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Realistbear

Guardian: Nottingham Homes Down 13%

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http://money.guardian.co.uk/houseprices/st...1814787,00.html

Nottingham outlaws are robbing the 'hood

Hans Kundnani

Friday July 7, 2006

The Guardian

These days in Nottingham it's no fun being an estate agent. "You only have to drive around Nottingham to see for yourself how many For Sale boards there are," said Barbara Palmer, an estate agent at Spencer Birch.
According to the Nationwide figures published yesterday, house prices there have plumeted by 13% in the past 12 months, the steepest decline in the country. Nottingham has also been awarded the title of crime and gun capital of Britain, which is unlikely to be a coincidence.
Sitting in an empty office and pointing at a wall full of unsold property listings, Ms Palmer said she was working harder than a year ago. "Nothing seems to be moving at all," she said. "We're getting a lot of offers below the asking price. It's a bit of a dire situation."
Estate agents in Nottingham agree that there is a glut of property in the student market.
Many people have bought properties to let to students, but more recently a large number of purpose-built apartments have come on the market. As a result, many house owners are selling - or at least trying to. "A lot are standing empty," Ms Palmer said.
Over the past 10 years, according to Nationwide,
house prices in Nottingham have risen by 168%
. In particular, the local market boomed in 2004 before slowing down dramatically, according to Mark Philpot of Nottingham Property Services, an estate agent with 19 branches in Nottinghamshire and Lincolnshire. Estate agents say house owners' ideas of what their properties were worth became inflated. "It has to be competitively priced now," said Annabel Young of Thomas James. "People can't pick and choose the house prices they want any more."

The crash in Nottingham is spreading to the West Midlands as my area is in great HPC shape also with so many houses advertising "new prices" and "no upward chain." Keep smiling we are on the way folks! :)

Edited by Realistbear

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I started a new job in Nottingham a couple of months ago and am renting one of the new build flats in the town centre in the Lace market area. Apparently my landlord paid £150,000 for this flat new in October and I was the first person to move in with a rent of £400 pcm (according to the Estate Agent he wanted £650 a few months ago but no takers). There's a fair few to let signs around this area and they are still building huge blocks of new flats. Makes you wonder doesn't it?

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I started a new job in Nottingham a couple of months ago and am renting one of the new build flats in the town centre in the Lace market area. Apparently my landlord paid £150,000 for this flat new in October and I was the first person to move in with a rent of £400 pcm (according to the Estate Agent he wanted £650 a few months ago but no takers). There's a fair few to let signs around this area and they are still building huge blocks of new flats. Makes you wonder doesn't it?

Expecting a reasonable 10% gross yield, on that income the place would be worth about £48k.

That doesn't sound unreasonable for a 2 bed city centre flat.

Oh well, he only paid 100 grand too much...

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Expecting a reasonable 10% gross yield, on that income the place would be worth about £48k.

That doesn't sound unreasonable for a 2 bed city centre flat.

Oh well, he only paid 100 grand too much...

That might be true but it's actually only a one bedroom place. To be fair it is actually a reasonably nice flat, but the walls are like paper. When the flat next to me decides to play music late at night then I don't end up getting much sleep. God knows what it would be like if they reopened the bar that is at the front of the building.

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Estate agents in Nottingham agree that there is a glut of property in the student market. Many people have bought properties to let to students, but more recently a large number of purpose-built apartments have come on the market. As a result, many house owners are selling - or at least trying to. "A lot are standing empty," Ms Palmer said.

This could also be connected with your other post today, describing the new regulations (enforceable 06/07/06) for HMOs (Houses of Multiple Occupation).

I remember TTRTR returning from an LLs meeting held by ARLA or similar a twelve month or more ago where one LL of HMOs was telling him he was getting out of that sector because of the burdensome costs. Clearly there are many LLs who aren't as switched on as TTRTR or his mate. Then again, few LLs bother to come here and talk to we crazies.....

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Although Im generally bullish Ive always said new flats have been falling in price since about Spring 2004.

2 lads at my martial arts club this week declared they are getting into new - build B2L :o

They have absolutley no concept of comparative yields etc. All they say is 'its a pension' :rolleyes:

Block after block of new builds going up here and still the newbie B2Ls queue up.

I see scores of such people over on moneysavingexpert.

I cant beleive a mass exodus from newbuild has not occured yet. Its a ticking bomb.

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It's weird.... comparing new build flats with new cars...

Car rental agencies tend to always buy new cars and rent them out.

Everyone knows that a new car loses a certain percentage of its value the moment it's driven off the forecourt. I'd imagined that rental companies lease the cars but in any event have this depreciation worked into their business model.

Clearly everyone knows that with a very few exceptions, all cars continually always fall in value over time as they get older, whereas property has tended to increase slightly in value against inflation over the longer term in the past (though I personally am not convinced this will continue)

The bit nobody seems to think of is that the new build suffers the same type of loss immediately, this in part due to the artificially inflated original asking price - there are 2 bedroom new build flats in Blackpool for 250k (it would be cheaper to move down south!). There are also lovely 4 or 5 bed detached houses in prestigous parts of Blackpool (there really are some) for the same money or just a little more.

The fact that anyone ever believed that a 2 bed flat in Blackpool, even with a sea view (and few have), could ever be worth circa 250k is shocking ignorance. Yet just down the road there are flats "from 335k". Very little "conventional" property in Blackpool is worth that much. The degree of "overpricing" is amazing made even more so by the fact that some people who would call themselves "investors" have indeed fallen for it.

Average salary 14.5k. Two bed flat 250k. Five bed detached 250k. I wonder which one will drop in value fastest...

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Guest Bart of Darkness
o be fair it is actually a reasonably nice flat, but the walls are like paper. When the flat next to me decides to play music late at night then I don't end up getting much sleep.

Be thankful to be only renting that place.

Had I paid that much for a flat, this is not what I would want to have to go through on a regular or semi-regular basis.

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That might be true but it's actually only a one bedroom place. To be fair it is actually a reasonably nice flat, but the walls are like paper. When the flat next to me decides to play music late at night then I don't end up getting much sleep. God knows what it would be like if they reopened the bar that is at the front of the building.

It's not the Hicking building is it? An agent expected me to pay £800PCM for a place there, I didn't even look inside once I saw it was over a Hooters bar and was next to a busy junction and the railway.

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It's weird.... comparing new build flats with new cars...

Car rental agencies tend to always buy new cars and rent them out.

Everyone knows that a new car loses a certain percentage of its value the moment it's driven off the forecourt. I'd imagined that rental companies lease the cars but in any event have this depreciation worked into their business model.

There are also taxation (VAT) reasons behing their business model which make the impact of depreciation less than the headline figures.

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I know a car rental firm owner - he can buy fleets of cars with a one year warranty very cheaply - well below forecourt price. He rents them out for a year then sells them on, making money both ways.

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"People can't pick and choose the house prices they want any more."

What a strange concept - pick and choose the house price they want. People always pick the highest price they think they can get away with for a sale, and the lowest they think they can get away with for a buy. Why would anyone ever do anything else. What I think she's really saying, but can't bring herself to is "people have to accept less for a sale".

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Two things I don't understand here - firstly the inference that because flats are being built, home owners are selling : why the dickens would anyone want to move from owning a house to owning a flat? I like the idea of not having anyone living above or below me and being able to have a garden. (Even if I don't like doing the gardening).

Secondly, I can't see why anyone wouldn't look at the simple economics of the B2L market. For it to work you've got to be able to charge more renting than it cost to buy. The reason a lot of people are renting is because they can't afford overinflated houseprices. The only people making money out of the B2L market have mortgages on based house prices bought at least 8 or 9 years ago.

A B2L property can only be a pension if it yields an increased value over total investment costs and the RPI increases : whilst in the short terms this has happened, there is no guarantee there is any future for this. After all, I think at some point it's unlikely someone will want to pay £X,000,000 for a two bed flat.

Then again, house prices have always risen. The deeds on our house prohibit anyone building anything on the property of a value less than £175. (Though that was in 1885).

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LR figures on Home.co.uk tend to suggest otherwise

See: http://www.home.co.uk/guides/house_prices_...&lastyear=1 :huh:

Nationwide figures tend to suffer from having too small a sample size.

Cool your boots. IMO the stagnation will continue for some time then in 2007 things will get interesting.

Look at the May RICS survey - East and West midlands markets not in good shape - more prices going down than going up.

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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% +
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      • Even
      • up 2.5%
      • up 5%



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