Where Are We At?

[talksalot81]

Hey guys,

Many of you know I was here when the brown stuff was so obviously going to hit the far and i have to admit that I have lost touch having no real way of moving on. After a few years of saving and a few years of getting older, it really is time to get on the move.

I have been doing some trawling over the last while and there are a bunch of properties out there but they are almost all well in advance of the ratable values. So what is the accepted logic at the moment in terms of pricing? Are we still hoping to push people down to the ratable numbers? This seems a long way down on many properties, often another 20%. Do we have any real evidence of a seller accepting £135k on the property they marketed at 170? Do we have any evidence of what sellers are genuinely entertaining? It is a ridiculous question, that I know, but is the starting price 10% on the low side or more?

Ta for the thoughts!

[tinbin]

Hey guys,

Many of you know I was here when the brown stuff was so obviously going to hit the far and i have to admit that I have lost touch having no real way of moving on. After a few years of saving and a few years of getting older, it really is time to get on the move.

I have been doing some trawling over the last while and there are a bunch of properties out there but they are almost all well in advance of the ratable values. So what is the accepted logic at the moment in terms of pricing? Are we still hoping to push people down to the ratable numbers? This seems a long way down on many properties, often another 20%. Do we have any real evidence of a seller accepting £135k on the property they marketed at 170? Do we have any evidence of what sellers are genuinely entertaining? It is a ridiculous question, that I know, but is the starting price 10% on the low side or more?

Ta for the thoughts!

Its a complete stalemate between buyers and sellers. The Industry reports drops of approx 50% but yet sellers, developers and EA's are digging in and refusing to pass on these drops.

50% drop from peak would be about 20-30% less than the current asking prices in my area. Serious reality check is needed ... Good time to buy, im not so sure. I still think there is a way to go yet.

[talksalot81]

I suspect that there remains some way to go, especially if nothing new happens before interest rates start rising. Realistically I am 6 months from wanting to commit but that makes this the perfect time to get the finger out and see what the market looks like.

[kenny dalglish]

Currently looking to buy in Torbay, Devon, here's what I have observed...

There really is no sense of reality amongst sellers. I have been looking for about 3 years now and I would say the following pattern is probably accurate for about 90% of buyers...

- place house on market for about 10% above the price of the last house sold. Often that is well above 2007 peak levels

- after a few months possibly change agents

- after about 6 months drop by maybe 5,000 or 2-3%

- after another 3 months drop by another 5,000 or 2-3%

- after another 3 months, drop a bit further/change EA / take off the market

In the three years I estimate - without exageration - that I have seen approximately 5 houses out of probably 700+ that I have looked at (not been to see, just looked at the details on RM) that have been good value. By GV I mean, reasonably placed, good condition etc they have all sold. I have lost count of properties that have been on the market for literally 2 or more years that have not even dropped their price.

I cannot see this changing. IR are so low, sellers can afford to wait until the 'good times' come back. They won't of course. What many of them fail to realize is that inflation is essentially re-correcting their house price for them. It may take 5-10 years, but eventually there house will be back to the 3.5 x average salary, which is the average trend (assuming salaries rise). Of course, the down side to this is that my savings are also being eroded and I need somewhere to live, also, I am v. uncomfortable about cash in the bank as I genuinely believe that we could easily tip into hyper-inflation or a there could be a run on a bank soon.

Just recently we saw a house for 250K, it was overpriced. It's not even close to being our ideal house, but does meet a lot of our criteria. We offered 210K as an opener, expecting some negotiation, nothing, zip, nada. The EA told us that they were looking for near the ask. After another month we offered 220K, expecting negotiations to open, nothing, not even a desire to negotiate. We have decided to let it go, noone else has made an offer the EA told me.

The conclusion that I have come to is that even IF there is a property that came on tomorrow that I liked the look of, it would be overpriced and that there is not even any point attempting negotiations until 6 months into the future, it really is taking people that long to realize that there house perhaps is not worth what they assumed it was...

[fallingbuzzard]

Location is what matters. I know places 20% above peak and going up rapidly, and others 40% below peak with no market.

Hey guys,

Many of you know I was here when the brown stuff was so obviously going to hit the far and i have to admit that I have lost touch having no real way of moving on. After a few years of saving and a few years of getting older, it really is time to get on the move.

I have been doing some trawling over the last while and there are a bunch of properties out there but they are almost all well in advance of the ratable values. So what is the accepted logic at the moment in terms of pricing? Are we still hoping to push people down to the ratable numbers? This seems a long way down on many properties, often another 20%. Do we have any real evidence of a seller accepting £135k on the property they marketed at 170? Do we have any evidence of what sellers are genuinely entertaining? It is a ridiculous question, that I know, but is the starting price 10% on the low side or more?

Ta for the thoughts!

[neon tetra]

I'm looking for an anxious seller who will come in at rateable value or below.

May be a dumb question, but, what is ratable value, and how is it found out for a particular property? Is it to do with the council tax banding?

[talksalot81]

An off topic.... does anyone know where you can find the last version of firefox which works with property bee? I was updated a couple of weeks back and property bee is totally dead with it...

[Spoony]

Of course, the down side to this is that my savings are also being eroded and I need somewhere to live, also, I am v. uncomfortable about cash in the bank as I genuinely believe that we could easily tip into hyper-inflation or a there could be a run on a bank soon.

So whats the answer? Buying a house even though its overpriced? Surely a house would be eroded as much as cash would in a hyperflation situation?

[pajd]

In my area not one EA has sold a house since the middle of June. EA and sellers are being stubborn. The biggest factor which could well change this is a rise in IR. When is this going to happen though?

[nigooner]

An off topic.... does anyone know where you can find the last version of firefox which works with property bee? I was updated a couple of weeks back and property bee is totally dead with it...

You need to uninstall the whole of firefox, and then search for firefox 4 and download an reinstall it. When it asks if you want to update,click no

[getdoon_weebobby]

ive seen many examples of 50% drops in fermanagh , portstewart and South Belfast (this is where I am looking to buy).

but BT9 had the most ridiculous overpriced property in 2007 (detached houses all going on for 7 figure sums)

even what is 50% off is still overpriced , unless its around RV the buyer is surely is not going to get a mortgage

these were 700k+

rv 375

http://www.ulsterpropertysales.co.uk/property-specific.aspx?ID=38284

at the same time many properties are well overvalued

i am away on holiday for a few days and when back may offer rv+11% on a property which is still asking rv+30% ( but that was asking rv+150%)

Edited July 6, 2011 by getdoon_weebobby

[getdoon_weebobby]

So whats the answer? Buying a house even though its overpriced? Surely a house would be eroded as much as cash would in a hyperflation situation?

i believe that high inflation would help the house price crash in short to medium term as people are squeezed , struggling to make ends meet as food heating etc etc prices rise more than wages. eventually in the longer term inflation would eventually start to drag prices up

Edited July 6, 2011 by getdoon_weebobby

[talksalot81]

I had been waiting for inflation because the implicit need for increased rates to control it would lead to less money in house owners pockets. This would mean that those who bought when they could not afford it, yet who have been protected by artificially low rates, would now be exposed to the consequences of their actions and may well be forced to sell rather than able to hold position and hold up the rest of the market.

However, I don't know when the powers that be are going to admit to inflation. As a manufacturer, I know there is massive inflation far beyond the consumer will see but the government and bank is denying it.

[NuBrit]

Prices are still coming down across the board in the Craigavon Borough; at the lower end, there is some activity too. Generally though, the market is going practically nowhere, far too many ordinary houses on the market looking for silly prices like £300k. There was a flurry of activity at the start of Summer with some decent price drops, although that appears to have slowed down as of late. I don't think we're a million miles away from fair value at this stage. I think 15-20% will do it, so if you have a timeframe of buying in three years or so, I think it will work out very well for you.

[2buyornot2buy]

Prices are still coming down across the board in the Craigavon Borough; at the lower end, there is some activity too. Generally though, the market is going practically nowhere, far too many ordinary houses on the market looking for silly prices like £300k. There was a flurry of activity at the start of Summer with some decent price drops, although that appears to have slowed down as of late. I don't think we're a million miles away from fair value at this stage. I think 15-20% will do it, so if you have a timeframe of buying in three years or so, I think it will work out very well for you.

What do you mean when you say 15-20%? Do you mean a sill priced 300K house will drop to 240k? I know where I am I expect to see these 300K houses dropping to around 180K max. Or are you talking a further 20% from peak (BVI will love this. His favourite point of reference ).

[tinbin]

I had been waiting for inflation because the implicit need for increased rates to control it would lead to less money in house owners pockets. This would mean that those who bought when they could not afford it, yet who have been protected by artificially low rates, would now be exposed to the consequences of their actions and may well be forced to sell rather than able to hold position and hold up the rest of the market.

However, I don't know when the powers that be are going to admit to inflation. As a manufacturer, I know there is massive inflation far beyond the consumer will see but the government and bank is denying it.

4/5 yr fixed rate MTG deals from 2006/2007 are now coming to an end, this will put pressure on many. Plenty of ppl are seriously worried about the impact of rate rises in the future.

Everytime you need to order oil, or get a gas bill it is felt. Anybody tried to book a holiday lately ... £2k plus for a week for a family of 4. Weekly shopping bills more expensive, petrol costs massive .... and the list goes on and on and on.

Trust me the effects are being felt ... infaltion has grown faster than wages for approx 5 years if the reports are correct. Throw in housing bubbles in the middle and the after effects that it will cause.

It is a timebomb waiting to go off ... the sooner the better. If ppl want to have some sort of financial comfort in their lives i.e. food in the cupboard then something has to give sooner rather than later. I dont see any scenario whereby it can correct itself. Wage inflation is clearly not going to happen so it looks like we are all screwed the longer it all goes on. It clearly is an economic disaster

Edited July 6, 2011 by tinbin

[2buyornot2buy]

4/5 yr fixed rate MTG deals from 2006/2007 are now coming to an end, this will put pressure on many. Plenty of ppl are seriously worried about the impact of rate rises in the future.

Everytime you need to order oil, or get a gas bill it is felt. Anybody tried to book a holiday lately ... £2k plus for a week for a family of 4. Weekly shopping bills more expensive, petrol costs massive .... and the list goes on and on and on.

Trust me the effects are being felt ... infaltion has grown faster than wages for approx 5 years if the reports are correct. Throw in housing bubbles in the middle and the after effects that it will cause.

It is a timebomb waiting to go off ... the sooner the better. If ppl want to have some sort of financial comfort in their lives i.e. food in the cupboard then something has to give sooner rather than later. I dont see any scenario whereby it can correct itself. Wage inflation is clearly not going to happen so it looks like we are all screwed the longer it all goes on. It clearly is an economic disaster

I think these people are being saved by low SVR. I know lots of people with multiple BTLs who would consider themselves rather well off as a result of near zero interest rates. (They forget about the fall in capital value and have IO mortgages). I know lots of people who have reverted to lifetime trackers at base+ 0.89%. These people think they've never had it so good and a £100 of pounds better off. There is no moral hazard. The government policy is to carry on with the status quo no matter what the consequences. Luckily we live in NI where IMPO the UK don't really give a toss about. The Northern can throw about is parent guaranteed 100% LTV trackers, people can carry on holding out for 350K for a south Belfast semi but it wont matter a jot. Transaction levels are low, interest rates can't stay low forever, prices are static or dropping, sentiment is negative, the public sector cuts haven't begun, builders are failing everywhere, NAMA is coming to a town near you and Greece/Ireland will go bang anytime.

I'd give it another year or so if I was you.

[NuBrit]

What do you mean when you say 15-20%? Do you mean a sill priced 300K house will drop to 240k? I know where I am I expect to see these 300K houses dropping to around 180K max. Or are you talking a further 20% from peak (BVI will love this. His favourite point of reference ).

Those 300k properties are still at 2008 prices. What I am saying is that the properties that are the cheapest today in their categories will need to fall by about 15-20%.

[BelfastVI]

I think these people are being saved by low SVR. I know lots of people with multiple BTLs who would consider themselves rather well off as a result of near zero interest rates. (They forget about the fall in capital value and have IO mortgages). I know lots of people who have reverted to lifetime trackers at base+ 0.89%. These people think they've never had it so good and a £100 of pounds better off. There is no moral hazard. The government policy is to carry on with the status quo no matter what the consequences. Luckily we live in NI where IMPO the UK don't really give a toss about. The Northern can throw about is parent guaranteed 100% LTV trackers, people can carry on holding out for 350K for a south Belfast semi but it wont matter a jot. Transaction levels are low, interest rates can't stay low forever, prices are static or dropping, sentiment is negative, the public sector cuts haven't begun, builders are failing everywhere, NAMA is coming to a town near you and Greece/Ireland will go bang anytime.

I'd give it another year or so if I was you.

Can you find me a link to a lift time tracker of base + 0.89%

[2buyornot2buy]

Can you find me a link to a lift time tracker of base + 0.89%

Here's one at 0.99

http://www.ft.com/cms/s/0/2b3e1cf2-bdb8-11dd-bba1-0000779fd18c.html#axzz1RKlfpLLa

C&G and woolwich/Barclays were offering as low as 0.17 above base. Google my friend. I believe First Trust offered competitive lifetime trackers also.

[getdoon_weebobby]

i have a friend in london the place he bought for 400k in 2004 , mortgage was with woolwich at +0.18%

unsurprisingly he is a happy man....

yes these days no longer exist but plenty of people are curently on them

[BelfastVI]

Here's one at 0.99

http://www.ft.com/cms/s/0/2b3e1cf2-bdb8-11dd-bba1-0000779fd18c.html#axzz1RKlfpLLa

C&G and woolwich/Barclays were offering as low as 0.17 above base. Google my friend. I believe First Trust offered competitive lifetime trackers also.

Your link dosent appear to lead to the article you have mentioned, or perhaps, as I am not a paid up member of the FT I got redirected to their front page. The only property related story was about some house price bounce in June.

Checked with Woolwich and the lowest I could find was 1.89% "Tracks at 1.89% above the Barclays Bank Base". Not sure what Barclays base rate is but it would be whatever they want it to be.

I did Google and I see Santander are offering a Lifetime tracker of 1.89% over BOE base for a £999 fee. Its limited to 60% L2V but it exists. Not as low as the ones you have found but it exists. Not sure I would go for its there. A 1% over BoE base is a good deal, if you want to risk the market. I myself fixed at 3.5%, may be proved wrong but ye takes ye bets.

[azogar]

Your link dosent appear to lead to the article you have mentioned, or perhaps, as I am not a paid up member of the FT I got redirected to their front page. The only property related story was about some house price bounce in June.

Checked with Woolwich and the lowest I could find was 1.89% "Tracks at 1.89% above the Barclays Bank Base". Not sure what Barclays base rate is but it would be whatever they want it to be.

I did Google and I see Santander are offering a Lifetime tracker of 1.89% over BOE base for a £999 fee. Its limited to 60% L2V but it exists. Not as low as the ones you have found but it exists. Not sure I would go for its there. A 1% over BoE base is a good deal, if you want to risk the market. I myself fixed at 3.5%, may be proved wrong but ye takes ye bets.

click on top-link to get behind paywall

http://www.google.co.uk/search?q=FT.com+Deal+of+a+lifetime&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-GB:official&client=firefox-a

[2buyornot2buy]

Your link dosent appear to lead to the article you have mentioned, or perhaps, as I am not a paid up member of the FT I got redirected to their front page. The only property related story was about some house price bounce in June.

Checked with Woolwich and the lowest I could find was 1.89% "Tracks at 1.89% above the Barclays Bank Base". Not sure what Barclays base rate is but it would be whatever they want it to be.

I did Google and I see Santander are offering a Lifetime tracker of 1.89% over BOE base for a £999 fee. Its limited to 60% L2V but it exists. Not as low as the ones you have found but it exists. Not sure I would go for its there. A 1% over BoE base is a good deal, if you want to risk the market. I myself fixed at 3.5%, may be proved wrong but ye takes ye bets.

Sorry BVI I'm not talking about new lending but the large number of people on cheap lifetime trackers. These people have never had it so good. The BOE also states that mortgage rates are the lowest for 23 years. (Already provided you a link to that one).

You don't know people on lifetime trackers below 1%? Really? I sure everone who posts here knows at least someone.

[tinbin]

Sorry BVI I'm not talking about new lending but the large number of people on cheap lifetime trackers. These people have never had it so good. The BOE also states that mortgage rates are the lowest for 23 years. (Already provided you a link to that one).

You don't know people on lifetime trackers below 1%? Really? I sure everone who posts here knows at least someone.

Anyone who was on a variable rate MTG and stayed on this type of MTG as interest rates came down to record lows have seen significant reductions in their mtg payments. That is a matter of fact.

There are many who are on BRT mtgs who have never had it so good with the low interest rates and there are many under 1%.

If you took out a BRT mortgage in 2006, you may have been paying say Base Rate + 0.39 = 5.89% (when base rate was 5.5%). Now that rates have dropped the MTG package has not changed ... it remains Base Rate + 0.39% which equals 0.89%.

I think sometimes we forget that plenty of ppl bought houses before the boom and not everyone was scare-mongered into taking a fixed rate. The hefty booking fee's and arrangement fee's dont & didnt appeal to everyone. Fixed rates where not significantly better back then. Seldom below 4.5% for 2/3 yrs. By the time u paid the booking & arrangement fee every time the fixed rate expired to go into another it didnt always work out as a favourable option. It is misguided to assume that everyone took out fixed rates.