Asking Prices are Still Utterly Insane

[DarkHorseWaits-NoMore]

A couple of weeks old but I found this bit interesting:

...The Halifax house price index surprised analysts when it reported a 0.8pc monthly increase in house prices in March, meaning house prices were down 2pc from their August peak. The monthly change was the exact opposite of the Nationwide index, which reported a 0.8pc monthly drop.

But this divergence likely reflects the fact that buyers are shifting to different types of properties, says Andrew Wishart, senior property economist at Capital Economics. Both indexes are based on mortgage approvals, which means they can only reflect the types of properties each lender’s customers are buying.

“The average size of mortgage approval has fallen by 9pc as households can’t afford to borrow as much at higher mortgage rates. For the Halifax approvals-based index to only report a 2pc fall in prices despite that suggests that the homes being transacted are less valuable, they will be smaller properties and in cheaper areas,” says Wishart.

“A lot of these movers, they’re not aspirational moves, they’re not people pushing for the most expensive property they can buy. They’re far more value-for-money, common sense, good decision moves,” says Donnell.

Higher costs mean a clear differentiation is emerging across the market with buyers flocking to cheaper properties. Sales in the cheapest third of the market were up year-on-year in March in every single region of Britain, according to Zoopla. In the West Midlands and Wales sales growth in this segment was up by 21pc.

The top third of the market is an exact mirror image. Sales in this part of the market fell dramatically in every region, with drops in Scotland and the South East down by 20pc and 12pc respectively. Sales also fell in the middle third of the market in every region except for Scotland and the North East, which recorded only marginal upticks.

“The housing market at the top end has been a bit slower to catch up post-mini-Budget. They have the most money, but equally if they have got the biggest mortgages, they are paying the most interest on it. They need to be more cautious about where the market is going,”...

https://uk.finance.yahoo.com/news/britain-property-market-faces-reckoning-050000777.html

 

 

 

Edited April 23, 2023 by DarkHorseWaits-NoMore

[winkie]

1 hour ago, Sprrite said:

From where I am looking in London, asking prices are still fairly the same but properties are not selling as fast (and some are even coming back on the market).

My only guess right now is that potentially prices are stabilised with longer mortgage periods (30 to 40 year mortgages). I wonder whether we will go the way of Japan where there are 50 year mortgages or even inter-generational mortgages in the future. 

Unless unemployment goes up and/or significant repossessions take place, I can't see the market declining significantly. Right now I just see the marker has plateaued which isn't a bad thing.

Build more homes......to buy and to rent in the places people want to live.......homes for the workers.

Waiting for others misfortune, a loss of job or other financial or health hardship to enable to take a home from them is not charitable....what goes around comes around.

[70PC]

16 hours ago, Nomadd said:

[sexton]

Used to live here in the 60's. Stunned to see the asking price.

Does anyone think this will sell at anywhere near this price?  

https://www.rightmove.co.uk/properties/133977953?sc_id=7086613&onetime_FromEmail=true&cid=7683b670-a49e-48c1-b262-85eb2b7070be&csg=9a280b9397951d5e1d6fd3bf251aa6915d09d11affd23a1b4edc3800f18ca3b9#/?channel=RES_BUY

[winkie]

1 minute ago, sexton said:

Used to live here in the 60's. Stunned to see the asking price.

Does anyone think this will sell at anywhere near this price?  

https://www.rightmove.co.uk/properties/133977953?sc_id=7086613&onetime_FromEmail=true&cid=7683b670-a49e-48c1-b262-85eb2b7070be&csg=9a280b9397951d5e1d6fd3bf251aa6915d09d11affd23a1b4edc3800f18ca3b9#/?channel=RES_BUY

All I can say is there are plenty of rare opportunities like yhat about.....not so rare at all an abundant of nasty brick boxes ..bland and asking silly money......only fools go back for more......slave boxes galore.

[Smith]

35 minutes ago, winkie said:

Build more homes......to buy and to rent in the places people want to live.......homes for the workers.

Waiting for others misfortune, a loss of job or other financial or health hardship to enable to take a home from them is not charitable....what goes around comes around.a

Have you seen much evidence of prices falling in areas where they're building more new homes?

[LetsBuild]

1 hour ago, Sprrite said:

I hope you're right but right now I can't see prices dropping 10-15% unless unemployment goes up or significant repossessions occur . there's still time for this.

The trend towards longer mortgages was already on its way from 2008 and the higher IRs might just accelerate the move. I wouldn't be surprised if we 40-50 year mortgages become the norm. For some people this (against an alternative of renting) might be more suitable.

Let's see where the IRs land as if we are at 5 / 6% at the end of the year, it might just force sellers to lower prices.

What is the average price of the average first time buyer now, low 30’s? How are they going to qualify for a 40/50 year mortgage. Remember life expectancy is going down.

[winkie]

Just now, Smith said:

Have you seen much evidence of prices falling in areas where they're building more new homes?

More on the market for sale but only a matter of time before prices will come down, people who need or want to sell will reduce to sell.... greater supply reduces demand and prices fall back.....

[70PC]

9 minutes ago, Smith said:

Have you seen much evidence of prices falling in areas where they're building more new homes?

Yes, particularly for new homes. Builders are cutting their prices week by week.

[mynamehere]

It's not a hard rule that your mortgage term needs to end before retirement. Some have upper limits of 85 years, some have no upper limit at all. 

I told my bank I was retiring in 10 years and they were still happy to give me a 30 year mortgage based on past income.

 

[winkie]

30 minutes ago, mynamehere said:

It's not a hard rule that your mortgage term needs to end before retirement. Some have upper limits of 85 years, some have no upper limit at all. 

I told my bank I was retiring in 10 years and they were still happy to give me a 30 year mortgage based on past income.

 

Why should they care, it reverts to them whatever if debt not fully paid......the longer the debt the more money made from the borrower.......the less debt outstanding the lower the risk for both lender and borrower...people pay rents till death why not a mortgage.....the bank gets all of its money back eventually, borrower pays interest until debt paid in full.

 

 

 

[Nomadd]

2 hours ago, 70PC said:

🤣 Let us hope so!

[Nomadd]

2 hours ago, sexton said:

Used to live here in the 60's. Stunned to see the asking price.

Does anyone think this will sell at anywhere near this price?  

https://www.rightmove.co.uk/properties/133977953?sc_id=7086613&onetime_FromEmail=true&cid=7683b670-a49e-48c1-b262-85eb2b7070be&csg=9a280b9397951d5e1d6fd3bf251aa6915d09d11affd23a1b4edc3800f18ca3b9#/?channel=RES_BUY

I'm looking in South Manchester. Tons of bungalows in the 700k-900k bracket. Makes me laugh every time I see someone on here and mumsnet say "move North for cheaper housing."

https://www.rightmove.co.uk/properties/131901005#/?channel=RES_BUY

[Fromage Frais]

19 hours ago, Pmax2020 said:

The volume of mediocre houses near me that’ve either sat for months, or are being listed day to day at 400 - 450k is staggering. We’re talking 100 - 150k more than 2019 prices in some instance. 

There’s a nice street near me where houses needing complete overhaul were creeping up to 325 - 350k last year. Today one was listed at 425k. 

Really need to start seeing some big drops in the sold data… 

 

The problem is we are on this forum and if not obsessed nearly all members are logically interested in the property market.

I presume this starts from a feeling that there is something not quite right with the market and its needs to fall or its irrationality is at odds with the fundamentals.

Other folk ... not so much especially the older folk whom actually own most of the houses worth owning.

Their thought process is that let's have a look what the last house sold for..... stick 10/20 percent on there and see how it goes.

The issue is that for my area the deals going through at the moment are from what I have seen mostly (not all) at a lower price than peak.

We however will not see those deals until they hit the land registry.

So you have your meh home on for 600 and the last sold was 550 only this time last year and inflation is 10% you see.

The agent is all bright and breezy telling you it's all great ..... gets the listing and then starts to tell you the market is actually crap.

You wait a few months and then knock off max 10% as you are not giving it away..... and on it sits no way are you going to sell for less than that one next door as you do not have to sell and why if there are no cheaper deals you can see completed with your own eyes.

So what  will happen is eventually three big points.

1). The new lower sales (dont have to be huge reductions just lower) are confirmed in the land registry.....OMG next door sold for 450K!!  .... your 650 listing will look a bit fanciful.

a). Existing homes will clearly look over priced
b) new listings will know what they need to get it shifted

2). The peak prices are in the process of dropping out of the house price indexes another couple of months and we will be there this will show YOY falls and a faster pace of falls.

3). The above will slow things down even more and agents will start to be under pressure some will go under and they may even have a good onboarding sales function but having a disconnect with selling your services without selling the customers property.... will be fatal.

a). They will need money from sales and will get tougher on time wasting sellers.

b). Some vendors do need to sell and will price correctly given they now know the market direction and latest sold prices.

This all takes ages but the second gear is upon us in the next two moneys esp if rates continue to rise.  As soon as we got over 2/3% prices were always going to fall (real at least) just the time to get them down.

I am still firmly holding to 20-30 (pending election fiddling) nominal and full correction real as inflation is so high.


 

[MP1]

11 hours ago, BaldED said:

They wont sell. Simple. If they were they would be sold by now.

This is exactly right. Stock levels are building up slowly, and it only takes one or two sellers to flinch and the whole area will tumble in price.

[mynamehere]

Problem with these breakthrough sales, is the 4 - 6 month lag will take us to October / November before it hits the registry. 

In my corner of Edinburgh exactly half (10 of 20) listings within 1/4 of a mile of me have gone fixed price or have been reduced in the past couple of weeks. These are all sub 500k. There is just one property over 500k for sale, because everything over that level is still selling within a week or so.

Definitely a 2 tier market going on however something seems to be brewing with these 10 out of 20.

 

 

 

[Pmax2020]

2 hours ago, mynamehere said:

Problem with these breakthrough sales, is the 4 - 6 month lag will take us to October / November before it hits the registry. 

In my corner of Edinburgh exactly half (10 of 20) listings within 1/4 of a mile of me have gone fixed price or have been reduced in the past couple of weeks. These are all sub 500k. There is just one property over 500k for sale, because everything over that level is still selling within a week or so.

Definitely a 2 tier market going on however something seems to be brewing with these 10 out of 20.

 

 

 

4 years ago this would’ve been 300-320k. Last year probably 380k amidst the cheap rates. However it was listed last week at 430k!!!!! 

https://www.rightmove.co.uk/properties/133922582#/?channel=RES_BUY

Inverkeithing has a decent high school but the place is a bit of a dive and there’s literally nothing there…

[mynamehere]

11 hours ago, Pmax2020 said:

4 years ago this would’ve been 300-320k. Last year probably 380k amidst the cheap rates. However it was listed last week at 430k!!!!! 

https://www.rightmove.co.uk/properties/133922582#/?channel=RES_BUY

Inverkeithing has a decent high school but the place is a bit of a dive and there’s literally nothing there…

It's a 20 minute drive to the west end from there, (if the bridge is clear...) so that's likely to be of interest to a commuter who doesn't need local amenities.

Nice views. Rare to find a house under 500k that's over 2000ft so close to edinburgh. This undersupply has worsened since 4 years ago so short of a bomb hitting the bridge I don't think you will  see those nominal prices again.

Will be interesting to see if it hangs around, but suspect it will go for 500+

I thought you were looking further north? queensferry is firmly caught in the edinburgh bubble

Edited April 24, 2023 by mynamehere

[wighty]

11 hours ago, Pmax2020 said:

4 years ago this would’ve been 300-320k. Last year probably 380k amidst the cheap rates. However it was listed last week at 430k!!!!! 

https://www.rightmove.co.uk/properties/133922582#/?channel=RES_BUY

Inverkeithing has a decent high school but the place is a bit of a dive and there’s literally nothing there…

They don't build them like that anymore.

[wighty]

29 minutes ago, mynamehere said:

It's a 20 minute drive to the west end from there, (if the bridge is clear...) so that's likely to be of interest to a commuter who doesn't need local amenities.

Nice views. Rare to find a house under 500k that's over 2000ft so close to edinburgh. This undersupply has worsened since 4 years ago so short of a bomb hitting the bridge I don't think you will  see those nominal prices again.

Will be interesting to see if it hangs around, but suspect it will go for 500+

I thought you were looking further north? queensferry is firmly caught in the edinburgh bubble

Few years ago was offered job in Edinburgh. Got put off by house prices and the offers over system.

Much better value over bridge but commute too dodgy for me.

Then came COVID and WFH. Oh well!.

Lovely place Edinburgh.

 

[Pmax2020]

51 minutes ago, mynamehere said:

It's a 20 minute drive to the west end from there, (if the bridge is clear...) so that's likely to be of interest to a commuter who doesn't need local amenities.

Nice views. Rare to find a house under 500k that's over 2000ft so close to edinburgh. This undersupply has worsened since 4 years ago so short of a bomb hitting the bridge I don't think you will  see those nominal prices again.

Will be interesting to see if it hangs around, but suspect it will go for 500+

I thought you were looking further north? queensferry is firmly caught in the edinburgh bubble

I do like Kinross-shire but work for me these days is almost wholly remote and that’s unlikely to change. 

My search area is there huge and could be anywhere between Glasgow and Edinburgh, as far north as Perth, Stirlingshire in the North West, and northern areas of the Scottish borders. Or a simpler way to describe it is a 30-45 min radius of the forth bridges. 
 

I just want a decent sized place/plot, rural, and with good schools. Which isn’t too difficult in Scotland. 

 

[mynamehere]

4 minutes ago, Pmax2020 said:

I do like Kinross-shire but work for me these days is almost wholly remote and that’s unlikely to change. 

My search area is there huge and could be anywhere between Glasgow and Edinburgh, as far north as Perth, Stirlingshire in the North West, and northern areas of the Scottish borders. Or a simpler way to describe it is a 30-45 min radius of the forth bridges. 
 

I just want a decent sized place/plot, rural, and with good schools. Which isn’t too difficult in Scotland. 

 

It's not difficult to find that for 350-400k, so what's stopping you?

 

Edited April 24, 2023 by mynamehere

[ABZ_RVK]

On 22/04/2023 at 22:50, Pmax2020 said:

The volume of mediocre houses near me that’ve either sat for months, or are being listed day to day at 400 - 450k is staggering. We’re talking 100 - 150k more than 2019 prices in some instance. 

There’s a nice street near me where houses needing complete overhaul were creeping up to 325 - 350k last year. Today one was listed at 425k. 

Really need to start seeing some big drops in the sold data… 

 

Prices in Wokingham are still around 2022 peaks. 3 bedroom house asking price in some areas is around 700K

Sellers are adamant and happy to sit till they find a buyer for their asking price. 

[wighty]

Had to laugh twice at this one.

First at last picture then at last price sold.

https://www.rightmove.co.uk/properties/134022836?utm_campaign=property-details&utm_content=buying&utm_medium=sharing&utm_source=copytoclipboard#/&channel=RES_BUY

Edited April 24, 2023 by wighty

[70PC]

1 hour ago, ABZ_RVK said:

Prices in Wokingham are still around 2022 peaks. 3 bedroom house asking price in some areas is around 700K

Sellers are adamant and happy to sit till they find a buyer for their asking price. 

These are asking prices and although sellers may be willing to sit it out, this is a market destined to continue falling for obvious reasons. Happy is not the right choice of word.