UK house prices slump 2.6 pct in Sept from Aug - Rightmove
Property crash in UK is well under way.
With property prices tumbling and over 1 million depositors scrambling to withdraw their funds from Northern Rock splashed all over the media the UK crash could make the US crash look like a damp squib.
**Housing market’s bull run comes to an end
The financial crisis is not going to be over anytime soon and could extend well into 2008.This makes London town a sitting duck for a property correction as there are going to be major financial job losses here and the financial sector accounted for a lot of the froth in house prices here.
I don’t expect the building for the olympics to save the day here either.
Icy winds starting to blow through London.
No it certainly won’t save the day long term. One of the reasons the olympic areas were starting to rise so rapidly was because they were being bought as investment properties by those with city bonuses which I just don’t see as being that big for the next couple of years.
However I live in one of the marginal olympic areas and at the moment property is still moving very, very fast. I was on holidays for 10 days last month and a house on my street that was not for sale when I left was sold when I came back. (I double checked with the “last 14 days” feature on rightmove in case it was just for sale without a sign.) And another on my street sold in under 3 weeks and it was being sold with tenants in situ.
I’ve been watching it fairly closely and on the whole the public does not believe that prices are falling. Especially as it was reported widespread that prices were falling in 2005 and they roared on. I think what is happening in areas like mine is that people who would have 6 months ago been given a mortgage high enough to buy in a more upmarket area are just setting their sights on the next area down the ladder and are hoping that the olympic effect will make the area nicer. And as getting a family-sized house within half and hour of city and the west-end for under £350k seems like a bargain to people who were planning to buy the same house in a nearby area for £500k they can’t imagine those prices will fall even in a downturn. I don’t think it will last but at the moment the olympics is distorting things.
Personally I’m planning on selling early next year unless something radical happens which makes me change my mind. I bought last year for £250k and am tempted to sell now except that my husband is threatening divorce if I make him sell while he is working on the biggest film he has worked on in 7 years. I guess saving £20k of money we didn’t earn isn’t worth jeopardising his career for? But I’ve spent enough time reading boards and aam to know that even once it’s plain for everyone to see that the market is falling there are always enough people out there who think they know better, so I figure I’ll still be able to sell. (Especially as most investors in my area are locked into rental contracts with the council that don’t allow them to sell so they can’t all bail out at once.)
I know that feeling
What is your house worth now?
Thanks for that very comprehensive report.
Compared to rental yields? £167k.
The one that sold on my street while I was away was asking for £320k. The one with tenants was looking for £315k. As they both sold so fast I’m guessing they went for near or maybe above asking price. Neither of them was in terribly good condition which has still been a factor in the UK as bidding wars have never been the norm here. They seem fine structurally but the EA blurbs suggested they were “in need of updating” and they had no internal pics.
Houses on nearby streets have had asking prices of £345-350k and sold quickly. A house two streets away came on the market today at £355k so I watch with interest. I guess that if I sold today I’d get somewhere between £320k and £345K as my house is in pretty good condition. Don’t really know what it might get in March which when I think we’ll sell. I’d say we’ll be safe from losing money but that doesn’t stop my stomach from hurting when I think about it for too long.
** Selling UK Homes Becoming Harder**
**House prices may fall further, Hometrack says