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Flying Visit.... What's The Craic ?

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Hi everyone,I haven't been on here in a long time. Just thought I'd pop in and ask for a synopsis of the current postion. I'm hearing of increasing numbers of repossessions and wondered if it was having any effect on overall prices and transactions.

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Hi everyone,I haven't been on here in a long time. Just thought I'd pop in and ask for a synopsis of the current postion. I'm hearing of increasing numbers of repossessions and wondered if it was having any effect on overall prices and transactions.

All reports showing a slow down in falls with the ONS survey showing a 2% yoy increase. Most reporting increased volumes. Repo's still coming and that will continue.

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Hi everyone,I haven't been on here in a long time. Just thought I'd pop in and ask for a synopsis of the current postion. I'm hearing of increasing numbers of repossessions and wondered if it was having any effect on overall prices and transactions.

EAs have complained to me of reposessions "draging prices down" and, on the other hand banks not accepting "sensible offers" ie being inflexible. HP Reports should smooth out outlying high and low priced props and, so long as they are consistent in terms of historic data & baseline, the dragging down excuse doesn't hold water though it could cause problems when they value using their beloved "comparables" method.

Sales, esp to FTBers, do appear to be rising though average prices still falling (RPPI -1% Q1) indeed UUJ revised or adjusted a quarterly £8k average fall in Q1 to show prices rising - too many houses selling in the lower price brackets for their liking, apparently.

Newsletter recently did a decent article showing prices were at 2003 level. Media trying to conjure up good news and green shoots stories but in reality nothing much has changed, economy wise, with lower average wages, lower disposable income and tourist initiatives burning themselves out (Titanic/LegenDerry/WPF games/Causeway/G8) in spite millions of taxpayers funding and indeed Invest NI grants (whilst our image, or Brand NI ;) is tainted by widely reported negative antics). Lots of zombies, negative equity and debt big issues, construction sector still shrinking, banks still losing money.

Jamie delargey - UTV 'commentator' got sniffy over "Hotel based" auctions. The papers are certainly full of auction properties (though this does not necessarily imply either reposessed or distressed in all cases). We don't know what % of the market repos or indeed auctions represent - it is enough however for RPPI to include it. Co-ownership - the taxpayer funded sub-prime lending intervention that facilitates those that can't aford to buy a house is being pushed by politicians (it helps the hard pressed construction industry!!!) to the extent that this will approach 8-10% of all sales, notwithstanding further intervention or a reduction in overall house sales.

Check out the detailed stats table for Q1 where table 1 shows annual price falls falling from double to single digits and sales hovering between 11k to 13.5k pa over the past 5 years - not exactly lift off, given the composite sale types. NB higher sales have been accompanied by lower prices. Prices couldn't keep going down double digit or it would reach zero. Inflation is also corrosive to real prices.

http://www.nisra.gov.uk/HousePriceIndex/hpi.html

It has been suggested in some quarters that prices will now rise (modestly?) for the next three years (before imploding again). I suppose this is one scenario if interest rates remain at historic lows, banks pump more money into houses (lessons not learnt), people regain an appetite for major long term debt again (short memories), govt intervenes further (co ownership) and wages rise above inflation (unlikely - certainly not in the disproportionately large public sector).

The best scenario I can see is stagnation. Until prices reflect fundamentals and with EAs saying average sale prices (without auctions) are £130k - there is plenty of room for further falls. Welfare reforms reducing BTL profitability also have potential to impact and have yet to be fully imposed/implemented.

The crash is no longer a myth, it doesn't attract as much comment here or in the media as it is accepted, and not as sexy without the double digit drops. That doesn't mean it is over.

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Good post Shoto.

I think what is holding up the middle market in housing is the belief that 2007 prices quoted by EAs were realistic and vendors cannot accept the new reality of lower prices .

That is why there are so many houses languishing on the market for years with little hope of selling.

The 'won't sells', the 'can't sells' and the 'we'll just renters' because we can't get what we need/want. Accepting there has been a crash and crystallizing that by selling your mid market house are two different things - especially when banks are happy to facilitate and tolerate defaulters. It's becoming a very crowded segment - will the dam burst?

I used to get daily emails from property news each promoting several new properties - now I get perhaps a handful every month regarding a single, usually overpriced, house.

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Thanks Shoto et al.

Very succinct and informative.

Reckon there's a mini recovery afoot then another bust.........seems probable.

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Thanks Shoto et al.

Very succinct and informative.

Reckon there's a mini recovery afoot then another bust.........seems probable.

I wouldn't call it a recovery (let's give it a year), but it may be gleefully reported as such (and indeed I could very easily - probably? - be wrong). 2007 was madness and 50% of madness ain't necessarily sustainable, or normal - just half mad. A slower decline or the odd upward blip will be siezed upon, of course. Banks will be happy as the asset base they lent against apparently strengthens. Politicians will sieze on it as a "return to normality" in an abnormal economic environment.

All this, however, is set against the sugar rush of forbearance, historically low interest rates, QE, co ownership pump priming etc. The question is, however; is this the new normal or, at some stage, does reality kick in further? Can people (and banks) stay solvent longer than the market can stay irrational? Can politicains refrain from meddling and populus (in some quarters) interference using taxpayers money - cos it helps the construction industry!!!!!!! - and cos they can?

Finally another anectdotal - EAs saying rentals flying and lots looking to downsize. Heard the same about cars a couple of years ago when trading down for parents. Stats, I think, bear this out.

We'd be better off letting the poison out now and moving to some sort of normality but perhaps we're stuck with an artificial market, fed from London, based on the electoral cycle with our own home grown political pygmies sticking their nebs in and just making things infinitely worse, as they have quite abley shown themselves capable of - not least by a fear of welfare reform, no water rates, rate relief, rates cut off at £400k RV and the sub prime co-ownership scam.

What, come to think of it, would a 'recovery (from what, sustainability?) in the NI housing market look like - and set against what background? What would the repercussions of such a 'recovery' be, in the absence of any supporting foundations?

Are we about to find out?

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Co-ownership - the taxpayer funded sub-prime lending intervention that facilitates those that can't aford to buy a house is being pushed by politicians (it helps the hard pressed construction industry!!!) to the extent that this will approach 8-10% of all sales, notwithstanding further intervention or a reduction in overall house sales.

Check out the detailed stats table for Q1 where table 1 shows annual price falls falling from double to single digits and sales hovering between 11k to 13.5k pa over the past 5 years - not exactly lift off, given the composite sale types. NB higher sales have been accompanied by lower prices. Prices couldn't keep going down double digit or it would reach zero. Inflation is also corrosive to real prices.

http://www.nisra.gov.uk/HousePriceIndex/hpi.html

It has been suggested in some quarters that prices will now rise (modestly?) for the next three years (before imploding again). I suppose this is one scenario if interest rates remain at historic lows, banks pump more money into houses (lessons not learnt), people regain an appetite for major long term debt again (short memories), govt intervenes further (co ownership) and wages rise above inflation (unlikely - certainly not in the disproportionately large public sector).

The best scenario I can see is stagnation. Until prices reflect fundamentals and with EAs saying average sale prices (without auctions) are £130k - there is plenty of room for further falls. Welfare reforms reducing BTL profitability also have potential to impact and have yet to be fully imposed/implemented.

The crash is no longer a myth, it doesn't attract as much comment here or in the media as it is accepted, and not as sexy without the double digit drops. That doesn't mean it is over.

Co-ownership is not a new facility. It has been around since 1978. They have assisted in the purchase of over 21,000 houses. That averages around 630 per year. I understand they have either increased this to 900 or are hoping to increase this to 900 per year. I don't see this increase as much of an intervention. Most of their purchases are resales so I am not so sure how this assists the construction industry massivly. However it is a help and they are only making up for a small part of the lack in 'sensible' bank lending.

Jonathan Davis, I understand suggested that prices would rise for 3 years (as he predicted!) and then fall again after the next election as the 'Help to Buy' scheme was phased out. I expect, when he said this on the NI Nolan Show he wasn't aware that the Help to Buy scheme is not coming to NI. Can anyone find when or where he made the previous prediction, he alluded to that NI house prices would rise over the next three years. I have been beaten again and JD can again claim that he was the first to predict, this time a increase in prices in NI.

BTL profitability, ironically has perhaps never been better in the ratio of rent to average price.

Has anyone seriously been claiming that the crash is a Myth. When was it a Myth?

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I wouldn't call it a recovery (let's give it a year), but it may be gleefully reported as such (and indeed I could very easily - probably? - be wrong). 2007 was madness and 50% of madness ain't necessarily sustainable, or normal - just half mad. A slower decline or the odd upward blip will be siezed upon, of course. Banks will be happy as the asset base they lent against apparently strengthens. Politicians will sieze on it as a "return to normality" in an abnormal economic environment.

All this, however, is set against the sugar rush of forbearance, historically low interest rates, QE, co ownership pump priming etc. The question is, however; is this the new normal or, at some stage, does reality kick in further? Can people (and banks) stay solvent longer than the market can stay irrational? Can politicains refrain from meddling and populus (in some quarters) interference using taxpayers money - cos it helps the construction industry!!!!!!! - and cos they can?

Finally another anectdotal - EAs saying rentals flying and lots looking to downsize. Heard the same about cars a couple of years ago when trading down for parents. Stats, I think, bear this out.

We'd be better off letting the poison out now and moving to some sort of normality but perhaps we're stuck with an artificial market, fed from London, based on the electoral cycle with our own home grown political pygmies sticking their nebs in and just making things infinitely worse, as they have quite abley shown themselves capable of - not least by a fear of welfare reform, no water rates, rate relief, rates cut off at £400k RV and the sub prime co-ownership scam.

What, come to think of it, would a 'recovery (from what, sustainability?) in the NI housing market look like - and set against what background? What would the repercussions of such a 'recovery' be, in the absence of any supporting foundations?

Are we about to find out?

I agree a 2% increase after 6 years of falls is not a recovery but hopefully the bottom. You would need to see a number of successive quarters of growth before one could claim a recovery is in place and there will still be the odd dip in between.

I am not aware of any feeding from London, concerning the election into the market here. Please advise.

Recover in relation to supporting foundations. I presume you are referring to a multiplier of average house price or borrowed amount from household income. Some reports place NI as the most favourable region of the whole UK on that, which is a position we dont normally enjoy. I think with a 50% price fall everyone has to acknowledge that has improved dramatically.

If you honestly believe the Co-ownership housing association is operating a scam or anything hinting at fraud please report immediately to the police.

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Co-ownership is not a new facility. It has been around since 1978. They have assisted in the purchase of over 21,000 houses. That averages around 630 per year. I understand they have either increased this to 900 or are hoping to increase this to 900 per year. I don't see this increase as much of an intervention. Most of their purchases are resales so I am not so sure how this assists the construction industry massivly. However it is a help and they are only making up for a small part of the lack in 'sensible' bank lending.

Jonathan Davis, I understand suggested that prices would rise for 3 years (as he predicted!) and then fall again after the next election as the 'Help to Buy' scheme was phased out. I expect, when he said this on the NI Nolan Show he wasn't aware that the Help to Buy scheme is not coming to NI. Can anyone find when or where he made the previous prediction, he alluded to that NI house prices would rise over the next three years. I have been beaten again and JD can again claim that he was the first to predict, this time a increase in prices in NI.

BTL profitability, ironically has perhaps never been better in the ratio of rent to average price.

Has anyone seriously been claiming that the crash is a Myth. When was it a Myth?

Some vendors think it is a myth going by prices. My point was it took many people and media sources a long time to call a spade a spade. Of course, when presented with the evidence, everyone saw it coming and recognised it straight away. That's why I joined this site - the media wasn't reporting what I was seeing and hearing.

VIs have been calling the bottom for years - to some it is a correction - I'm not sure I've ever heard RICS call it a crash - or a bubble.

JD's prediction from 17 July - Nolan

http://jonathandaviswm.com/jonathan-davis-media/618/

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I agree a 2% increase after 6 years of falls is not a recovery but hopefully the bottom. You would need to see a number of successive quarters of growth before one could claim a recovery is in place and there will still be the odd dip in between.

I am not aware of any feeding from London, concerning the election into the market here. Please advise.

Recover in relation to supporting foundations. I presume you are referring to a multiplier of average house price or borrowed amount from household income. Some reports place NI as the most favourable region of the whole UK on that, which is a position we dont normally enjoy. I think with a 50% price fall everyone has to acknowledge that has improved dramatically.

If you honestly believe the Co-ownership housing association is operating a scam or anything hinting at fraud please report immediately to the police.

[/quote

Feeding from London - London centric interest rates and monetary policy, a bit like ECB rates for (Germany) Ireland. That went well.

50% of madness is still half mad and not necessarily normal (or affordable).

Surely not all scams/rackets are illegal? The definition of a scam is a confidence trick - ie you know that (affordable!!) house you can't afford well you can afford it(sort of) and help the construction industry and keep sales and prices up - everyone's a winner.

https://en.wikipedia.org/wiki/Confidence_trick

A confidence trick is also known as a con game, a con, a scam, a grift, a hustle, a bunko (or bunco), a swindle, a flimflam, a gaffle or a bamboozle. The intended victims are known as "marks" or "suckers", and when accomplices are employed, they are known as shills.

I think the rollers have enough on their plate already but, after NIHE, who knows what could come crawling out of the woodwork. Politicians and developers make for interesting copy here and in ROI, historically.

I'd like to see a deep dive audit to identify if taxpayer's money is obtaining value for money, what losses have been incurred, how much was spent on property during the madness and what inherent risks are being taken with public money and who, if anyone, is exposed.

Supporting foundations - a gradual return to sensible lending by banks which is immediately circumvented by strengthening govt schemes such as co-ownership here and Help to Buy elsewhere.

You are very attached to the ONS figure now.

Edited by Shotoflight

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Feeding from London - London centric interest rates and monetary policy, a bit like ECB rates for (Germany) Ireland. That went well.

50% of madness is still half mad and not necessarily normal (or affordable).

Surely not all scams/rackets are illegal? The definition of a scam is a confidence trick - ie you know that (affordable!!) house you can't afford well you can afford it(sort of) and help the construction industry and keep sales and prices up - everyone's a winner. I think the rollers have enough on their plate already but, after NIHE, who knows what could come crawling out of the woodwork. Politicians and developers make for interesting copy here and in ROI, historically.

I'd like to see a deep dive audit to identify if taxpayer's money is obtaining value for money, what losses have been incurred, how much was spent on property during the madness and what inherent risks are being taken with public money and who, if anyone, is exposed.

Supporting foundations - a gradual return to sensible lending by banks which is immediately circumvented by strengthening govt schemes such as co-ownership here and Help to Buy elsewhere.

You are very attached to the ONS figure now.

I am sorry I don't understand your first two sentences, in bold above.

I am not attached to any particular figures or surveys and have presented and commented on most. I was particularly fond of the Nationwide because of its historical data and ability to compare over different regions, however I had to acknowledge its drop in market share here to about 7%. I have often pointed out the weakness in many such as the Nationwide and UUJ and most recently the NIRPPI, whilst, at the same time welcoming their in-depth analysis.

I am interested in your opinion of scams.

The definition of a scam is;

'A fraudulent business scheme; a swindle.'

'a dishonest scheme; a fraud' Oxford Dictionary.

A scam is an illegal trick, usually with the purpose of getting money from people or avoiding paying tax. Collins English Dictionary.

Again if you believe that Co-ownership is in any way operating a 'scam' please immediately report this possible illegal misuse of public money to the police.

I think we would all like to see a return to sensible lending. Not the mad easy credit boom of 2006 or the credit drought seen since.

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Some vendors think it is a myth going by prices. My point was it took many people and media sources a long time to call a spade a spade. Of course, when presented with the evidence, everyone saw it coming and recognised it straight away. That's why I joined this site - the media wasn't reporting what I was seeing and hearing.

VIs have been calling the bottom for years - to some it is a correction - I'm not sure I've ever heard RICS call it a crash - or a bubble.

JD's prediction from 17 July - Nolan

http://jonathandaviswm.com/jonathan-davis-media/618/

When you joined this site in Feb 2009 there was no Myth. The Media were well and truly calling it a property crash. Prices had fallen almost 40% by that stage.

Some examples of media reporting, prior to 2009 below.

From Antrim to Tyrone, the bubble has truly burst2 November 2008 My link

House prices fall £46k in yearNov 2008 Newsletter My link

Property market in Northern Ireland plummeting five times fasterAug 2008 My link

I wouldn't pay much attention to what the RICS say. After all they were predicting that there would be no crash. They are the people who continued to value houses and land at peak prices after most realised the game was up.

A crash is a correction. Bringing prices back to a correct level. It may overshoot but so be it.

Yes I have listened to JD's prediction from 17 July on Nolan.

In it he tells Nolan that he is not at all surprised by this upturn and he had predicted it 6 weeks ago-saying prices would rise for the next 2 or 3 years. I don't recall that prediction, which must have been around early June. He had previously predicted that prices would fall 70% [or perhaps 80%] in Northern Ireland.

Edited by BelfastVI

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When you joined this site in Feb 2009 there was no Myth. The Media were well and truly calling it a property crash. Prices had fallen almost 40% by that stage.

Some examples of media reporting, prior to 2009 below.

From Antrim to Tyrone, the bubble has truly burst2 November 2008 My link

House prices fall £46k in yearNov 2008 Newsletter My link

Property market in Northern Ireland plummeting five times fasterAug 2008 My link

I wouldn't pay much attention to what the RICS say. After all they were predicting that there would be no crash. They are the people who continued to value houses and land at peak prices after most realised the game was up.

A crash is a correction. Bringing prices back to a correct level. It may overshoot but so be it.

Yes I have listened to JD's prediction from 17 July on Nolan.

In it he tells Nolan that he is not at all surprised by this upturn and he had predicted it 6 weeks ago-saying prices would rise for the next 2 or 3 years. I don't recall that prediction, which must have been around early June. He had previously predicted that prices would fall 70% [or perhaps 80%] in Northern Ireland.

No sign of a crash with these ones. Thanks for your links - I'm obviously not as widely read as I thought I was (propertywire?).

So prices have only fallen 10% in the past 5 yrs?

http://www.bbc.co.uk/news/uk-northern-ireland-23582302

A south Belfast mansion was overvalued by up to £2m, a High Court judge has ruled.

Mr Justice Weatherup ruled the property in Shaw's Bridge was wrongly assessed as being worth £5m in 2009.

The house should instead have been valued at between £3m and £3.75m, he said.

Aurora Leasing sued the Belfast office of estate agent Colliers, claiming it was negligent with its valuation.

Edited by Shotoflight

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I am sorry I don't understand your first two sentences, in bold above.

I am not attached to any particular figures or surveys and have presented and commented on most. I was particularly fond of the Nationwide because of its historical data and ability to compare over different regions, however I had to acknowledge its drop in market share here to about 7%. I have often pointed out the weakness in many such as the Nationwide and UUJ and most recently the NIRPPI, whilst, at the same time welcoming their in-depth analysis.

I am interested in your opinion of scams.

The definition of a scam is;

'A fraudulent business scheme; a swindle.'

'a dishonest scheme; a fraud' Oxford Dictionary.

A scam is an illegal trick, usually with the purpose of getting money from people or avoiding paying tax. Collins English Dictionary.

Again if you believe that Co-ownership is in any way operating a 'scam' please immediately report this possible illegal misuse of public money to the police.

I think we would all like to see a return to sensible lending. Not the mad easy credit boom of 2006 or the credit drought seen since.

I'll stick with my definition of a scam as a confidence trick. But you've set me thinking along the lines of a FOI request. I'll come back on that one.

I don't believe there is a credit drought for credit worthy borrowers - less of an appetite perhaps but banks are promoting mortgage lending and credit cards with historically cheap rates. I'm getting junk mail again for credit cards.

BOE does not set interest rates with NI in mind much as EU rates were not set with the smaller countries in mind - basically credit was too cheap in ROI for its economy.

50% drops from the 07 peak are not necessarily a good baseline to call affordability on, in my opinion.

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So prices have only fallen 10% in the past 5 yrs?

In all reports, including the NIPPI the falls are generally the same. about 40% up to the start of 2009. They all show the level now at 50% to 55%.

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In all reports, including the NIPPI the falls are generally the same. about 40% up to the start of 2009. They all show the level now at 50% to 55%.

A 40% fall up to the start of 2009 and a 50% fall up to now does not imply a 10% fall in prices from 2009 until now. It implies a fall of around 16-17% from 2009 until now.

For example a house valued at £200k at peak

After a 40% fall to 2009 the hose would then be vaued at £200k * 60% = £120k

After a 50% fall from peak the house would be valued at £200k * 50% = £100k

But the fall from 2009 until now in % terms is 1 - £120k/£100k = 16.67%

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Hi again everyone,

As some of you know I bought around this time last year. I don't pay much attention to prices now because I feel I got a reasonable house at a reasonable price that wouldn't cripple me financially.

I do think there are reasonable deals to be had out there and this forum provided me with the knowledge and confidence to get what I believed was fair.

Hang in there and keep looking the stressors out there might provide you with the opportunity to get what you want. Bargain hard..... It's a buyers market. B)

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A 40% fall up to the start of 2009 and a 50% fall up to now does not imply a 10% fall in prices from 2009 until now. It implies a fall of around 16-17% from 2009 until now.

For example a house valued at £200k at peak

After a 40% fall to 2009 the hose would then be vaued at £200k * 60% = £120k

After a 50% fall from peak the house would be valued at £200k * 50% = £100k

But the fall from 2009 until now in % terms is 1 - £120k/£100k = 16.67%

I simply stated they had fallen 40% up to early 2009, It was Shotoflight who mentioned 10% from then on.

A further 10% would have been a more mathematical correct way of putting it.

Edited by BelfastVI

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Some posters still have an obsession with the "from peak" reference 6 years on.

In replying to your comments about the crash only a Myth up until you came on the scene in 2009, I felt I had to discuss what had actually happened by that stage (ie approximately 75% of the price reductions to date).

A forum names HousePriceCrash is going, from time to time refer back to the start of the crash and measure its progress. I will as required refer to that subject.

The crash has lasted 6 years and I imagine many here believe it could continue. Of course it will be discussed and why shouldn't it.

An obsession? I work in the industry and have a valid interest in many, many aspects of the subject. You post here every day (not that I am complaining). Have you an obsession?

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Yes I have listened to JD's prediction from 17 July on Nolan.

In it he tells Nolan that he is not at all surprised by this upturn and he had predicted it 6 weeks ago-saying prices would rise for the next 2 or 3 years. I don't recall that prediction, which must have been around early June. He had previously predicted that prices would fall 70% [or perhaps 80%] in Northern Ireland.

JD June 11 Doesn't mean 70% fall out of the picture. All time bottom may not yet be in. Qui sais?

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There's been a noticable drop in detached houses coming up for sale this past few months around me as mentioned earlier. Two agents have said that the first 6 months were very busy compared to previous years but theres very few new instructions coming in now. Did have another agent tell me that prices were rising and to buy now while I still can, was a bit of a time warp moment.

One new thing is the steady drip of "ATTRACTIVELY PRICED PROPERTY" with a certain agency that have some of the worst photos possible and are not remotely attractive, not sure what these people are thinking.

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