady eye on. Was dithering for ages over whether to make a seriously cheeky offer or wait a few more months, and now some other b*gger's pipped me. Since it was such a forlorn, unloved dump and doesn't look much from the outside either, I'd kidded myself nobody else would want it.

Only one prop. has gone U/O and back to available, though I live in hope.

And virtually nothing new is coming on to this particular (relatively small) market.

Exactly the same story in desirable towns and locations up and down the country.

I've said it before and I will say it again.....

2 bed new build flats (in places like slough, reading, colchester, Leeds, manchester, west midlands etc...) will fall 60 - 70% or so until they provide a decent rental yield.... other crappy houses in poor areas will experience the same.

Good family houses in sought after towns near good schools that tick all the boxes will fall 30% or so max.

So overall the Halliwide indices will show an average fall of 50% or so ...troughing in about 12 months.

Make your choices.

[silver panda]

A fall in the Nationwide index, which is likely after two months of rises, would have a significant negative effect on sentiment.

[geoffk]

Exactly the same story in desirable towns and locations up and down the country.

I've said it before and I will say it again.....

2 bed new build flats (in places like slough, reading, colchester, Leeds, manchester, west midlands etc...) will fall 60 - 70% or so until they provide a decent rental yield.... other crappy houses in poor areas will experience the same.

Good family houses in sought after towns near good schools that tick all the boxes will fall 30% or so max.

So overall the Halliwide indices will show an average fall of 50% or so ...troughing in about 12 months.

Make your choices.

absoulute rubbish.... average selling time for my area 276 days.....7 houses sold in may out of 1248 for sale....spring bounce not round here..price cuts as we speak..

[pie-eater]

absoulute rubbish.... average selling time for my area 276 days.....7 houses sold in may out of 1248 for sale....spring bounce not round here..price cuts as we speak..

Is it 'desirable' where you live, to coin EA drivel?

Where I live is meant to be desirable and stuff has shifted of late; but only at lowered prices.

[TheCountOfNowhere]

Exactly the same story in desirable towns and locations up and down the country.

Good family houses in sought after towns near good schools that tick all the boxes will fall 30% or so max.

well....Buy a decent house in an area with worst school stats, then with the cash you save...invest it then send you child to private school, then you have a choice and you're not left holding an over-priced piece of s*** when the school's rating fall.

If you're that worried about you childs education you'd come home from work and start teaching them yourself. How many do that, how many are that bothered ? The whole "better schools" thing is a total red herring. I know 3 people with great educations that earn less than £15K a year, two of them are on "medication". I know 5 peoples stuck in NE having bought in a good school catchment area who are now seeing their school being downgraded due tothe governments great idea of 10% social housing on new estates. Great, in debt and stupid kids !!!!!

Your middle class...lawyer...banker...acountant world is f**ked in my opinion, not everyone can be a middle man, we need some do'ers in this messed up country. Goto a crap school and become a workman, you might not earn mega bugs....but you'll have a job

Ive said it before...People really are just stupid and believe what they're told.

[geoffk]

yes.. i think so without giving out all its a ch postcode..chester cheshire average 4 bed gone from 270/90 to 210/20 but the sals are non existance.. i have just seen one its been on for 18 mths and going to sealed bids form 275 to bids around 190k but the market is dead..we have not had a spring bounce but i think our crash started 2006 because few first time buyers have been able to afford the area..

Edited July 10, 2009 by geoffk

[Dino]

I wish I could say the same for a small Dorset area I'm watching. Over the past few weeks stacks of longstanding stuff has gone U/O, inc. some properties that have been languishing since summer 07, and also inc. one run-down place I had my beady eye on. Was dithering for ages over whether to make a seriously cheeky offer or wait a few more months, and now some other b*gger's pipped me. Since it was such a forlorn, unloved dump and doesn't look much from the outside either, I'd kidded myself nobody else would want it.

Only one prop. has gone U/O and back to available, though I live in hope.

And virtually nothing new is coming on to this particular (relatively small) market.

Same here. Old stock selling, no new stock coming onto the market.

Unless 000's of desperate sellers suddenly appear, the falls have finished to all intents and purposes.

[johnny5thumbs]

How will the Global Economy play out 2005 onwards?

1. Global Housing Market Bubble Bursts

2. Global Bank Lending Implodes

3. Global Economy Begins to Contract

4. Global Banks begin to Fail

5. Global Unemployment Soars

6. Global Banks are Nationalised

7. Global Interest Rates are Lowered Dramatically to 0%

8. Global Quantitative Easing will be carried out on a Massive Scale

9. Global (Inflationary) Default on Debt - (Bond Market Collapse)

10. Global Dash For Assets

11. Global Hyperinflation

12. Global New Currencies introduced

13. Global Political Unrest & Change

Stage 1-2 (Aug 2007), Stage 3-5 (2007-2008), Stage 6-7 (Late 2008-09), Stage 7 (Jan 2009), Stage 8 (Mar 2009)...

Not much time left (when will the bond market collapse?) - PROTECT YOURSELVES

Just wondering, DB, when no. 9 of your sig. is likely to come due. Maybe it would help the HPC situation to speed up a little and save a little nail-biting for some of us.

Care to hazard any guesses as to likely due date?

[pie-eater]

yes.. i think so without giving out all its a ch postcode..chester cheshire average 4 bed gone from 270/90 to 210/20 but the sals are non existance.. i have just seen one its been on for 18 mths and going to sealed bids form 275 to bids around 190k but the market is dead..we have not had a spring bounce but i think our crash started 2006 because few first time buyers have been able to afford the area..

I STR'd to rent in my area, SM5 - Surrey London borders.

Houses are selling but slowly, and ~ 20% ubder 07 prices.

My problem is that her indoors has now started seeing this and becoming annoyingly scared that we're missing the boat.

A house just sold over the road, but luckily, it went for £100k less than next door sold for at the peak - 25% under that price.

Edited July 10, 2009 by pie-eater

[Guest An Bearin Bui]

Exactly the same story in desirable towns and locations up and down the country.

I've said it before and I will say it again.....

2 bed new build flats (in places like slough, reading, colchester, Leeds, manchester, west midlands etc...) will fall 60 - 70% or so until they provide a decent rental yield.... other crappy houses in poor areas will experience the same.

Good family houses in sought after towns near good schools that tick all the boxes will fall 30% or so max.

Sounds good to me - 3-bed places in good parts of Edinburgh (either flats, upper half of a house or houses) were going for about 350-375k at the peak so with 30% that gets them well into my price range. I wouldn't have expected much more than that to be honest. Already prices are down about 11% YOY, possibly 15% for certain types of property, so only another 15% to go! Hurray!

[Harry Monk]

Same here. Old stock selling, no new stock coming onto the market.

Unless 000's of desperate sellers suddenly appear, the falls have finished to all intents and purposes.

As you say, no new stock is coming onto the market.

Does that strike you as a situation which is indicative of recovery? No new stock is coming onto the market because nobody can afford to trade up, and hundreds of thousands of people need to, as they always do.

When the market returns to normality, houses will be trading at 40-45% below peak.

[Guest Daddy Bear]

Exactly the same story in desirable towns and locations up and down the country.

I've said it before and I will say it again.....

2 bed new build flats (in places like slough, reading, colchester, Leeds, manchester, west midlands etc...) will fall 60 - 70% or so until they provide a decent rental yield.... other crappy houses in poor areas will experience the same.

Good family houses in sought after towns near good schools that tick all the boxes will fall 30% or so max.

So overall the Halliwide indices will show an average fall of 50% or so ...troughing in about 12 months.

Make your choices.

absoulute rubbish.... average selling time for my area 276 days.....7 houses sold in may out of 1248 for sale....spring bounce not round here..price cuts as we speak..

Well I really do think crappy 2 bed flats and poorly located housing will fall 60-70%. You may think this is absolute rubbish - we will agree to differ.

I predicted a long time ago that the average price of housing in UK will fall according the HalliWide indices by about 50% overall - so it figures that good housing will fall by about 30%.

Not really absolute rubbish.

In answer to when will bond market collapse - later this year. I predicted early april a while ago - they managed to hold back the dam. But it is inevitable. As sure as night follows day.

Will it speed up a HPC? - in real terms very much so - in nominal terms far from it.

Hence why I bought 2 months ago (using a 10 year fix) at 32% below peak after str-ing 2 years ago.

As I say make your choices.

DB

[WATP]

My brother is a doctor in Bucks who was planning to upgrade to a £1m house, down 20%, but the sale of his existing house just fallen through.

Other brother is a tax inspector who is also looking to move to bigger house in Brighton but cant sell his own house.

My sister is a teacher in Bradford who wants to move to better school catchment but is also having trouble selling.

I work in the private sector sold in 2007, sitting on my money and renting at ever lower prices.

I keep telling my family that the old game of a secure public sector job and big mortgages is coming to an end but they don't listen. Who is the mug, my family or me?

Edited July 11, 2009 by WATP

[Caveat Mortgagor]

I would like to add to the good stock/good areas/good schools v crappy areas/new build debate.

There is a distinction in the falls of these different types of properties. But a lot of bears misunderstand how the market works, and not just on this issue. I am amazed at the number of smart people on these boards that cant follow a scent.

Whilst I am at it, the bulls are crap too. I could do a much better job of being a bull than Rinoa, Hamish et al.

Anyway, back on topic now.............. The distinction in this case is the speed and timing of falls. The crappy areas will fall sooner, the nicer properties will fall by a similar amount, but they will take longer to reach the bottom of their market. When the crappy areas have bottomed, the nicer pnces will still fall slowly for some significant time. And when the crappy areas atart climbing again ( along time yet) the nice areas may still be falling or even entering a period of stability.

The price differentials between these types of properties will be restored - eventually.

This is why you can already see crappy areas falling but believe that nicer ones are holding out. They will fall, but because of the desireability of these types of properties, they will be the last to feel the effects.

But feel it they most certainly will.

Edited July 11, 2009 by Nick Dastardly

[Steppenpig]

In sw12, there are about 15 "under offer" and "STC" on rightmove, compared to 1 or 2 earliaer in the year (of course, may collapse, but at the moment are part of the spring bounce). Prices are down at least 20% from peak.

[dr ray]

I would like to add to the good stock/good areas/good schools v crappy areas/new build debate.

There is a distinction in the falls of these different types of properties. But a lot of bears misunderstand how the market works, and not just on this issue. I am amazed at the number of smart people on these boards that cant follow a scent.

Whilst I am at it, the bulls are crap too. I could do a much better job of being a bull than Rinoa, Hamish et al.

Anyway, back on topic now.............. The distinction in this case is the speed and timing of falls. The crappy areas will fall sooner, the nicer properties will fall by a similar amount, but they will take longer to reach the bottom of their market. When the crappy areas have bottomed, the nicer pnces will still fall slowly for some significant time. And when the crappy areas atart climbing again ( along time yet) the nice areas may still be falling or even entering a period of stability.

The price differentials between these types of properties will be restored - eventually.

This is why you can already see crappy areas falling but believe that nicer ones are holding out. They will fall, but because of the desireability of these types of properties, they will be the last to feel the effects.

But feel it they most certainly will.

Its not as simple as this. I watched what happened in London during the 1980s boom and subsequent collapse.

Property in Hampstread, South Ken and Mayfair has always beem expensive but during the boom adjacent crappy areas such as Kilburn suddenly became West Hampstead and the rougher parts of North Kensington such as Ladbroke Grove became (Just) Kensington and prices rose much more steeply than the posher areas, or indeed in the unashamedly crappy areas such as Harlesden or East Acton. Towards the end of the boom the penumbra spead wider so that Harlesden became almost West Hampstead etc and the price here started to catch up.

As the crash took hold Harlesden went back to being valued correctly for a gun-ridden, gangland murder hot spot and prices fell hard. West Hampstead dropped next (being so close to the murder hotspot of the UK) but the nicer parts of Hampstead never dropped as much.

What I am getting at is that the "niceness" of an area and the price it commands is not fixed and some areas will be valued with the posh areas on the way up and the crap areas on the way down and amplify any national house price movement.

[dr ray]

So it comes down to location, location location, as always.

Generally yes. The number of truly prime locations (such as on a hilltop or on the coast) is limited and properties don't come on the market very often so are not so HPC sensitive. Properties in Belgravia are perhaps subject to different pricing pressures (such as £/$ exchange rate and Oil Price) to normal residential property as these multimillion £ properties are sold in the international market.

Provincial city centre newbuilds are two-a-penny and behave like a commodity in surplus (like the reduced-to-clear section in the supermarket)

[Caveat Mortgagor]

Generally yes. The number of truly prime locations (such as on a hilltop or on the coast) is limited and properties don't come on the market very often so are not so HPC sensitive. Properties in Belgravia are perhaps subject to different pricing pressures (such as £/$ exchange rate and Oil Price) to normal residential property as these multimillion £ properties are sold in the international market.

Provincial city centre newbuilds are two-a-penny and behave like a commodity in surplus (like the reduced-to-clear section in the supermarket)

Doc,

A lot of people think they live in areas that will never fall. I suggest a lot of these people could be in the same danger as FTBs buying at peak in 2007. They are in areas that will fall later than the less attractive areas / houses / catchment areas. But they will fall.

Lets talk about the rule rather than trying to identify exceptions and believing that the rule doesnt exist.

There has been one hell of a party. There will be a huge hangover. If you were drinking the punch, you will feel like sh!t!

For 95%+ of areas where people think they are immune, it is merely the case that they want to believe it is true, just like sheeple in 2007 wanted to believe property would anly ever go up.

The crash for nicer areas is coming. Just a matter of timing.