Jan 2011: 64% More Price Reductions Than Jan 2010

[Tired of Waiting]

I think this report from Home.co.uk deserves its own thread. Comparing Jan 2011 with Jan 2010, it shows a clear increase in the supply of new properties in the market, and in the frequency of asking prices reductions:

________________________________________________________________________________________

"Sellers Slash and Prices Tumble"

Summary

(...)

The number of properties reduced in price has leaped to 65,692 for the month of January, a massive 64% more than in January 2010.

(...)

Total properties new to market in Jan 2011 was 14% higher than in Jan 2010 [/b]

________________________________________________________________________________________

Full report here: http://www.home.co.uk/asking_price_index/HAPIndex_FEB11.pdf

Supply in each postcode area can be viewed here: http://www.rightmove.co.uk/house-prices-in-my-area/marketTrendsTotalAvailableListingsAndNew.html?searchLocation=nw1+8yd

.

Edited February 19, 2011 by Tired of Waiting

[Pent Up]

There was actually a thread on this on Monday.

But with a headline like that theres no harm in discussing it again

This is the first report to cite increasing supply as a downward pressure.

[Tired of Waiting]

There was actually a thread on this on Monday.

But with a headline like that theres no harm in discussing it again

This is the first report to cite increasing supply as a downward pressure.

Oh that other thread had a very different angle...

[Pent Up]

Oh that other thread had a very different angle...

I suppose RB gets away with posting three threads on the same subject so why not

[koala_bear]

There was actually a thread on this on Monday.

But with a headline like that theres no harm in discussing it again

This is the first report to cite increasing supply as a downward pressure.

I would regard increasing supply as a very doubtful downward pressure as the majority don't seem "priced to sell" if there are more coming on to the market who will accept a market derived price rather than what they think its worth increased supply might well become a downward pressure. I wait to see if 2011 as brought more realism.

[Pent Up]

I would regard increasing supply as a very doubtful downward pressure as the majority don't seem "priced to sell" if there are more coming on to the market who will accept a market derived price rather than what they think its worth increased supply might well become a downward pressure. I wait to see if 2011 as brought more realism.

It will because buyers will be spoilt for choice and will choose the lower priced properties. Also they can get away with making lower offers at if rejected theres plenty more to choose from. Sellers need to compete against each other to be best quality and price to sell.

[Van]

Prices are definitely softening up, and anything that is not in A-grade condition is getting a pummelling.

Look at this place in Balham - put on the market in Nov at 290k, cut to £280k last month, and now slashed to 250k today. That's 14% off within a matter of months. Now over-optimistic sellers like this might be few and far between, but my Rightmove searching is showing absolutely truckloads of similar price cuts on properties all over London. It'll be lucky to go for £230k imo. That's a massive difference between what they originally thought they could get and the reality of the market.

http://www.rightmove.co.uk/property-for-sale/property-17509266.html?premiumA=true

17 February 2011

* Price changed: Guide Price £259,950 £249,000 [Found by n/a]

03 February 2011

* Price changed: £279,950 Guide Price £259,950 [Found by n/a]

* Status changed: from 'Available' to 'Premium Listing' [Found by n/a]

10 January 2011

* Price changed: from '£289,950' to '£279,950' [Found by n/a]

28 November 2010

* Initial entry found. [Found by n/a]

Edited February 18, 2011 by Van

[Van]

Full report here: http://www.home.co.uk/asking_price_index/HAPIndex_FEB11.pdf

Supply in each postcode area can be viewed here: http://www.rightmove.co.uk/house-prices-in-my-area/marketTrendsTotalAvailableListingsAndNew.html?searchLocation=nw1+8yd

Excellent links - thanks!

[ElPapasito]

They have this amazing quote at the beginning of their report - methinks they ***understand***

" If the American people ever allow private banks to control the issue of their currency, first by inflation, then by

deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until

their children wake-up homeless…" Thomas Jefferson, 3rd US President (1743 - 1826).

[Pent Up]

They have this amazing quote at the beginning of their report - methinks they ***understand***

" If the American people ever allow private banks to control the issue of their currency, first by inflation, then by

deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until

their children wake-up homeless…" Thomas Jefferson, 3rd US President (1743 - 1826).

Their reports are full of stuff like that. Its almost as if they have a very slight bearish bias...

[Tired of Waiting]

I would regard increasing supply as a very doubtful downward pressure as the majority don't seem "priced to sell" (...)

Even if they are/were, the relevant question is: Is this unrealistic majority similar, bigger or smaller than in Jan 2010?

I think the thousands, millions of pence have dropped since Jan 2010. Don't you?

I think more people back then still believed that he recession would be just a temporary thing, and then house prices would "come back up", remember? No longer!

[Tired of Waiting]

Excellent links - thanks!

You are welcome.

Yes, I like these data too.

I had noticed a much more bearish popular sentiment re. house prices in these past few months - and not only for the short term, but for the long term too. Add that to the very low volume we had in these past 3 years, I was guestimating that these "pent up supply" would probably hit the market this spring. The supply numbers from January confirm that. Let's see if February will keep the trend. I think it will.

.

Edited February 18, 2011 by Tired of Waiting

[Realistbear]

I suppose RB gets away with posting three threads on the same subject so why not

A great man once said:

"If anything is worth saying it is worth repeating, and if it is something of great value then it bears repeating often."

I can't argue with that.

[Tired of Waiting]

A great man once said:

"If anything is worth saying it is worth repeating, and if it is something of great value then it bears repeating often."

I can't argue with that.

+ 1

[Tired of Waiting]

http://www.rightmove.co.uk/property-for-sale/property-17509266.html?premiumA=true

Very nice style, reasonable internal area and layout, with a (little) veranda, OK location, Still, expensive, but not as insane as before. 20% down from here and it will be almost sensible.

Perhaps in 1 or 2 years?

.

Edited February 18, 2011 by Tired of Waiting

[Pent Up]

Prices are definitely softening up, and anything that is not in A-grade condition is getting a pummelling.

Look at this place in Balham - put on the market in Nov at 290k, cut to £280k last month, and now slashed to 250k today. That's 14% off within a matter of months. Now over-optimistic sellers like this might be few and far between, but my Rightmove searching is showing absolutely truckloads of similar price cuts on properties all over London. It'll be lucky to go for £230k imo. That's a massive difference between what they originally thought they could get and the reality of the market.

http://www.rightmove.co.uk/property-for-sale/property-17509266.html?premiumA=true

17 February 2011

* Price changed: Guide Price £259,950 £249,000 [Found by n/a]

03 February 2011

* Price changed: £279,950 Guide Price £259,950 [Found by n/a]

* Status changed: from 'Available' to 'Premium Listing' [Found by n/a]

10 January 2011

* Price changed: from '£289,950' to '£279,950' [Found by n/a]

28 November 2010

* Initial entry found. [Found by n/a]

Quarter of a million for that! Jeeeessssus. I'm so glad I don't live in London. Even after a significant HPC I wouldn't want to pay the prices there. Nice view of the bus depot/ industrial area from the balcony though and I'm sure you can barely hear that road at night.

I'll take this for the same price I think.

http://www.rightmove.co.uk/property-for-sale/property-27280279.html/nomsite?premiumA=true

[exiges]

Quarter of a million for that! Jeeeessssus. I'm so glad I don't live in London. Even after a significant HPC I wouldn't want to pay the prices there. Nice view of the bus depot/ industrial area from the balcony though and I'm sure you can barely hear that road at night.

That's the problem, so many people have been brainwashed that £300k is the norm for a shoebox like that, so when it goes down to £250k it appears to be a "saving", when in fact it's still stupidly overpriced.

[awaytogo]

I think this report from Home.co.uk deserves its own thread. Comparing Jan 2001 with Jan 2010), it shows a clear increase in the supply of new properties in the market, and in the frequency of asking prices reductions:

________________________________________________________________________________________

"Sellers Slash and Prices Tumble"

Summary

(...)

The number of properties reduced in price has leaped to 65,692 for the month of January, a massive 64% more than in January 2010.

(...)

Total properties new to market in Jan 2011 was 14% higher than in Jan 2010 [/b]

________________________________________________________________________________________

Full report here: http://www.home.co.uk/asking_price_index/HAPIndex_FEB11.pdf

Supply in each postcode area can be viewed here: http://www.rightmove.co.uk/house-prices-in-my-area/marketTrendsTotalAvailableListingsAndNew.html?searchLocation=nw1+8yd

.

Most of my Rightmove emails are the result of price reductions.

[Tired of Waiting]

Quarter of a million for that! Jeeeessssus. I'm so glad I don't live in London. Even after a significant HPC I wouldn't want to pay the prices there. Nice view of the bus depot/ industrial area from the balcony though and I'm sure you can barely hear that road at night.

I'll take this for the same price I think.

http://www.rightmove.co.uk/property-for-sale/property-27280279.html/nomsite?premiumA=true

Gorgeous garden.

But notice that the cottage's internal area is just 87.6sqm, and the London flat is 57sqm.

I think we may have some 20% nominal price falls in the next few years (2-3?), but I am not sure we will have greater nominal falls. And we will probably keep having inflation above target, at 4%, 5% or even more.

[Tired of Waiting]

That's the problem, so many people have been brainwashed that £300k is the norm for a shoebox like that, so when it goes down to £250k it appears to be a "saving", when in fact it's still stupidly overpriced.

I hope you are right, but I am not sure we will see more than 20% nominal price reductions. Perhaps 20% more via inflation, and another similar amount via sterling depreciation. Unfortunately our income will go down with 2 and 3.