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headmelter
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I suppose one theory that could explain a slowdown without an actual crash is where the balance of home ownership now shifts to a different and smaller subset of the population and that renting, rather than buying, becomes the norm for most people.

Isn't this the situation on the continent, where renting is much cheaper than buying and it makes more financial sense to rent?

The major difference is that on the continent there are good tenancy laws which give security of tenure. In the UK the laws seem to have been changed to purposely encourage speculation - it is easy to get rid of a tenant and sell the property here. This was a major barrier to landlords in the past, and explains why rental returns were so much higher in the past.

However, when a property is yielding less than 3% net (see my thread on the main discussion board) there has been a definite overshoot and something has to give.

Great to have you guys here providing on the ground info about what is probably the must overheated market in the world right now!

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Yup, right on the mark. However (I am always looking counter arguements, I am not meaning to seem rude!) much of the property on the continent is let out by an individual who owns it or is at least close. Here, a good lot of property is heavily mortgaged. To have the lower rents the owner would have to subsidise the mortgage enormously in many cases which means that BTL would become rather unprofitable...

That's exactly what I was thinking. The BTL newbys will have borrowed at say, 5% or whatever it is to get a return of, 8% maybe,due to capital appreciation, plus a rental yield which in Belfast anyway is probably pretty low, and that's not including repairs, insurance, void periods and generally a lot more hassle than a straightforward investment. And capital gains tax if they sell.

Of course people could have made money, but the key to that would have been getting in and getting out at the right time. If they are still in it when the market cools, and I say cools, not even crashes, they could soon realise they aren't so well off after all.

But how do you know that a good lot of property is heavily mortgaged? I'd assume it is too, but I don't actually know that.

I've tried talking to a few people about it, trying to understand how their sums add up. But I get the feeling it's as pointless as talking aobut religion - people believe what they wan't to, and just aren't interested in facts!

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But how do you know that a good lot of property is heavily mortgaged? I'd assume it is too, but I don't actually know that.

I was going to cite the nationwide figures which showed 44% growth last year, but it occurs that this is not solely mortgages. So I guess the comment is little more than a reasoned assumption. The only thing i really have is anecdotal. I find it hard to believe that in a relatively average part of the country, people have enough cash to be purchasing outright. There cant be many people with £150k spare...

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I was going to cite the nationwide figures which showed 44% growth last year, but it occurs that this is not solely mortgages. So I guess the comment is little more than a reasoned assumption. The only thing i really have is anecdotal. I find it hard to believe that in a relatively average part of the country, people have enough cash to be purchasing outright. There cant be many people with £150k spare...

It amazes me that the banks have allowed this kind of borrowing.

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Guest donall

I read in the Derry Journal over Xmas that lenders were changing from lending based on earnings to lending based on outgoings and other measures.

With prices as ridiculous as they are in NI and salaries lower than the UK (while house prices are lower on average as ours based on nationwide figures) as a whole I can't see how people will be able to afford to keep up mortgage payments.

If anyone is more eager to buy now then they need their head examined - they have missed the boat already.

----

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I have some concerns whether the prices we see reported in the press are the real prices. It seems to me that asking prices have risen by a huge amount lately, but the selling prices are astronomically above this. I could strictly make it to 180k. On the face of it, I should be able to get something reasonably nice. However the reality is that looking at a property with asking more than 130k is totally pointless. Here are a few examples of 'way above asking'.

http://www.templetonrobinson.co.uk/brochur...mp;c=30&r=1

Asking £195k, current offer £252k

http://www.templetonrobinson.co.uk/brochur...mp;c=30&r=1

Asking £175k, current offer £240k (note that this place looks nice, but it is in a rough protestant estate - i.e. catholics need not apply)

http://www.templetonrobinson.co.uk/brochur...mp;c=30&r=1

Asking £165k, current offer £216k

Unfortunately there are very few places which list offers so it is hard to chart this. Anothing note that you might make is that most of the ridiculous 'over asking' offers are on 'lower end' property. Once you get towards £250k, it seems much more sensible.

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talksalot - just a small anecdotal for you

I was out at the weekend with some mates and one of the fellas said he was looking to get a bigger house, I questioned his timing etc. and said that IMHO house prices in NI can only really go one way this year, the reply from him and another mate was that they did not believe prices would go down just 'slow down' and maybe plateau.

Anyways this got me thinking that this probably reflects 'the man on the streets' atitude to HPs in NI; but can this market possibly just plateau after such astronomical rises compared to the rest of the UK - I think not.

IMO. the only possible way that HPs in NI can be sustained at current levels is if there is something major that we are all missing eg. that NI is the place that everyone wants to move to at the expense of other places or wages here are set to increase by 30%+; as there is no evidence to support this I revert back to my down, down and down hypothesis!

http://www.templetonrobinson.co.uk/brochur...mp;c=30&r=1

Asking £195k, current offer £252k

2 bedrooms!!! - have people gone stark raving bonkers!!!!!!!!

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That is the current norm I am afraid. I think all too many people who are not paying attention will look at the advertised (asking prices) and nonsense those of us complaining. But when the reality is that you wont get a house if you cant pay several 10's of thousands above asking, I think the interpretation is skewed dramatically.

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there's maybe more negative sentiment out there than I figured..................

http://u.tv/newsroom/comments.asp?id=78363...;ps=1&o=ASC

from posts....

"I am in the process of selling the properties I invested in several years ago while the going is good. And just out of interest - they are all empty, with very little interest from potential tenants."

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there's maybe more negative sentiment out there than I figured..................

http://u.tv/newsroom/comments.asp?id=78363...;ps=1&o=ASC

from posts....

"I am in the process of selling the properties I invested in several years ago while the going is good. And just out of interest - they are all empty, with very little interest from potential tenants."

I readn those comments and what surprised me most was how low the quoted salaries were. Just where is all this money coming from?

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Most serious investors should be alright as the majority of these will have bought 3-4 years ago, therefore a 50% or more drop would be needed to affect them. However the peak of the market may encourage these individuals to offload in order to realise their 'profits'.

Interesting times ahead... the clock is ticking........Tick Tock!!

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Most serious investors should be alright as the majority of these will have bought 3-4 years ago, therefore a 50% or more drop would be needed to affect them. However the peak of the market may encourage these individuals to offload in order to realise their 'profits'.

Interesting times ahead... the clock is ticking........Tick Tock!!

That may well be true, but 3 or 4 years ago the market was barely moving. This implies to me that such serious investors must be in the minority....

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That may well be true, but 3 or 4 years ago the market was barely moving. This implies to me that such serious investors must be in the minority....

I moved over in 2002 and in my mind they have been going up ever since but I thought I would just look at the figures to see the % yoy changes using historical data i.e.

http://www.nationwide.co.uk/hpi/default.asp

2005 4th quarter to 2006 4th Quarter = +44.15%

2004 4th quarter to 2005 4th Quarter = +13.22%

2003 4th quarter to 2004 4th Quarter = +17.97%

2002 4th quarter to 2003 4th Quarter = +10.25%

2001 4th quarter to 2002 4th Quarter = +15.73%

2000 4th quarter to 2001 4th Quarter = +3.45%

In conclusion, whilst the last year is unprecedented, the yoy growth has been in double digit figures since 2001

PS - Congrats Headmelter on your new arrival :rolleyes:

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Guest donall

looking at those YOY increases you have to remember that a 10% rise in prices is not the same as a 10% increase in prices 4 years ago.

If you compound the YOY increases for the last 6 yearshat you list there you'll find that prices rose in absolute terms more in the last year than they did in the 5 previous years.

Just wanted to point that out

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I have some concerns whether the prices we see reported in the press are the real prices. It seems to me that asking prices have risen by a huge amount lately, but the selling prices are astronomically above this. I could strictly make it to 180k. On the face of it, I should be able to get something reasonably nice. However the reality is that looking at a property with asking more than 130k is totally pointless. Here are a few examples of 'way above asking'.

http://www.templetonrobinson.co.uk/brochur...mp;c=30&r=1

Asking £195k, current offer £252k

http://www.templetonrobinson.co.uk/brochur...mp;c=30&r=1

Asking £175k, current offer £240k (note that this place looks nice, but it is in a rough protestant estate - i.e. catholics need not apply)

http://www.templetonrobinson.co.uk/brochur...mp;c=30&r=1

Asking £165k, current offer £216k

Unfortunately there are very few places which list offers so it is hard to chart this. Anothing note that you might make is that most of the ridiculous 'over asking' offers are on 'lower end' property. Once you get towards £250k, it seems much more sensible.

Hi there,

is there any way to know how much properties displayed as "sold" on the Templeton Robinson website actually sold for?

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Hi there,

is there any way to know how much properties displayed as "sold" on the Templeton Robinson website actually sold for?

Unfortunately there is no way I know off. The EAs dont do it for legal reasons and I have found no other sites which do it for NI.

All_prop.pdf

This graph shows prices in both NI and the UK as a whole. The data is simply raw numbers and I have not done any inflationary adjustment. The most interesting point is the last property crash - you can clearly see it simply did not happen in NI. In fact one would be entirely correct in stating that, within this data set, NI prices indeed never have gone down.

I really wonder whether this is adding to our problem because it would be correct to say that people in NI have never experienced anything but growth.

Another interesting feature... in the last 15 years, prices in NI have increased by something between 600-700%!!!!

All_prop.pdf

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Unfortunately there is no way I know off. The EAs dont do it for legal reasons and I have found no other sites which do it for NI.

All_prop.pdf

This graph shows prices in both NI and the UK as a whole. The data is simply raw numbers and I have not done any inflationary adjustment. The most interesting point is the last property crash - you can clearly see it simply did not happen in NI. In fact one would be entirely correct in stating that, within this data set, NI prices indeed never have gone down.

I really wonder whether this is adding to our problem because it would be correct to say that people in NI have never experienced anything but growth.

Another interesting feature... in the last 15 years, prices in NI have increased by something between 600-700%!!!!

Yes, I've looked at graphs on NI prices before and noticed that there was no crash (because there was no boom either, I suppose, due to political circumstances). I think you are right - there is no psychological brake on housebuyers activities as prices only ever go up (in the case of NI, that statement is actually true and therefore much greater weight is attached).

I tried to PM you, talksalot81, but you don't have the facility enabled. If you ask the moderators they will enable it for you.

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Yes, I've looked at graphs on NI prices before and noticed that there was no crash (because there was no boom either, I suppose, due to political circumstances). I think you are right - there is no psychological brake on housebuyers activities as prices only ever go up (in the case of NI, that statement is actually true and therefore much greater weight is attached).

lets hope that finances put the brakes on things a bit

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Yes, I've looked at graphs on NI prices before and noticed that there was no crash (because there was no boom either, I suppose, due to political circumstances). I think you are right - there is no psychological brake on housebuyers activities as prices only ever go up (in the case of NI, that statement is actually true and therefore much greater weight is attached).

I tried to PM you, talksalot81, but you don't have the facility enabled. If you ask the moderators they will enable it for you.

I have asked in the dedicated forum... until now i didnt even know I couldnt do PMs!

Another note is that in the whole range, NI has been more expensive than the UK average for only a tiny length of time in the late 70s and the last few months...

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I have asked in the dedicated forum... until now i didnt even know I couldnt do PMs!

Another note is that in the whole range, NI has been more expensive than the UK average for only a tiny length of time in the late 70s and the last few months...

is there anywhere that I can see average salaries according to region for the UK and Ireland?

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I'm not sure if I'm right but is the new rates system not based on the 'value' of your house?

If this is the case where is this data going to come from? and will it be available to the general public? <_<

P.S Thanks prophet-profit, hope to see you soon.

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is there anywhere that I can see average salaries according to region for the UK and Ireland?

I would rather like that too... most particularly historic so that I can factor it into my analysis.

You can look at http://www.detini.gov.uk/cgi-bin/downdoc?id=2535

It is only recent but has a few useful figures.

If you look at the annual earnings section you find that in 2006, the median NI wage was 20963, some 11.1% lower than the cited UK median of 23580. Have a look then at section 8. Considering the whole workforce, NI weekly earnings are third from lowest and only £6 per week more than the bottom. If you look at males alone you find that NI wages are the lowest in the country by a long way (£20 a week). Interestingly women in NI seem to do really very well, much better than elsewhere in the UK and this goes a way to pulling the combined tally from being the bottom of the table. Yet another interesting note can be made by looking at the breakdown of salaries - it is amazing how much more the public sector guys are getting than the rest of us! In fact NI public are earning more than UK public!

So role all that in and NI is basically on a par with the lowest earning regions in the UK.

Edited by talksalot81
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