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Truly Incredible Price Achieved

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I was talking to a friend last night who told me about a neighbour of his who has just taken an offer on his 3 bed semi. It's in a Outer London suburb a couple of miles from the end of the M3. The house in question is identical to my friend's and is as follows.

Traditional 1930s 3 bed semi - completely unextended. So ... small hall, 12' x 12' lounge, kitchen/dining where the kitchen area is about 8' x 9' and the dining area is about 12' x 8'. Downstairs loo squeezed into what would originally have been the cupboard under the stairs. Upstairs two 12' x 11' bedrooms, one 9' x 7' bedroom and one 6'6" x 6'6" bathroom. Bathroom and kitchen have been nicely refitted by all accounts and the ground floor has the ubiquitous stripped floorboards and a nice fireplace in the lounge etc.

BUT, this is a small house. It's typical of tens of thousands of 3 bed semis found throughout Ealing, Hounslow, Isleworth etc. The road is a bit variable - the houses are all similar but some are close together (no garage at the back) - others have a gap between just big enough for a car to get down. Some of the other houses have been extended in all directions, out the back, porch on the front, into the loft etc. But this one hasn't. This one has the gap between the houses just big enough to get a car down and has a garage in the garden about 15' from the house. The gardens, of these houses, are not the traditional 100' - in fact they are small - the backs of the garages are the ends of the garden. Parking in the area is a nightmare. The houses were built when owning cars was unusual and now that most houses have got 2 cars or more, the whole street is chocked with cars parked two wheels up on every bit of pavement space available.

Yet, someone has seen fit to offer the vendor 50k short of HALF A MILLION pounds.

I'm really struggling to understand this London madness - if it were Kensington or Chelsea you'd kind of understand. But it's an Outer London suburb which I have visited a number of times and it is by no means on the 'highly desirable' list. It's okay, but there's plenty of undesirable looking herberts about.

I know people will say 'Ahh, but he hasn't exchanged yet'. Which is true but, even so, someone thinks it's worth nearly half a million quid.

I live two junctions down the M3 - about half an hour away by car. 450k here buys you a decent sized 4 bed detached with double detached garage, utility room, reasonable garden, three bogs (family bathroom, en-suite, downstairs loo) etc.. But in Outer London, just half an hour away, it buys you a small 3 bed semi with a shared drive, one off street parking space (which takes up the whole front garden) and a small garden. And, in this case with almost no room to extend. If you extended out the back you'd block your access to your garage. You might just fit a small conservatory on the back of the dining area.

I've been preaching the house price crash mantra to my friend for some years now - and although he doesn't really argue with me - I know he thinks I'm a nutter. In 2008 it began to look as if I was correct in my (as far as he was concerned) gloomy predictions. When he was telling me yesterday about his neighbour I just has to keep my remarks to 'wow, the market there must be unaffected by everything that's going on'.

I'm walking around this morning muttering to myself 450 grand, 450 GRAND! for a poxy 3 bed semi - in an area not many miles from where I grew up. There were various house price booms in the 1970s - those houses used to fetch about 12k when I was say 20 and 25k by the time I was 30. My brother bought a similar property in the same area in the early 1980s for 27k. I'd say that house has increased in price by a factor of 45 since 1970 and by a factor of 17 since 1980.

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Some people do not observe what is happening around them, nor do they read, see or hear the news.

Most people do, however, see, read or hear the news and observe what is happening around them and aren't so stupid.

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Some people do not observe what is happening around them, nor do they read, see or hear the news.

Most people do, however, see, read or hear the news and observe what is happening around them and aren't so stupid.

Yes, but it only takes one for everyone in that area to think 'Great, my little semi is worth 450k!'

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Yes it is quite amazing . My dad lives at the other end of London in the east suburbs. I would say thoughtout the last few years what little price reduction there was on his house has now been returned. He lives in a small three bed semi and I think that is worth about 350k.

Maybe it is numbers , you say there are hundreds of thousands of these types of houses but how many people are there. In all these areas there is a strong asian presence . They are people who club together live together and buy houses with little or no mortgage , they buy one a few famillys live in it together pay it off and with out selling it move on to the next one. They reduce the bills by living in extended familys and pay down mortgages quickly, they do not live one family on its own paying 25 years of interest. They have the money and will keep the houses no matter what happens in the short term .

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Offering 450k for a house - and getting accepted - is nothing. It all depends on whether they go through with it.

Lots of times I have offered the asking price for a house, then once I have thought about it, withdrawn my offer. Of course, that leaves the poor fools who are selling thinking they can get what they want....

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Offering 450k for a house - and getting accepted - is nothing. It all depends on whether they go through with it.

Lots of times I have offered the asking price for a house, then once I have thought about it, withdrawn my offer. Of course, that leaves the poor fools who are selling thinking they can get what they want....

Lots of times people offer the asking price for house, then buy it.

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True, but most home sales don't go through.

I suspect the buyer will want to get a fair % knocked off. I regularly offer the asking price on a house, for no other reason to get the house off the market. Then when the survey comes, get the price right down.

Sorry to burst your bubble, but most houses aren't actually sold for the full asking price.

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Offering 450k for a house - and getting accepted - is nothing. It all depends on whether they go through with it.

Lots of times I have offered the asking price for a house, then once I have thought about it, withdrawn my offer. Of course, that leaves the poor fools who are selling thinking they can get what they want....

Why would you make lots of offers without thinking about it? You're just wasting people's time.

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Why would you make lots of offers without thinking about it? You're just wasting people's time.

This may come as a surprise, but lots of people put in offers in the heat of the moment - only to withdraw later.

So, did the buyer of your shack pull out then?

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True, but most home sales don't go through.

I suspect the buyer will want to get a fair % knocked off. I regularly offer the asking price on a house, for no other reason to get the house off the market. Then when the survey comes, get the price right down.

Sorry to burst your bubble, but most houses aren't actually sold for the full asking price.

80% of offers do go through .

Do you buy these houses that you get the surveys done on ? , or is it a hobby of yours instead of spending money in the pub or the bookies , you spend it on house surveys ?.

Sorry to burst your bubble but it is an urban mith that most buyers drop the price agreed just before exchange of contract, most houses are not sold for the full asking price but most sell for the full agreed price on offer.

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Sadly I do believe this will sell. As I mentioned on the Balham thread in regional prices, Zone 3 London appears to be achieving over peak 2007 again. I'm thinking this is due to trickle out after foreign buyers sent the market in Zone 1 and prime zone 2 crazy. London really does seem to be de-coupling from the rest of the country where I do believe it is getting harder and harder to sell and prices are dropping. I have an alert set up on houseprices.co.uk to send me sold prices in particular postcodes and this month I had more solds come up than have ever done in the past 2 years. Not many grant you but a solid block.

Is the house in the catchment area of a good state school? This seems to make a difference.

Just seen a very run down version of what you describe in Hammersmith listed at auction for just short of half a million. I'll keep an eye but if their last auction is anything to go by, most properties in that area went for between 1.2 and 1.45 x guide.

I'm not sure what an interest rate rise will do but this is probably what's needed in London. I see couples who both had a starter flat in London bought pre 2006 that easily "made" 100k. They withdraw this equity from the flats, keeping them on to rent out (so no need for someone at the bottom of the chain), put down a 200k deposit on a 450k house for instance, fix for 3 years at 3.5% - mortgage payment = about £1300, quite do-able if combined income is around 60k (one full time salary 45 k ish, one part time 15k ish). People don't seem to worry too much about what will happen when they come off their fix into a high interest rate period.

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80% of offers do go through .

Do you buy these houses that you get the surveys done on ? , or is it a hobby of yours instead of spending money in the pub or the bookies , you spend it on house surveys ?.

Sorry to burst your bubble but it is an urban mith that most buyers drop the price agreed just before exchange of contract, most houses are not sold for the full asking price but most sell for the full agreed price on offer.

How old are your figures?

And sorry to burst yours, but I have managed to get the house price reduced on the basis of the survey a number of times. If people don't bother to try, more fool them.

In any event, there isn't much being sold at the moment.

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Yes, I know about the price of building land - but imagine what they could have done with the 1/2 million in terms of buying a bit of land and building their own house.

That aside, these buyers, I suspect are going to find out exactly how expensive a mistake they are making over the next few years. Regrets? It won't be just a few.

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How old are your figures?

And sorry to burst yours, but I have managed to get the house price reduced on the basis of the survey a number of times. If people don't bother to try, more fool them.

In any event, there isn't much being sold at the moment.

Not sure how old the figures are , but they are more accurate than your " most" which is not a figure in it self but a figure of speach.

You say you have got the price reduced on the basis of the survey a number of times however you do not buy the house so you never really wanted the house.You were just playing a game. Out of the 80% of sales that I quoted the buyers wanted the houses so they did not play games with the prices like you did, you are an entirly different entity to someone who offers on a house because they want and need it.

To burst your bubble again ,

My dad has never moved since he and my mum bought their house over 50 years ago.Recently he enquired about selling his house with a local agent , and quoted that he was worried about the urban mith of someone dropping the agreed price just before exchange of contract's. The agent said sales do fall through for various reasons , however in 15 years of trading only once did a buyer try to drop the price just after the survey and just before exchange . He told the buyer no way and the following week the buyer bought the house at the agreed price. That put paid to my dads worries of the urban myth that you are quoting.

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Sadly I do believe this will sell. As I mentioned on the Balham thread in regional prices, Zone 3 London appears to be achieving over peak 2007 again. I'm thinking this is due to trickle out after foreign buyers sent the market in Zone 1 and prime zone 2 crazy. London really does seem to be de-coupling from the rest of the country where I do believe it is getting harder and harder to sell and prices are dropping. I have an alert set up on houseprices.co.uk to send me sold prices in particular postcodes and this month I had more solds come up than have ever done in the past 2 years. Not many grant you but a solid block.

Is the house in the catchment area of a good state school? This seems to make a difference.

Just seen a very run down version of what you describe in Hammersmith listed at auction for just short of half a million. I'll keep an eye but if their last auction is anything to go by, most properties in that area went for between 1.2 and 1.45 x guide.

I'm not sure what an interest rate rise will do but this is probably what's needed in London. I see couples who both had a starter flat in London bought pre 2006 that easily "made" 100k. They withdraw this equity from the flats, keeping them on to rent out (so no need for someone at the bottom of the chain), put down a 200k deposit on a 450k house for instance, fix for 3 years at 3.5% - mortgage payment = about £1300, quite do-able if combined income is around 60k (one full time salary 45 k ish, one part time 15k ish). People don't seem to worry too much about what will happen when they come off their fix into a high interest rate period.

I quite agree London and the burbs seem to have little connection to the rest of the country. My close neighbour is selling and has recently cut 25k + from his asking price after a month on the market to stimulate some interest. BTW he's had plenty of viewings but no offers, there are very few real buyers around.

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Sadly I do believe this will sell. As I mentioned on the Balham thread in regional prices, Zone 3 London appears to be achieving over peak 2007 again. I'm thinking this is due to trickle out after foreign buyers sent the market in Zone 1 and prime zone 2 crazy. London really does seem to be de-coupling from the rest of the country where I do believe it is getting harder and harder to sell and prices are dropping. I have an alert set up on houseprices.co.uk to send me sold prices in particular postcodes and this month I had more solds come up than have ever done in the past 2 years. Not many grant you but a solid block.

Is the house in the catchment area of a good state school? This seems to make a difference.

Just seen a very run down version of what you describe in Hammersmith listed at auction for just short of half a million. I'll keep an eye but if their last auction is anything to go by, most properties in that area went for between 1.2 and 1.45 x guide.

I'm not sure what an interest rate rise will do but this is probably what's needed in London. I see couples who both had a starter flat in London bought pre 2006 that easily "made" 100k. They withdraw this equity from the flats, keeping them on to rent out (so no need for someone at the bottom of the chain), put down a 200k deposit on a 450k house for instance, fix for 3 years at 3.5% - mortgage payment = about £1300, quite do-able if combined income is around 60k (one full time salary 45 k ish, one part time 15k ish). People don't seem to worry too much about what will happen when they come off their fix into a high interest rate period.

Yes, my friend tells me that the bloke who is selling the house (who he is quite matey with) earns about 8k a month as a contractor in IT. He is moving up to something for 600k. He has a lot of equity in the house and the extra mortgage is, for him, peanuts.

People such as you describe (two starter flats, rent out etc) - the sort of people who live in London and read the Telegraph property supplement - seem to inhabit some sort of parallel universe. But their's is every bit as real as ours.

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I'm not sure what an interest rate rise will do but this is probably what's needed in London. I see couples who both had a starter flat in London bought pre 2006 that easily "made" 100k. They withdraw this equity from the flats, keeping them on to rent out (so no need for someone at the bottom of the chain), put down a 200k deposit on a 450k house for instance, fix for 3 years at 3.5% - mortgage payment = about £1300, quite do-able if combined income is around 60k (one full time salary 45 k ish, one part time 15k ish). People don't seem to worry too much about what will happen when they come off their fix into a high interest rate period.

Anecdotally I've seen a few arrangements like that myself. People are still setting themselves up to be on the wrong side of the equation when the market turns in earnest.

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To burst your bubble again ,

My dad has never moved since he and my mum bought their house over 50 years ago.Recently he enquired about selling his house with a local agent , and quoted that he was worried about the urban mith of someone dropping the agreed price just before exchange of contract's. The agent said sales do fall through for various reasons , however in 15 years of trading only once did a buyer try to drop the price just after the survey and just before exchange . He told the buyer no way and the following week the buyer bought the house at the agreed price. That put paid to my dads worries of the urban myth that you are quoting.

And of course, we all believe what estate agents tell us, don't we?

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And of course, we all believe what estate agents tell us, don't we?

I believe part of what people tell me and take a rain check on the rest. Whether they be estate agent's or not.

To conclude I would put more faith in an estate agent's view of how the market operates than I would from someone who wastes his and other peoples time and money putting in offers on houses that he has no intention of buying. I really have never heard of such a weird hobby in my life, but then again should i actually believe what you are telling me as it sounds extremley strange , im surprised that you would admit to it.

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I believe part of what people tell me and take a rain check on the rest. Whether they be estate agent's or not.

To conclude I would put more faith in an estate agent's view of how the market operates than I would from someone who wastes his and other peoples time and money putting in offers on houses that he has no intention of buying. I really have never heard of such a weird hobby in my life, but then again should i actually believe what you are telling me as it sounds extremley strange , im surprised that you would admit to it.

If you are foolish enough to put your faith in estate agents, then you deserve all you are going to get. And by the way, over the past few years I have bought and sold a number of houses, but of course people will make assumptions about others.......

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If you are foolish enough to put your faith in estate agents, then you deserve all you are going to get. And by the way, over the past few years I have bought and sold a number of houses, but of course people will make assumptions about others.......

I said i believe part of what people tell me not all , that's very different form putting faith in estate agent's. However i would have more faith in them than you .

Deserve all im going to get ? what am i after ?

Yes we do all make assumptions , we make them based on what we see , what we hear, what we know , what we understand , it's called human nature.

I would assume that someone who stated they put in offers on houses with no intention of buying them was a time waster. Funny how when that was pointed out to that person they suddenly change tact and say that they have bought and sold a few houses in the past few years. So my assumption of you would change again , which brings me round to what i said earlier I beleive some of what people tell me and take a rain check on the rest, in your case i would not beleive anything as what you say and put accross changes very quickly.

By the way from your own point of view when you bought the houses were you in the least group the group who bought funny that.

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and to think I thought a uni mate was crazy for paying 240k for a flat in zone 2 in 2004ish, to all intensive purposes it is a house as it has a front door and rooms downstairs and up... Must be worth 700k+ now...

Edited by AteMoose

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I'm walking around this morning muttering to myself 450 grand, 450 GRAND! for a poxy 3 bed semi - in an area not many miles from where I grew up. There were various house price booms in the 1970s - those houses used to fetch about 12k when I was say 20 and 25k by the time I was 30. My brother bought a similar property in the same area in the early 1980s for 27k. I'd say that house has increased in price by a factor of 45 since 1970 and by a factor of 17 since 1980.

It is crazy, but prices have remained so high for so long that people just get used to talking about massive sums of money for very ordinary houses.

I live in an area similar to the one that you describe. Even as a relatively dedicated 'HPCer', I was actually thinking the other day that I would be prepared to buy one of these 3 bed semis when/if the ones in the road that I want hit £400k. Considering that they are north of £600k at the moment, that is quite some crash that is going to be required before I buy!

That got me thinking - if I am considering that type of price reasonable, what is the majority of the public who don't come onto this site regularly thinking?

The houses that I am now looking at peaked close to £700k (actual sold prices). Even if we get a 50% drop in prices, that will still leave them at £350k, meaning that someone would need a £100k salary and a good deposit to buy one reasonably. I am not sure that was the type of target market for these modest houses in a zone 6 suburb when they were built 80 years ago or even when they were changing hands 25 years ago!

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and to think I thought a uni mate was crazy for paying 240k for a flat in zone 2 in 2004ish, to all intensive purposes it is a house as it has a front door and rooms downstairs and up... Must be worth 700k+ now...

so, what changed between 2004 and now.

Are Britains earning more?

Is there more wealth?

or is this the face of Mr Ponzi Grinning back at you?

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The houses that I am now looking at peaked close to £700k (actual sold prices). Even if we get a 50% drop in prices, that will still leave them at £350k, meaning that someone would need a £100k salary and a good deposit to buy one reasonably. I am not sure that was the type of target market for these modest houses in a zone 6 suburb when they were built 80 years ago or even when they were changing hands 25 years ago!

The target market for the suburbs was the over growed manual workers who were living in the cities.. They were sold for between £450-£1200 , back then , you put a £5 deposit down on resevation and then made up the other £20 needed by the time the house was built.

Read recently that you needed an income of about £3 a week to buy a house, many got in trouble with the payments and there was what we describe today as a sub prime crises . After that the lenders tightned up lending .

My parents bought one for £3,750 in 1961 , and were told they were mad and should hang on as prices would soon drop. 25 years ago it was valued at £70k , a few years later it went to £130,000 dropping back to about £80k in the last crash. This time around it peaked at £350,000 dropped by about 5% and is now back to £350,000.

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  • 152 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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