Monday, Jun 19, 2006

Rightmove survey, prices up only 0.8% in May

Firstrung: UK house prices continue microscopic movements, up 0.8% in May - Rightmove

Despite the positive 'push' this is quite a reversal in comparison to the previous set of figures.

Posted by Converted Lurker @ 12:41 AM (577 views)
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10 Comments

1. Dadm said...

This cannot be right......the CML are telling me that house prices will go up 100% every month and the world is flat and Iraqi is a safe place to live.

Perhaps it is a blip this month and is due to the World Cup or 7/7 or similar.

It has nothing, I repeat nothing to do with hidden inflation figures, rising unemployment, increased pressure to raise interest rates, uncontrollable debt escallation, overvalued properties, increased personal insolvencies etc.

I work for a "Big 4" firm of accountants who have prepared a document for each member of staff on the high rates of debt in our economy and the perils of a generation "living on tick".

Monday, June 19, 2006 09:00AM Report Comment
 

2. uncle tom said...

The various indexes are all over the place at the moment - all I know for certain is that house prices have gone nowhere in my neck of the woods (south of Cambridge) for the last couple of years.

The only notable change is the increase in the number of top end properties for sale, and the conspicuous absence of sold signs on them... As Rightmove go on asking price, this may be skewing their data..

Monday, June 19, 2006 09:25AM Report Comment
 

3. tyrellcorporation said...

I saw a nice slightly shabby 1930s house the other day in Exeter which was on for 275k. It looked like someone had snuffed it and I thought I might be able to get a quick sale at around 250k or less. How wrong was I???

The house sold within a week. I phoned the EA and asked him what the score was and he said (and he sounded honest enough) that ten families expressed interest within 3 days and they ended up doing a sealed bid. The property finally went for 'about 320k'. My estimate was also that it needed about 30k spending on it. Sadly (for us) there is still huge pent-up demand and people willing to blow megabucks at houses that quite simply should be going cheap.

Monday, June 19, 2006 10:54AM Report Comment
 

4. denzil said...

tyrellcorp said:
>>The house sold within a week. I phoned the EA and asked him what the score was and he said (and he sounded honest enough) that ten families expressed interest within 3 days and they ended up doing a sealed bid. The property finally went for 'about 320k'. My estimate was also that it needed about 30k spending on it. Sadly (for us) there is still huge pent-up demand and people willing to blow megabucks at houses that quite simply should be going cheap.

Just out of curiosity what did other similar properties in the same street sell for? What I'm seeing is that if a genuinely well-priced property comes on the market then I see people queuing up to buy it.

Monday, June 19, 2006 12:32PM Report Comment
 

5. tyrellcorporation said...

There is a 70's 4 bed just come on at 270k in the same road. The 1930's one was quite original (slatted steel window frames, etc) and obviously the 70's one is not as desirable but the 1930's one was only 3 bed. I think there was a slightly potty frenzy effect about this one.

I think semi-run down properties now represent really bad value for money even in todays climate. People think that they are getting a bargain if something requires updating (this then creates it's own inflationary effect). I honestly think that the reverse is now true. This is also borne out by the fact that I asked the EA if any developers had been interested in the sealed bid or indeed putting in an early offer. He said that the numbers just didn't stack up for an investor/developer to take this property on.

Interesting eh?

Monday, June 19, 2006 01:49PM Report Comment
 

6. talking rot said...

TC

There is, possibly, another explanation. The build quality of 1930s, 1960s and 1970s houses are superior. The quality of buildings in the 1940s and 1950s was effected by war time rationing. In the 1960s, 1970s and part-way into the 1980s, rationing no longer meant poor materials were used but there was a body of highly skilled, affordable tradesmen who took pride in their work.

I rent a modern house - the build quality is appauling and yet Taylor Woodrow claim it is in their executive range. I seriously wonder if my modern Taylor Woodrow home will still be liveable in after 70 years - I think not! The banister was 'glued' on to the wall. All the doors in the upstairs had a single screw holding the hinge to the door frame. The joists have been stapled together. etc. etc. I'd be seriously hacked off had I paid for it. By hey - when things fall off and break, the Landlord gets a 'phone call.

The homes I am looking to buy are typically 1930s semis or 1970 semis. The build quality is far superior. Same I can't afford them though ...

Monday, June 19, 2006 02:51PM Report Comment
 

7. denzil said...

tyrellcorp.
Interesting indeed. I've seen similar behaviour regarding people thinking they are getting a bargain. I looked at a property on the Somerset levels a couple of months back, owner deceased had lived there all her life. The place was like a musuem! It had a guide at auction of 325-375k. There was open house and the property and I had a good chat with the EA and in a round-about kind of way we both came to the decision that 375 was a bit high BUT someone may just fall in love with it. I did some calculations and based on work that needed doing 325 would have been OK, 350K would have made no sense as there was a very similar house 200yds up the road that was for sale at 410 that was in very good order.
I went to the auction and three muppets sat in the front row got into a bidding war and went up to 425K. Bizarre. I think it's programs like "under the hammer" that are affecting peoples judgement.

At the other extreme I went to a an auction which has a property similar to the above, smashed window a complete wreck, guide 250K-325K. It has an orchard that possibly could have been sold to build a house on. I thought the guide was low and an EA trick to bring the punters in. My guess was the max guide price would have been smashed. It actually sold for 225 and had little interest. The chap that bought it has done a great job restoring it and lives there with his wife and kids and puts their pony in the orchard.
I was gutted but did not go to the auction with the intention of buying as I thought it would be well over the odds

Monday, June 19, 2006 03:04PM Report Comment
 

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10. tyrellcorporation said...

Denzil - Doh!, you just can't tell eh!?

On the same subject I'm also seeing more and more half-finished renovations on the market where people have obviously overstretched and under-estimated what was required.
There must be thousands of novice property developers up and down the country who think they can project manage a renovation only to discover it's not quite like on TV where you get an ample chested Beeny telling you where you're going wrong!.

Monday, June 19, 2006 08:28PM Report Comment
 

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