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How Many People Die

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One point often bought up by those arguing that house prices won't fall is that if house prices go down, and people can't get what they want for their houses, they won't sell. That's an over-simplistic argument, as it ignores things such as it being easier for people to move up the so-called ladder when more expensive houses are cheaper and the gap is less. But even if we ignore that, the time when houses really become available is when people living in them die.

I think it's interesting to start working on the numbers for these. As some typical numbers, people get on the property ladder at about 30, and leave it at say 80. That would mean that they'd be occupying houses for about 50 years. So a crude approximation of how many houses become available due to death would be about 1 in 50. There may be more people living together, such as couples, but if we double the number of people, we'll double the number of deaths. On top of that, there are people who move in with their families etc, or downsize to bungalows as the family home is too large. But, I think that the 1 in 50 number is a reasonable approximation.

A medium sized street can easily have 50 houses in it, so we'd expect an average of about one house per medium sized street to become available per year. Using the rightmove "your postcode plus 1/4 mile around" measure as a "neighbourhood", then there would easily be 20-30 medium sized streets in the neighbourhood, or about 1000-1500 houses in a neighbourhood. So, just from death, we'd expect maybe 20-30 houses to come on the market per year due to the owners dying. That's a couple per month.

Getting to the point, I think that's enough of a driver to keep the market ticking over, and houses selling to establish market prices at the margin, even if owners really did decide not to sell when they didn't have to. Put on top of that people relocating, and being repossessed, and there seems to be no reason for there to be a shortage of houses to buy.

As a second question about the number of houses available to be purchased in adverse market conditions, I thought I saw a graph that showed that the number of houses for sale actually went up as the previous crash occurred, and stayed high. Does anyone know where I can find data to confirm if this is in fact the case?

Billy Shears

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  • 301 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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