Today in the news: UK House Crash - 1 in 4 chance

Lotsa house building up north - prices slow down or drop

Not so much down south (shortage of land) - prices stay consistant/rise.

It did not agree with Grouty though, so now I'm confused.

You don't think they had a particular agenda for the site's content when they picked the domain name, by any chance?

Any major moves on housing prices from the Treasury will be in response to the new fad for baby-boomers retirement cash i.e. buying, doing up, selling. Which will probably be a move to make it easier for them as the Collective Retirement Payout for that lot is absolutely k-huge and it'd be an idea to keep that money in the UK rather than giving it to Ski Resorts and German car companies.

Yeah, I know - but some might argue that belief in potential creates potential, and if a site has been set up, devoted to the notion of a crash, could this nor be a good indicator?

x-post

I (and my partner) own a flat. It cost us £155,000. Over the 25-year life of the mortgage, payments including interest mean that we will eventually have paid around £400,000 (!) for this flat. And over a 25 year period, the actual "worth" of that money becomes irrelevant because of inflation etc.

Essentially what I'm trying to say is when you're talking about paying out that much money for something, what real relevance is it if it's "market value" drops? Also, if the price of my flat drops, won't all others drop by a similar amount, so the value of it remains the same?

I think maybe I've missed something vital here, but it seems the people who really miss out because of high house prices are people who can't afford to buy at all. Homeowners shouldn't really fear a crash, should they? After all, what's really important is the fact that you have a roof over your head and your not paying the mortgage for a scummy landlord (council tenants excepted).

My next-door neighbour is planning to sell his house. He's very excited that (on an optimistic comparison to other houses in the area) his house might now be worth £150,000 when he paid £15,000 for it, and is currently the same again ripping out the interiors and replacing everything. That was in 1982, though, and he doesn't seem to understand concepts like 'inflation' or 'total repayment'. As far as he can see, when he sells up, 80% of what he gets will be pure profit.

(for SIX MONTHS there's been a big pile of dead branches, trashed kitchen worktops, an old central heating boiler and a sink piled up in his front garden, because, on doing up his house and garden, he assumed that the council refuse department would just take all the rubbish away and is too much of a skinflint to pay to get rid of it all)

What the...? *heavy rustling* Must... find... paperwork...

Is this what they call Negative Equity?

Whoops, too late.

See also: endowment mortgage shortfalls (which are caused by drops in the general investment market, rather than the housing market in particular)

"The state, action, or principle of treating all persons equally in accordance with the law"

(like me over in Grimsby, not that I actually own my house)

Freelance UK

A slump in the average asking price for houses in England and Wales appears to be imminent, according to a study from a national estate agent.

The findings show that a decline in the cost of property is all but certain, fuelled by overvaluations of 19 per cent and the worst record of affordable homes in 13 years.

This is according to Cluttons, the property consultant and think-tank, the Oxford Economic Forecasting group, which collectively point to price falls of up to 4 per cent by the end of the year.

The research shows that there is an 85 per cent likelihood of such a decrease, while there is just a 5 per cent chance of a 17 per cent slump in prices over the next three years.

This overall picture of decline clashes with the latest data from property website Rightmove, which predicts a mini wave of higher prices, as sellers aim to attract any festive buyers over the Easter holidays.

According to the group's reading of the market for March, prices in England and Wales rose by 0.6 per cent – or an average of £1,132, as sellers sought to maxmise the profits of their home.

But analysts warn that sellers are misguided if they believed buyers are ready to pay top rate prices.

A spokesman for the website said: "It's counter-intuitive that sellers are looking to push up prices when there is already a huge oversupply of homes for sale. They need to be more realistic. Only people who are being realistic are selling at the moment."

Last week, Freelance UK reported on the untouched backlog of UK property which is now at its highest since March 2003.

Market observers and estate agents have suggested that attracting first-time buyers is critical if the market is to shift some of the existing properties that are still for sale.

Last week, Gordon Brown announced he would raise the threshold on stamp duty for first time buyers from £60,000 to £120,000.

Though some accuse the Chancellor of not taking action soon enough, given data that shows the average age of the first-time house buyer in the UK is 34-years-old.

According to the Council of Mortgage Lenders, this gloomy picture is made worse by the lowest number of first-timers buying property since the 1970s.

The CML said there were 358,000 buyers last year; a reduction of 9,000 on 2003 and a 40 per cent drop off from the boom times seen in 1999.

"Rapidly rising house prices have meant that potential first- time borrowers are unable to raise a sufficient deposit to enter the market. Anecdotal evidence suggests that first-time buyers are clubbing together with friends or, potentially, with the help of their parents to buy, because of affordability constraints."

The Council said the situation has been made worse as wages for people have not risen in line with the housing market.

The average price for a first home in England and Wales is now around £117,000 – a sizeable sun, even when compared to the average cost in 1999 of £58,000.

It is expected that this price could now increase as unduly optimistic sellers start to fluff up the cushions in their property, keen to welcome in any Easter house-hunters.

Mar 23, 2005

Also, I've read that the average property goes for about 92% of the asking price. So if something went on for £170,000 it would only sell for £156,000 in the end, which suggests that the initial offer from the buyer must have been even lower (£150,000?). So even if these 'unduly optimistic sellers' fluff up their cushions and stick another couple of grand on their asking price, it won't make much difference, because they'll stick have to knock off thousands before it goes.

the £105k i supposedly might be able to muster, gets me...a studio in leytonstone