UK house prices likely to keep falling for another six months - Guardian

[Saving For a Space Ship]

 UK house prices likely to keep falling for another six months

 

https://www.theguardian.com/money/2019/apr/11/uk-house-prices-likely-to-keep-falling-for-another-six-months

[nome]

Keep falling?

I'm still waiting for them to stop rising in my areas of interest.

[Spindler]

asking prices are one thing....selling prices are another...I've bought and sold enough houses to know that....just like my buddy in the SE 305k...3 fallen through sales....he is very pragmatic and is selling to rent....has no mortgage and cash in the bank....it s finally going through afer 2 years for 235k....not many will be so pragmatic and will cling to their fantasy valuations or simply be so indebted they cannot afford to sell at that level....unless in real financial stress.....if someone had bought that flat at peak few years back at max loan to value chances are they would be in Neg Equity and unable to sell.....if any prices in the UK are still rising its just the delayed effect of the London and South East boom and probably money from sales in these areas being used to buy and outbidding locals....this is a finite situation and they will suddenly experience a vaccuum of no buyers at all.....local or otherwise....

[Peter Hun]

And thats another 120K Boomer probate sales and 6months closer to the next BTL tax ramp.

A two year slump should ingrain the message and make it self sustaining as we Japanise the UK economy

Thank you Theresa.?

[BearlyBegun]

Awesome news... both rents and house prices falling for the rest of 2019 - excellent!

[2rocketman]

Another 50k - 10% knocked off the price of a house I keep an eye on. 

Think the Brexit extension is great news for us, prices will just continue to decline. Then into another winter, which may even coincide with a recession. 

 

[Spindler]

16 minutes ago, 2rocketman said:

Another 50k - 10% knocked off the price of a house I keep an eye on. 

Think the Brexit extension is great news for us, prices will just continue to decline. Then into another winter, which may even coincide with a recession. 

 

And that's not the final sale price....i smell gazundering further down the line....right before exchange....Ouch !

[“Nasty Piece of work”]

Reductions, Tory EU destruction,  Tory UK crucifixion and a recession too.  Well played Fatty Moron and “Strong and Stable” Theresa.  It’s almost like Vlad put you there.

[Trump Invective]

I'm guessing the RICS "survey" was undertaken before yesterday's 6 month Brexit extension, so Im assuming the falls will be exacerbated. All good

[Spindler]

18 minutes ago, 2rocketman said:

Another 50k - 10% knocked off the price of a house I keep an eye on. 

Think the Brexit extension is great news for us, prices will just continue to decline. Then into another winter, which may even coincide with a recession. 

 

Think you may be on the money (again).....this might be added fuel to the correction.....and it is a needed correction...TPTB in cahoot with the banks have brought the prices from the future into the past and present via every trick they could think of and severely damaged the economy and the social fabric of this country....there are children not being born(cost of raising a family) because of this....all to feed their ponzi scheme....only the feckless or the toffs are knocking them out...how many kids does rees Mogg have ? How many Sharon on Welfare with 6 kids by different fathers......in the middle a wasteland....if you import the difference you just alter the makeup literally of this country until its unrecognisable which it almost is from even the 90's and the noughties

[hayder]

#OffersUnder 

My view is to look at the earliest sold price within the last 30 years for that property.

Add on to it the inflation from here http://inflation.iamkate.com/

Show that to the agent. 

rinse and repeat.

Edited April 11, 2019 by hayder

[Orb]

25 minutes ago, hayder said:

#OffersUnder 

My view is to look at the earliest sold price within the last 30 years.

Add on to it the inflation from here http://inflation.iamkate.com/

Show that to the agent. 

rinse and repeat.

A house I know:

1980 Then house price: £15k... then annual salary of buyer: £5k (3x single wage)

2019 Toady's house value according to your inflation calculator: £72k... so actual wage should be £24k for same job (3x single wage)

Sounds fair and right to me. 

BUT, actual house price now is £220k, and actual wage for that job is now minimum wage: £16k, but with overtime it's around £22k (10x single wage). 

I know there's the argument that interest was a lot higher then, so monthly payments were a lot higher, but I don't see any people moving into that area now who do the same low-skilled job the buyer did in 1980, and NOT with 2 young children. And if there are any, they sure as hell aren't doing it on a single wage alone, like the buyer was in 1980. Something has gone spectacularly wrong. 

Edited April 11, 2019 by Orb

[hurlerontheditch]

1 hour ago, Orb said:

A house I know:

1980 Then house price: £15k... then annual salary of buyer: £5k (3x single wage)

2019 Toady's house value according to your inflation calculator: £72k... so actual wage should be £24k for same job (3x single wage)

Sounds fair and right to me. 

BUT, actual house price now is £220k, and actual wage for that job is now minimum wage: £16k, but with overtime it's around £22k (10x single wage). 

I know there's the argument that interest was a lot higher then, so monthly payments were a lot higher, but I don't see any people moving into that area now who do the same low-skilled job the buyer did in 1980, and NOT with 2 young children. And if there are any, they sure as hell aren't doing it on a single wage alone, like the buyer was in 1980. Something has gone spectacularly wrong. 

there wasn't the same demand for houses then

since then you now have larger population, immigration foreign investors and BTL

 

inflation and HPI are not correlated 

[Peter Hun]

1 hour ago, Orb said:

I know there's the argument that interest was a lot higher then, so monthly payments were a lot higher, but

https://www.mortgagestrategy.co.uk/historical-interest-rates-uk/

In 1980 base rate was falling from 17 to 14%. So a mortage would be ~ 17%

So a buyer in 1980 would look at that 15k house and see it costing 10.5 times that over 15 years. 

 

[Monkey]

55 minutes ago, Peter Hun said:

https://www.mortgagestrategy.co.uk/historical-interest-rates-uk/

In 1980 base rate was falling from 17 to 14%. So a mortage would be ~ 17%

So a buyer in 1980 would look at that 15k house and see it costing 10.5 times that over 15 years. 

 

And today people only care about the monthly payment, and dont care if its IO or repayment, and  are not bothered by 10, 20, 25, 35 years plus mortgages. Plus if they want they can just remortgage and withdraw £x000's from their house to pay for car, holiday, credit cards etc... and not understand that they have probably added 10 years ontop of their mortgage.

Got to keep the plates spinning

Edited April 11, 2019 by Monkey

[thewig]

1 minute ago, Monkey said:

And today people only care about the monthly payment, and dont care if its IO  repayment, and  are not bothered by 10, 20, 25, 35 years plus mortgages. Plus if they want they can just remortgage and withdraw £x000's from their house to pay for car, holiday, credit cards etc... and not understand that they have probably added 10 years ontop of their mortgage.

Got to keep the plates spinning

my pal was getting a mortgage a few years ago and said of his discussion with the mortgage advisor

"I basically said whatever makes the monthly payments the lowest, complete no brainer!!"

I said but yeah you've just added another five ten years to your mortgage or whatever but he was ALL about the monthlies.

 

Semi smart guy too.

 

 

 

[Peter Hun]

11 minutes ago, Monkey said:

And today people only care about the monthly payment, and dont care if its IO or repayment, and  are not bothered by 10, 20, 25, 35 years plus mortgages. Plus if they want they can just remortgage and withdraw £x000's from their house to pay for car, holiday, credit cards etc... and not understand that they have probably added 10 years ontop of their mortgage.

Got to keep the plates spinning

Pretty easy to do when interest rates are so low. But with 10%+ rates 95% of your first years payments are interest.

[ebull]

Annoying that the article / headline is written in a way that suggests or implies: After 6 months prices will restart their never ending march to infinity.

Even more remarkable that it's only as a footnote to that article they mention that another report from DPS saying rents down 240/year national average or 300/year in London. When there's an increase in tax allowances of that sort of amount it's headline news, why is this a footnote to something not related in the short term. To further downplay the amount of the drop it's also reported as 20/month [smallest number available from the stats from DPS].

DPS is reporting post-start-of-contract numbers I guess so it's the equivalent of LR stats for sale prices.

Edited April 11, 2019 by ebull

[dpg50000]

3 hours ago, ebull said:

Annoying that the article / headline is written in a way that suggests or implies: After 6 months prices will restart their never ending march to infinity.

Even more remarkable that it's only as a footnote to that article they mention that another report from DPS saying rents down 240/year national average or 300/year in London. When there's an increase in tax allowances of that sort of amount it's headline news, why is this a footnote to something not related in the short term. To further downplay the amount of the drop it's also reported as 20/month [smallest number available from the stats from DPS].

DPS is reporting post-start-of-contract numbers I guess so it's the equivalent of LR stats for sale prices.

I was just going to comment the same. TPTB are trying their usual tactics now they can no longer cover up the falls, i.e. suggest the downside will be limited and short in duration, in effect trying to put a floor under the panic. If they're suggesting 6 months, it's more likely to be several years.

[longgone]

4 hours ago, thewig said:

my pal was getting a mortgage a few years ago and said of his discussion with the mortgage advisor

"I basically said whatever makes the monthly payments the lowest, complete no brainer!!"

I said but yeah you've just added another five ten years to your mortgage or whatever but he was ALL about the monthlies.

 

Semi smart guy too.

 

 

 

at the tender age of 25 when i took a mortgage out i calculated which provider would leave the least amount of debt owning after 3 years and went for that one.  others were going for the lowest monthly sum as it was cheaper i was told. ? ya ok

[Wayward]

5 hours ago, ebull said:

Annoying that the article / headline is written in a way that suggests or implies: After 6 months prices will restart their never ending march to infinity

Yes it is often framed like that. "Pausing for breath" is a favourite. Message is clear...buy now whilst you can...they need now your life long earnings. 

[TwoWolves]

I've just moved into a new rental. I offered at a 15% discount, even though it was fairly priced and the landlord took my arm off. Nice house too.

The market is not as healthy as it can seem in the press.

 

[neon tetra]

1 hour ago, TwoWolves said:

I've just moved into a new rental. I offered at a 15% discount, even though it was fairly priced and the landlord took my arm off. Nice house too.

The market is not as healthy as it can seem in the press.

 

Can I ask what the numbers were? 425 instead of 500?

[2rocketman]

The flat we are in started off at 1k pcm 18 months ago, we renegotiate every 6 months and keep contracts to a minimum length. Now paying £800 pcm some 20% lower . 

[TwoWolves]

8 hours ago, neon tetra said:

Can I ask what the numbers were? 425 instead of 500?

2,350 -> 2,000