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The Masked Tulip

Is The Welsh Housing Market On The Verge Of Collapse?

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Just got this article on welsh house prices in my inbox. Nothing new to HPCers but it talks about the state of the economy, banks being stuffed and asking prices being too high.

HPC also gets mentioned along with the land reg and the Haliwide price surveys.

There's a comment from someone who I can't figure out if they are pro a housing crash or anti a housing crash from what they have written. Is it one of us? Aren't we the only ones who waffle on about CDOs?

http://www.gogwatch.com/2011/09/13/guest-post-is-the-welsh-housing-market-on-the-verge-of-collapse/

Guest Post: Is the Welsh housing market on the verge of collapse?

The bad news for the faltering Welsh housing market just got a whole lot worse.

September is here and with it has come not just the end of the traditional spring to summer house buying season, but also a whole raft of economic data that points in just one direction – downwards – for Welsh house prices.

It is going to be a long, dark winter for Welsh estate agents and house sellers.

But Welsh asking prices remain very high.

Sites like Housepricecrash, which have long argued that Welsh asking prices are still at the near-bubble levels of late 2007, now report anecdotal evidence that some Welsh houses are selling for 20% below their asking price.

If this trend accelerates then a complete crash in the Welsh housing market may already be underway.

Only a fool would now dip their toe in a hugely over-priced housing market which could be on the verge of crashing – which brings us to Conwy County Borough Council.

It is going to act as mortgage guarantor with the banks for buyers of houses in its area. It will be a bit like the bank of Mum and Dad to the good people of Conwy who can’t afford to raise the 25% or 30% deposits to get a mortgage.

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Is The Welsh Housing Market On The Verge Of Collapse?

Yes.

Edited by Timm

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I'm Gog watching!

An almost 50% crash in asking price :D

Overpriced!

A very desirable area, almost as sought after as Mumbles :o

Many more like this appearing, if you know the history. If only Property Bee could track re-listings.

A couple of examples!

2007 asking price was £525,000 now asking £220,000 and not yet selling!

2006 asking of £550,000,recently sold at auction for 300,000

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I'm Gog watching!

An almost 50% crash in asking price :D

Overpriced!

A very desirable area, almost as sought after as Mumbles :o

Many more like this appearing, if you know the history. If only Property Bee could track re-listings.

A couple of examples!

2007 asking price was £525,000 now asking £220,000 and not yet selling!

2006 asking of £550,000,recently sold at auction for 300,000

Be careful when the tide comes in. :unsure:

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corrected for acuracy:

People like "The Masked Tulip" on Housepricecrash, which have long argued that Welsh asking prices are still at the near-bubble levels of late 2007, now report anecdotal evidence that some Welsh houses are selling for 20% below their asking price.

:lol:

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I'm Gog watching!

An almost 50% crash in asking price :D

Overpriced!

Its very dangerous to generalise from cases like these. That looks expensive when comparing it to general prices, but as more general prices have already fallen, these outliers don't necessarily indicate further falls of 50% for the market as a whole.

Its basically a big beach hut, not viable as a first home and as its essentially just a second holiday home its going to be far more affected by the fall in values than say, a home in the south east an hours commute from a banking job.

I think we will see average nominal falls of up to 50%, but an oddity like this could see a 75% fall while houses that are more desirable might only fall 15-25%

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corrected for acuracy:

People like "The Masked Tulip" on Housepricecrash, which have long argued that Welsh asking prices are still at the near-bubble levels of late 2007, now report anecdotal evidence that some Welsh houses are selling for 20% below their asking price.

:lol:

You are very kind sir. I would love to take all the credit but there are others on the Wales sub-forum who should also be praised.

I did go and view a house yesterday and the EA told me that the seller might take 20K off the price... but, as I pointed out, 20K was not even 10% below asking which is what the land reg says the average house sells for - 90% of asking. I give up with a lot of them.

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I'm from North West Wales (work/live in Manchester). Prices are ridiculous. Even if I took my OK Manchester salary back there it wouldn't buy much.

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I'm from North West Wales (work/live in Manchester). Prices are ridiculous. Even if I took my OK Manchester salary back there it wouldn't buy much.

Can't you move to Conwy and allow the Council to 'help' you get on the property ladder? :blink:

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Its very dangerous to generalise from cases like these.

Hilariously good fun in impo :D

Have you looked at the figures for North Wales? :huh::blink:

Last time I looked.

There was over 200 years supply, with an asking price of £500,000 or over, being marketed on Anglesey alone :lol:

Gotta laugh, or I would break down in tears, median wage is around £18,000p.a.!

From where will the money arrive, to prevent this market from gravely crashing? Serious question, genuinely curious.

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I'm Gog watching!

An almost 50% crash in asking price :D

Overpriced!

A very desirable area, almost as sought after as Mumbles :o

Many more like this appearing, if you know the history. If only Property Bee could track re-listings.

A couple of examples!

2007 asking price was £525,000 now asking £220,000 and not yet selling!

2006 asking of £550,000,recently sold at auction for 300,000

£10k for the beach hut! Final offer.

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Last time I looked.

There was over 200 years supply, with an asking price of £500,000 or over, being marketed on Anglesey alone :lol:

Gotta laugh, or I would break down in tears, median wage is around £18,000p.a.!

From where will the money arrive, to prevent this market from gravely crashing? Serious question, genuinely curious.

I was just talking to a friend about Wales in general - he got talking about Cowbridge, Cardiff, Swansea, Mumbles and he basically said that the average wages do not support the prices, lots of sellers are in debt so they are refusing to sell for anything other than their silly asking prices... but the low IRs are making the mortgage just about affordable so they can stay in the house.

Said, as we all know, once IRs rise they are fecked.

He said that there was a kind of collective denial in Wales at the moment re house prices. The economy is worsening but people are still believing that prices only ever rise.

Advised me to go and make a new life somewhere else.

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That's a bit generous!

Only ten years ago, £10k used to buy you a 2 bed terrace. :o

The view is nice and I'm loaded, more money than sense. :)

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I was just talking to a friend about Wales in general - he got talking about Cowbridge, Cardiff, Swansea, Mumbles

He said that there was a kind of collective denial in Wales at the moment re house prices. The economy is worsening but people are still believing that prices only ever rise.

Same up here denial, verging on panic.

Plenty of cognitive dissonance with aggression rising :o

Asking prices on Rightmove, as viewed with Property Bee, are dropping fast now.

Very few sales going through, mostly at the bottom end of the market and at good reductions on asking :D

As good as nothing selling in that 200 years of supply at the top end :P:lol::lol:

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Same up here denial, verging on panic.

Plenty of cognitive dissonance with aggression rising :o

Asking prices on Rightmove, as viewed with Property Bee, are dropping fast now.

Very few sales going through, mostly at the bottom end of the market and at good reductions on asking :D

As good as nothing selling in that 200 years of supply at the top end :P:lol::lol:

Hopefully the greeks will default, there will be a panic worse than lehmans and some will be forced to sell by dropping their prices considerably.

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I'm Gog watching!

An almost 50% crash in asking price :D

Overpriced!

A very desirable area, almost as sought after as Mumbles :o

Many more like this appearing, if you know the history. If only Property Bee could track re-listings.

A couple of examples!

2007 asking price was £525,000 now asking £220,000 and not yet selling!

2006 asking of £550,000,recently sold at auction for 300,000

Places like that are rarely Mortgageable and have been historically bought by cash buyers to make a decent return on Investment. So let us value you it on a return on investment for a cash buyer.

To buy a place like that you want a net rental income and return 30% over long-term rental rates. If Long-term rates are currently a net 6%, then you need 9% return (Although long-term is normally 9-10%) I think that given actual occupancy levels of 80% and therefore an annual gross income of £28,800. Running costs of Holliday lets (Cleaning etc) are circa 35% and so that gives a net return of £20,160. Then you need to minus 15% wear and tear. So that is a return of £17,136 p.a. At a required return of 9% that gives a value of £190,400. However at more traditional yields of 9% and therefore a requirement of 12% that gives a value of £142,500. That makes it 54% overvalued at £308,000 and shows how mad the world is! The price of the kit is about £90k built so that is valuing the land at £54k which is a lot for land you cannot live on!

N.

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  • 284 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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