| Anecdotal evidence that the housing market is getting a pasting 13:36 - Nov 4 with 3952 views | giant_stow |
Some may remember my neighbour Dave who insulted me with the kindness of washing my windows for free to help sell his house?
Well some weeks later, he's had to reduce the price by 50 grand - saw him today and he says that he's had one viewing in this whole time its been on the market, despite the price drop.
If that's happening everywhere, we're looking at the big one I reckon. Terrible news for people who've just bought with little equity - great news for non-home owners. |  |
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| Anecdotal evidence that the housing market is getting a pasting on 13:45 - Nov 4 with 3901 views | StokieBlue |
Sounds like he may have been a bit bullish on the price there if he's only had one viewing (given you said this "whole time" which implies a decent amount of time).
SB |  |
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| Anecdotal evidence that the housing market is getting a pasting on 13:54 - Nov 4 with 3852 views | giant_stow |
| Anecdotal evidence that the housing market is getting a pasting on 13:45 - Nov 4 by StokieBlue |
Sounds like he may have been a bit bullish on the price there if he's only had one viewing (given you said this "whole time" which implies a decent amount of time).
SB |
It must have been on the market for about 5 or 6 weeks I reckon, but not sure when he reduced it. TBh, I'm a rightmove nerd and his starting price seemed ok-ish for pre Truss times at least. | |
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| Anecdotal evidence that the housing market is getting a pasting on 13:55 - Nov 4 with 3846 views | clive_baker |
Going to be a challenging couple of years, which will see transaction levels drop off a lot IMO. I think that's already started and been accelerated since the mini budget. The market was due a correction though, and even a 15% drop only takes us back to Q1 of 2021 prices which shows how ridiculous the last couple of years has been.
Of course drops in house prices are a holding loss for a lot of people, if they can still afford to pay the repayments then it's perhaps less of an issue as long as they come back before the need or want to sell up or remortgage. There will undoubtedly been people who bought over the past year with skinny deposits that might be in a little bother though.
You say great news for non home owners, maybe if they have a deposit and want to buy over the next year or 2 and can time it right. It's probably not good news for renters who wanted to save. |  |
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| Anecdotal evidence that the housing market is getting a pasting on 13:58 - Nov 4 with 3814 views | giant_stow |
| Anecdotal evidence that the housing market is getting a pasting on 13:55 - Nov 4 by clive_baker |
Going to be a challenging couple of years, which will see transaction levels drop off a lot IMO. I think that's already started and been accelerated since the mini budget. The market was due a correction though, and even a 15% drop only takes us back to Q1 of 2021 prices which shows how ridiculous the last couple of years has been.
Of course drops in house prices are a holding loss for a lot of people, if they can still afford to pay the repayments then it's perhaps less of an issue as long as they come back before the need or want to sell up or remortgage. There will undoubtedly been people who bought over the past year with skinny deposits that might be in a little bother though.
You say great news for non home owners, maybe if they have a deposit and want to buy over the next year or 2 and can time it right. It's probably not good news for renters who wanted to save. |
yes, fair point at the end there. | |
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| Anecdotal evidence that the housing market is getting a pasting on 14:02 - Nov 4 with 3794 views | baxterbasics |
Radio expert' yesterday predicted 5-10% drops in the short/med term. There will always be limits to any crash because demand outstrips supply, and it will remain thus until someone actually sets about building more houses. Neither government or construction industry seems prepared to do so. |  |
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| Anecdotal evidence that the housing market is getting a pasting on 14:08 - Nov 4 with 3780 views | giant_stow |
| Anecdotal evidence that the housing market is getting a pasting on 14:02 - Nov 4 by baxterbasics |
Radio expert' yesterday predicted 5-10% drops in the short/med term. There will always be limits to any crash because demand outstrips supply, and it will remain thus until someone actually sets about building more houses. Neither government or construction industry seems prepared to do so. |
I get your argument there about a natural floor to prices, resulting from demand, but then again, I wonder on an individual level, who would be buying right now or in the immediate year or two for that matter?
I can see lots of people wanting to sell, but you'd either have to be desperate or wealthy to buy a place with a large mortgage (at least) right now. Or fallen for the place you want to buy I spose. Can't see many buy to letters fancying it either. | |
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| Anecdotal evidence that the housing market is getting a pasting on 14:22 - Nov 4 with 3729 views | ronnyd |
| Anecdotal evidence that the housing market is getting a pasting on 13:54 - Nov 4 by giant_stow |
It must have been on the market for about 5 or 6 weeks I reckon, but not sure when he reduced it. TBh, I'm a rightmove nerd and his starting price seemed ok-ish for pre Truss times at least. |
Six weeks? Soon will be time for him to do your windows again. Just in case a prospective buyer turns up. |  | | |
| Anecdotal evidence that the housing market is getting a pasting on 14:35 - Nov 4 with 3694 views | NthQldITFC |
I reckon it's your horrible yellow and green curtains that are putting off Dave's potential buyers.
Serves him right for cleaning all the grime off yer windows.
Sorry.  |  |
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| Anecdotal evidence that the housing market is getting a pasting on 14:39 - Nov 4 with 3685 views | geg1992 |
I'm looking at houses between 200-300k and the price drops already have been significant.
I saw once house go from 240k to 195k in 2 months.
Others are being listed at more than 10% lower than previously for the same kind of house, location etc.
However, I think some of this may be due to people being a bit too optimistic.
I'm patiently waiting to see what unfolds. |  |
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| Anecdotal evidence that the housing market is getting a pasting on 15:04 - Nov 4 with 3610 views | hype313 |
If he had to drop it by £50k, something tells me his agent is a shark, not Foxtons by any chance is it?
Get the listing by any means, and then give some BS excuse why they have to drop it at the realistic market rate. |  |
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| Anecdotal evidence that the housing market is getting a pasting on 15:25 - Nov 4 with 3563 views | HARRY10 |
| Anecdotal evidence that the housing market is getting a pasting on 14:08 - Nov 4 by giant_stow |
I get your argument there about a natural floor to prices, resulting from demand, but then again, I wonder on an individual level, who would be buying right now or in the immediate year or two for that matter?
I can see lots of people wanting to sell, but you'd either have to be desperate or wealthy to buy a place with a large mortgage (at least) right now. Or fallen for the place you want to buy I spose. Can't see many buy to letters fancying it either. |
The flaw there is that demand is not static and is dependent upon a number of variables.
With mortgage rates increasing the amount affordable decreases - which has a downward effect on prices rather than on sales. However, there will be a sense of sitting on their hands as far as buyers go. Why buy now when it will most likely be cheaper later on., will be the thought.
What hit hard in the early 1990s was the combination of rising rates and job losses.
Anyone can sit out negative equity if they can still pay the mortgage. However for those struggling they may wonder if it is worth keeping the mortgage if there is no likelihood of the house price rising to what they paid for it. That was what caused so many to 'walk away'.... leading to a further house price drop as the market had more for sale than there was demand.
A one or two percent rise is not the same percentage increase on a 9% interest rate as it is on O.25% rate. ie the percentage increase will be higher this time.
And as energy bills eat into household income it will be cutting down to only the basics. A case of buy what you have to, not what you would like to. Expect closures in many of these areas.
When the Chancellor is saying 'expect hard times' expect hard times. This will come as quite a shock for those having lived with cheap money for the past couple of decades. | | | |
| Anecdotal evidence that the housing market is getting a pasting on 18:31 - Nov 4 with 3429 views | HARRY10 |
| Anecdotal evidence that the housing market is getting a pasting on 15:25 - Nov 4 by HARRY10 |
The flaw there is that demand is not static and is dependent upon a number of variables.
With mortgage rates increasing the amount affordable decreases - which has a downward effect on prices rather than on sales. However, there will be a sense of sitting on their hands as far as buyers go. Why buy now when it will most likely be cheaper later on., will be the thought.
What hit hard in the early 1990s was the combination of rising rates and job losses.
Anyone can sit out negative equity if they can still pay the mortgage. However for those struggling they may wonder if it is worth keeping the mortgage if there is no likelihood of the house price rising to what they paid for it. That was what caused so many to 'walk away'.... leading to a further house price drop as the market had more for sale than there was demand.
A one or two percent rise is not the same percentage increase on a 9% interest rate as it is on O.25% rate. ie the percentage increase will be higher this time.
And as energy bills eat into household income it will be cutting down to only the basics. A case of buy what you have to, not what you would like to. Expect closures in many of these areas.
When the Chancellor is saying 'expect hard times' expect hard times. This will come as quite a shock for those having lived with cheap money for the past couple of decades. |
6 hours ago By Jonathan PrynnBusiness Editor
"Demand for homes in London has almost halved since the disastrous mini-Budget as thousands of panicked buyers scrap plans to purchase properties.
Latest data from property portal Zoopla shows a 45 per cent fall in the number of people making direct enquiries with estate agents, seen as an accurate measure of activity in the market. The fall is far bigger than the 37 per cent decline for the UK as a whole and shows how the London market – where prices are at all-time highs and by far the most expensive in Britain – is most vulnerable to the impact of mortgage rate increases." | | | |
| Anecdotal evidence that the housing market is getting a pasting on 19:49 - Nov 4 with 3319 views | giant_stow |
| Anecdotal evidence that the housing market is getting a pasting on 14:35 - Nov 4 by NthQldITFC |
I reckon it's your horrible yellow and green curtains that are putting off Dave's potential buyers.
Serves him right for cleaning all the grime off yer windows.
Sorry. |
Brute! | |
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| Anecdotal evidence that the housing market is getting a pasting on 23:03 - Nov 4 with 3167 views | Churchman |
My view on this is that the housing market needed correcting, not least to in th3 longer term give first time buyers a chance to access the housing market.
There is plenty the government and lenders can do to stabilise the housing market from actually building houses, as they did with massive council house investment in the 1950s (with no money), before flogging them off for peanuts along with everything else, to shared ownership, mortgage guarantee schemes, making it harder to buy property for income purposes - in other words, something like mixed property provision that existed before the mid 80s.
The prices of houses will stabilise at some point and the houses in the better areas and locations will lose less value than the rubbish ones. It’s all about supply and demand. That was how it was in 1990. In terms of repossessions, yes, there will be a lot, just as there was then.
I hope that lenders do their best to keep people in their houses. They will try to as basically, they don’t want to lose money. In terms of support, with the government tearing up public services with such relish and voluntary services such as CAB under such pressure, I fear people will be very much alone. |  | | |
| Anecdotal evidence that the housing market is getting a pasting on 09:26 - Nov 5 with 2891 views | Swansea_Blue |
I remember at the time. I put my old man’s place on the market at the same time and had a 3-way bidding war well over asking price. But then he had nice neighbours |  |
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| Anecdotal evidence that the housing market is getting a pasting on 11:33 - Nov 5 with 2769 views | pennblue |
| Anecdotal evidence that the housing market is getting a pasting on 15:25 - Nov 4 by HARRY10 |
The flaw there is that demand is not static and is dependent upon a number of variables.
With mortgage rates increasing the amount affordable decreases - which has a downward effect on prices rather than on sales. However, there will be a sense of sitting on their hands as far as buyers go. Why buy now when it will most likely be cheaper later on., will be the thought.
What hit hard in the early 1990s was the combination of rising rates and job losses.
Anyone can sit out negative equity if they can still pay the mortgage. However for those struggling they may wonder if it is worth keeping the mortgage if there is no likelihood of the house price rising to what they paid for it. That was what caused so many to 'walk away'.... leading to a further house price drop as the market had more for sale than there was demand.
A one or two percent rise is not the same percentage increase on a 9% interest rate as it is on O.25% rate. ie the percentage increase will be higher this time.
And as energy bills eat into household income it will be cutting down to only the basics. A case of buy what you have to, not what you would like to. Expect closures in many of these areas.
When the Chancellor is saying 'expect hard times' expect hard times. This will come as quite a shock for those having lived with cheap money for the past couple of decades. |
It is the affordability calculations the mortgage companies do that will kill the prices. It won't really be people lacking desire to buy, it will they just can't get the mortgages for properties they were previously aspiring to buy. | |
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| Anecdotal evidence that the housing market is getting a pasting on 12:18 - Nov 5 with 2712 views | Zx1988 |
| Anecdotal evidence that the housing market is getting a pasting on 15:04 - Nov 4 by hype313 |
If he had to drop it by £50k, something tells me his agent is a shark, not Foxtons by any chance is it?
Get the listing by any means, and then give some BS excuse why they have to drop it at the realistic market rate. |
Given Ulla's location, I'd put money on it being either Minors & Brady or Starkings & Watson. Huge proponents of the 'stick it on at a silly price and see if we can hook someone' technique. | |
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| Anecdotal evidence that the housing market is getting a pasting on 12:47 - Nov 5 with 2683 views | Leaky |
| Anecdotal evidence that the housing market is getting a pasting on 13:45 - Nov 4 by StokieBlue |
Sounds like he may have been a bit bullish on the price there if he's only had one viewing (given you said this "whole time" which implies a decent amount of time).
SB |
A house is only worth what someone is prepared to pay for it. Not an estate agent or vendor's valuation |  | | |
| Anecdotal evidence that the housing market is getting a pasting on 12:48 - Nov 5 with 2672 views | HARRY10 |
| Anecdotal evidence that the housing market is getting a pasting on 11:33 - Nov 5 by pennblue |
It is the affordability calculations the mortgage companies do that will kill the prices. It won't really be people lacking desire to buy, it will they just can't get the mortgages for properties they were previously aspiring to buy. |
err, that is the point
As rates rise so do the cost. As long as the multiple of earnings stays the same (which it invariably does) then, say, 3 times earnings will buy less as the rates rise.
It is not correct to say demand still exists. Demand is the wish and the ability to buy. If it was just the wish then there would be a massive demand for a Rolls Royce car
However I think both the government and lenders learnt a harsh lesson in the early 90's and there is now not the requirement to repossess. So hopefully this will not spark the collapse we saw then. As it was recognised that paying to re-house a family was far in excess of what it was to help with the mortgage.
I would expect some form of deferred payments/part payments.
It is not in the interest of lenders to have a huge number of properties repossessed whereby they have to be auctioned off, way below the value of the loan. | | | |
| Anecdotal evidence that the housing market is getting a pasting on 13:44 - Nov 5 with 2620 views | Radlett_blue |
| Anecdotal evidence that the housing market is getting a pasting on 12:48 - Nov 5 by HARRY10 |
err, that is the point
As rates rise so do the cost. As long as the multiple of earnings stays the same (which it invariably does) then, say, 3 times earnings will buy less as the rates rise.
It is not correct to say demand still exists. Demand is the wish and the ability to buy. If it was just the wish then there would be a massive demand for a Rolls Royce car
However I think both the government and lenders learnt a harsh lesson in the early 90's and there is now not the requirement to repossess. So hopefully this will not spark the collapse we saw then. As it was recognised that paying to re-house a family was far in excess of what it was to help with the mortgage.
I would expect some form of deferred payments/part payments.
It is not in the interest of lenders to have a huge number of properties repossessed whereby they have to be auctioned off, way below the value of the loan. |
Repossessions are generally a last resort by lenders. The expense is high, this is usually contracted out to a 3rd party & the property is often sold at a knock-down price. Lenders would probably be better renegotiating terms with the borrower. In a severe crash, some may simply walk away from their property.
All the ingredients are there for a huge fall in property prices, especially in the South-East of England. Rates are only heading up & not coming back down quickly, many buyers over-extended themselves & they will be feeling the pain form energy price hikes. The Conservatives have continually tried to sustain the market, as most Tory voters are home owners, but this is only likely to make the subsequent fall worse. |  |
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| Anecdotal evidence that the housing market is getting a pasting on 19:59 - Nov 5 with 2502 views | TractorWood |
| Anecdotal evidence that the housing market is getting a pasting on 12:18 - Nov 5 by Zx1988 |
Given Ulla's location, I'd put money on it being either Minors & Brady or Starkings & Watson. Huge proponents of the 'stick it on at a silly price and see if we can hook someone' technique. |
A few do that in West Suffolk and Cambs. Basically stick it on for £100k more than its worth and hope someone relocating from London snaps it up for around the guide.
Pricing had gone stupid in some spots. A correction is inevitable as rates rise. I suspect the BoE will be slower in lifting base much higher. It will absolutely ruin the housing market if servicing debt goes much above 5/6%. |  |
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| Anecdotal evidence that the housing market is getting a pasting on 13:49 - Nov 6 with 2230 views | mutters |
Depends on what the asking price was initially. If its 50k on an 800k house then that's very different from 50k on a 250k house.
Around my part of the world (West Country), there are not enough properties, and when they go up for sale they still get snapped up, it's been like this for the last 4 years as Bristol people are moving out to find more space. I finally completed my house in Feb this year, though the price was agreed on in August last year. It has allegedly gone up 15% already in about 15 months, according to Halifax / Local Estate Agents. I fear there is a long way for prices to come down for it to realistically give first-timers a chance to buy a house.
Even if they can find the deposit you've got to contend with the increased mortgage costs. A heck of correction is needed in my opinion but i can't see it falling that far. |  |
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| Anecdotal evidence that the housing market is getting a pasting on 15:27 - Nov 6 with 2097 views | BlueandTruesince82 |
| Anecdotal evidence that the housing market is getting a pasting on 11:33 - Nov 5 by pennblue |
It is the affordability calculations the mortgage companies do that will kill the prices. It won't really be people lacking desire to buy, it will they just can't get the mortgages for properties they were previously aspiring to buy. |
4 months ago my cousin was starting to look at buying her 1st place, has the deposit etc, now she can't find a mortgage she can afford. |  |
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| Anecdotal evidence that the housing market is getting a pasting on 09:52 - Nov 7 with 1861 views | bluestandard |
| Anecdotal evidence that the housing market is getting a pasting on 15:25 - Nov 4 by HARRY10 |
The flaw there is that demand is not static and is dependent upon a number of variables.
With mortgage rates increasing the amount affordable decreases - which has a downward effect on prices rather than on sales. However, there will be a sense of sitting on their hands as far as buyers go. Why buy now when it will most likely be cheaper later on., will be the thought.
What hit hard in the early 1990s was the combination of rising rates and job losses.
Anyone can sit out negative equity if they can still pay the mortgage. However for those struggling they may wonder if it is worth keeping the mortgage if there is no likelihood of the house price rising to what they paid for it. That was what caused so many to 'walk away'.... leading to a further house price drop as the market had more for sale than there was demand.
A one or two percent rise is not the same percentage increase on a 9% interest rate as it is on O.25% rate. ie the percentage increase will be higher this time.
And as energy bills eat into household income it will be cutting down to only the basics. A case of buy what you have to, not what you would like to. Expect closures in many of these areas.
When the Chancellor is saying 'expect hard times' expect hard times. This will come as quite a shock for those having lived with cheap money for the past couple of decades. |
Agree with your point on the rising rate / job loss combo of the 90s. The difference here is that the number of home owners who over-extended to buy during the era of low rates could see their re-payments becoming unsustainable as a result of rising rates regardless of employment status due to the size of the mortgage relative to incomes (worse than it was in the 90s).
Not sure I get your point on interest rates, as 2% increase on top of 9% is the same in monetary terms as 2% increase on top of 0.25% as it is calculated as a percentage of the total loan. Either homeowners can afford an additional 2% or they can't, but I get the point that it will be a much steeper increase and will come as a shock. The effect will be exacerbated the more over-extended your are on your loan.
Personally, I'm not expecting a 90s style crash either, as banks will have learnt that a wave of repossessions is not good for the overall value of their security. Also, there is a lot of investment money 'waiting in the wings' which would surely enter the market if prices went down substantially, especially given the current costs of new construction. | | | |
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