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lets get it right

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I've been waiting for the crash for so long that, to be honest, whereas in 2004/5 I watched the market like a hawk, over the last year or two I don't pay as much attention. When I do look at the local property rag I generally think 'still nuts then'.

Yesterday I had a good look at the local property rag and was struck by the huge difference in prices between properties that, on the face of it, you'd expect to be about the same price.

The most noticeable price falls appear in (what I consider) to be the top end of the market. Not the real top end, but the top end most people might aspire to. Nice 4 bed, 2 bath detached houses, non-estate, with a third of an acre. At the market peak (which around here was 2003 and then again second half 2006 / first half 2007 - these houses were really beginning to stretch away from the estate houses below them. Prices in the range of 650k to 800k were the norm.

I was surprise to note yesterday that some houses of the type I describe can now be had for 495k. But there are still some on for, say, 700k. The over priced ones now stick out like a sort thumb.

The market seems to be dividing clearly into:

stuff on the market for a long time that is still ludicrously over-priced

houses new to the market (last month or so) that are, by comparison, much cheaper

So the current state of play seems to me to be that EAs are finally getting tough with vendors and forcing them to put their houses on the market at more sensible prices. EAs always bring a list of comparable properties when they come to value your's. I imagine plenty of them are now having chats with their vendors along the lines of 'to be honest we're going to struggle (with the market as it is now) to get 650k for yours - have you seen the property up the road which is on for 495k? No-one is going to pay 650k for yours when there are comparables like that on the market.'

Further down the market there are similar - but not quite so dramatic - differences.

You can find a 3 bed semi a vendor wants to sell for 275k and a 3 bed semi a vendor has no chance of selling for 350k. Even at 275k they are not shifting. I have watched a particular 3 bed semi near me move from 345k to 275k over the last 12/15 months or so. Still not sold.

None of this seems to appear in the statistics but I would say that property that is selling - as opposed to simply being on (and distorting) the market - is now priced at about 20% below the prices that were being asked a year ago.

Is this a crash?

Edited by Lets' get it right

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Nice post - What you're seeing (I'd say) is a split in market-awareness or a split in price reduction timing. I've noticed the same round here - a lot of 'sellers' (kite-flyers really) still hanging on for 07 prices just because it doesn't cost them a thing and the EAs are too scared to challenge them.

I still look at their houses to make them clean it and stay in on a Saturday then tell the EA afterwards that it's a nice house but TOO EXPENSIVE. Ironically, I would buy some of these properties if they were just that, a little cheaper!.

It's not rocket science Estate Agents - do your stuff and get those vendors to drop 'em!

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Nice post - What you're seeing (I'd say) is a split in market-awareness or a split in price reduction timing. I've noticed the same round here - a lot of 'sellers' (kite-flyers really) still hanging on for 07 prices just because it doesn't cost them a thing and the EAs are too scared to challenge them.

I still look at their houses to make them clean it and stay in on a Saturday then tell the EA afterwards that it's a nice house but TOO EXPENSIVE. Ironically, I would buy some of these properties if they were just that, a little cheaper!.

It's not rocket science Estate Agents - do your stuff and get those vendors to drop 'em!

Well, to be precise, according to the IMF, once prices fall 12% from peak we are in crash territory by the strongest sense of the word. By my estimation, we will hit that just in time for christmas!

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Guest KingCharles1st

But don't forget the "greys," or whatever we want to call them.

I.e. People who need/want/ desperate to sell, but now CAN'T because they are already in NEQ so there is no point in even commissioning an EA.

I suppose technically they should not be included in anything as they are not in the process of actually selling/price setting.

But....

Edited by KingCharles1st

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Well, to be precise, according to the IMF, once prices fall 12% from peak we are in crash territory by the strongest sense of the word. By my estimation, we will hit that just in time for christmas!

But the point I was trying to make was that, as always, the indices are, at best, extremely inaccurate and misleading.

In my area houses (that are actually selling) are selling at prices 20% less than was being asked (and presumably got) a year ago. But the indices show just a few percentage point drops. And, on a newspaper page full of property adverts, 19 out of 20 are still at last year's prices. The 1 in 20 that isn't now sticks out like a sore thumb, and sells.

I have never understood how the various indices are calculated. The Land Registry still shows prices rising!

Edited by Lets' get it right

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  • 396 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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