House Prices

[littlepup]

It’s a leasehold house. I have read though that apparently after two years you have the right to buy the lease if you want so least there is that option. But they said it won’t increase so I think should be fine

Just there’s almost always a ground rent charge and a service charge and it would be higher I’d expect. Payment into sinking funds etc just be sure you know who’s responsible for what. They can also put clauses similar to rented like no pets, no sky dishes, can’t run a business from the house etc so just so long as you’ve seen it

 

[Begborrowsteal]

Usually, you start off with quarterly inspections but over time they can go longer. We had 1 inspection a year in our last place as we were there for over 5 years. Our new house, no inspections as the landlord wants to work on trust ( very risky! But hes had 1 very long term tenant before us).

Tenants dont have to agree though, they have the right to refuse entry and visits. Its extreme, but it happens.

 

[Anne1448]

I’m wondering if this’ll result in negative equity for some people? I know that’s only realised once you sell and no one will buy just to get rid a year or two later, but I’d be worried if I had bought in the price boom tbh.

Looking at houses that have gone near me I’d say they’re 10-20% over what I’d have said one could go for prior. Someone bought an absolutely dilapidated shit hole, like not fit for human habitation needs ripping out from the windows to the walls shit hole, for 15% more than we paid for a house that just needed re decorating 2 years ago.

This gives me PTSD from the celtic tiger period in Ireland. People who couldn't afford the negative equity are still paying their mortgages to this day.

 

[Homelifewith4boys]

I noticed here in Scotland that some of the houses that were on before covid came off and then when everything started back up again they were put back on but with a slightly higher price.

 

[Yel]

Oh for sure, the less we have to borrow the better! But even to get one of the cheapest houses in our area with 80% LTV we’d need a minimum of 30 odd grand which just isn’t going to happen. We could probably get a small flat with what we have now but I just don’t feel like a leasehold flat is a very good investment considering we’d have already outgrown it by the time we move in!

I just think no point rushing now, can't see them going up and they fell quite a bit in 2008 and what we have now is way way worse than that (and lots don't realise it yet). We're still in furlough world right now so it feels like everything is fine and just going to carry on.

House price inflation was close to 0 even before covid:

Repeating myself but in 2008 they had loads of fiscal tools to use, but they've mostly used now and things were just limping along not out of the last recession so a rampant recovery seems unlikely.

 

[Moe]

Are estate agents not allowed to tell us counter offers made by interested parties?! How the bloody hell do I know if I can counter them or not?

No they are not allowed but they do their best to hint at what’s been offered.
The market here in the South East has been very busy I think a lot to do with the Stamp Duty however come next year I think that will change drastically.

 

[Yel]

Well I can definitely say the housing market where I live has started up again with a vengance! I’ve been phoning estate agents about various properties I’ve seen which have been listed since March/April - all have gone in the last 2 days, all had several offers on them and I’m assuming went for well over the asking price. Now it looks like there’s too much demand and not enough houses - good for the rental sector I guess! So we are back to either renting for another year or buying a new build.

I'm not seeing anything like that around here (south east). Good properties have been going under offer but still lots of things that have been around since the start of the year.

There's always going to be a bit of pent up demand, it's how long that lasts for is the question. The economy isn't going to bounce back as quick as some people say, and it's not as fucked as others say.

 

[HoGi]

They are in the north west. We just put a house up for sale and someone offered 50k over the asking price, absolutely ridiculous.

Are the mortgages agreeing with the valuation on these properties?

A few years back lots of people i know, myself included, were having properties down valued. So our example house was up for 300 which is average for the area. We offered 295 and it was accepted. Mortgage came back and said the house was only worth 280. So as first time buyers we had to pull out as the sellers wouldn't drop the price.

So I wonder with these houses where people are offering tens of thousands over the asking price are the banks agreeing the value?

 

[Yel]

This graph was in the fail to show mortgage approvals, with thousands of job cuts annoyed every day approvals will still be way down.

Honestly I think it's the start of something new, people have been conditioned and used to insanely high house prices but it need not be that. They probably won't have a huge crash as inflation will hide it but it's so insanely difficult for anyone younger to get a house so that was never going to last forever.

 

[heretoreaditall2019]

Do you mean you want to see other properties so you can value your own? Online details can be very, very misleading. The pics won’t show up damp or subsidence etc nor tell you if the seller wants a quick sale or is in a big chain so unless you’ve been in the property and spoken to the agent it’s hard to narrow it down. Obviously there’s a rough ceiling price you can work to but what something is advertised for and what it sells for can be really different and if you wait for the sold price to come onto zoopla the price market have changed - certainly at the moment.
Just get a few agents round to value. It’s no obligation and even if you do put your house on the market you always want a few agents to value so they’re more than used to valuing without it becoming a listing.

Oh agreed, I would only go off of price sold but it’s nice context to see the insides. If a load of sold properties are going to have updated sales prices but no corresponding images then it just makes it a tiny bit harder to understand what went on over 2020/21 tbh. It’s complicated even more so by the fact prices are grossly inflated right now, I think for the next 2/3 years it’ll be challenging to determine a reasonable price for a property and I wouldn’t want to go too high and have it sat there for weeks/months. Who fucking knows tbh.

 

[orange club biscuit]

You may find it’s the people who have lived in the South moving North, so they have more money from sales of property etc available to them....

Yeah I’ve no doubt that this is part of the issue! Personally, even if I were in a position where I was mortgage free I’d still not want to be in negative equity though but clearly there are some people who don’t mind...

 

[Anne1448]

Yeah, it sounds like a private sale to me. If your house is in a sought-after neighbourhood, if you have a good network, a buyer lined up or a good agent usually houses are sold like that.

The "For sale" sign is put when there is no buyer lined up. So, the agency or the seller has to draw attention to it publicly.

 

[JoeBloggs]

Yes you're right, that is the only drawback of renting. My SIL bought her house as a new build 22 years ago, she only has three years of repayments left but is already talking about taking out a loan as soon as she's nearly debt free the house needs a new kitchen, new bathroom and she could he doing with an extra bedroom now that her kids are teenagers and wanting their own space. It's never ending, it's like no matter what your situation you're still at the mercy of the landlords or the banks!

I wouldn’t say it’s the only drawback, it’s much cheaper to buy in the end. My mortgage payments on a 3 bed house are less than my rent on a 1 bed flat.

I guess you are at the mercy of the banks of you live off loans and credit.

 

[Kmt2019]

Just saw this in the DM:

Britain's mini housing boom: Stamp duty cut adds £30,000 to average property asking price with sales up 20% as house-hunters battle to buy before six-month tax break ends

#

 

[Boutros-Boutros Ghali]

We looked at both but went for an older house. Just felt that it had more potential to change over time, and also felt sturdier if that makes sense. Also all had quite small gardens and felt very overlooked. But new was tempting as could just move straight in and not think about it, especially as we were moving to a totally new area and have no contacts in terms of builders etc. What finally decided it for us was location, none of the new builds were really where we wanted to live, not close enough to shops/pubs/general life, just massive estates of houses and nothing else unless you go by car

 

[Italy2]

I don’t know much about buying houses in the uk in general but I thought the minimum deposit was 10% unless you’re getting a new build on a help to buy scheme? Maybe different in Wales where I am. I wouldn’t be surprised if banks start asking for higher deposits too which is a pain. We were supposed to start looking end of this year, and we were in the process of setting up a meeting with a mortgage advisor so this is all now on hold. I’ve been checking rightmove and nothing seems to be much cheaper, but nothing is selling. I’m scared that no one will sell after lockdown and we’ll be renting for years! Unless we get a new build which I am dubious about if I’m honest.

Generally the minimum deposit required is 10% but some mortgage lenders offer 95% LTV with 5% deposit with a higher interest sometimes or just a longer mortgage term. I personally think 5% deposit is a better route than shared ownership scheme or help to buy schemes but some people may disagree. Obviously it is better if you can save up for a 10% deposit. We will be looking to buy our first house and have recently finished university so I think if we can get on the property ladder with a 5% deposit and slightly longer mortgage term then it's worth it. We would look to overpay our mortgage payments when possible and make up for the length of term. I rather do this than pay someone else's mortgage while I save 10% deposit.

Nationwide report house prices down 1.7% in May.

View attachment 143638

House Price Index Headlines | Nationwide

Read the latest headlines on the house price index and download our monthly and quarterly house price index reports.

www.nationwide.co.uk

UK house prices fall at fastest rate since 2009 amid coronavirus crisis

https://www.archive.is/oldest/https...2/uk-house-prices-fall-coronavirus-nationwide

Interesting insight, thank for sharing! 1.7% is quite low but still a decrease which is huge as pre-covid prices were steeply increasing!

 

[idk2]

Headlines are saying house prices are still surging, when actually it's the asking prices. So pretty meaningless.

Headlines today encouraging people to fill their boots as it's 5 months untill stamp duty comes to an end
View attachment 282704

We're still holding out for next year. As horrible as it sounds, I dont think we've hit boiling point yet with unemployment etc.

 

[Homebird44]

This is something that has been raised a few times at government level and I think in time will have to become a part of the mortgage application process. If you’ve rented for years, have never defaulted, have a good cedit history and have a stable income then that should be enough without the requirement for a ridiculous deposit.

We didn't even have a deposit, we had a cashback deal with our mortgage that covered the deposit. I'm so envious of anybody that has never needed to remortgage. Id have three years left and be paying about £300 a month. I wish!!!

 

[mindlessness]

Yeah, I have a few friends buying here in Australia at the moment (late 20s/early 30s, buying homes rather than investments) and I'm not exactly tempted to join them. House prices are going up at the moment and I feel like I'm just watching and waiting for an inevitable drop

 

[Yel]

Okay, stupid rich people will buy all the houses, what’s the difference?

That there's very few rich stupid people compared to how many smart rich people

The people pushing up prices are the ones remortgaging to then borrow multiples of this to speculate. It's a pyramid scheme.