Property crash, just maybe it really is different this time

[Noallegiance]

35 minutes ago, HousePriceMania said:

This means one thing for house prices and it aint up...

 

It's been half an hour since you posted this!

What is it, then?!!!!!

[Ina]

My lovely colleagues in our Residential Conveyancing team are suddenly very twitchy having noticed a recent sea change.  Our FD is more so.   In Probate granny houses with the usual artex, swirly carpets, woodchip and pink bathroom suites that previously would have been snapped up by 30 year old doer uppers are not a shifting.

[Boon]

Stagnation in nominal terms which means people get robbed without realising it??

I do feel 'the pivot' has been priced in to housebuilder shares..... let's face it, at sustained higher mortgage rates and no government props it is difficult to see them being profitable.

Take the average £500k shitbox in London, which only really sold due to people with HTB, BOMAD or equity from a previous sale. Oh yeah, BTL landlords who were happy to take tiny yields and also foreigners who want to keep their money safe. All of these categories I think are on the wane for various reasons.

Of course there will be the odd high earner/£100k household income but they would need to be gullible as well, just buy a house if you have the cash. 

If nothing comes to the rescue the profit on these places is gonna disappear. But the housebuilders are hardly priced for insolvency. 

[Axeman123]

1 hour ago, HousePriceMania said:

Mortgage rates and bank rates are 2 different things

Unless 10 houses is going to bring back Term Funding, or some other sub-prime debt funding scam  then mortgage rates will go up as banks have to raise money on the open market

Im not saying they wont do it, but right now with inflation causing everyone a headache, it looks unlikely.

This means one thing for house prices and it aint up...

I am totally with you on all that, and especially the final sentence. I am just suggesting a reason for share prices in that sector to bottom and/or make a small recovery.

[JoeDavola]

51 minutes ago, Ina said:

In Probate granny houses with the usual artex, swirly carpets, woodchip and pink bathroom suites that previously would have been snapped up by 30 year old doer uppers are not a shifting.

Possibly because people are starting to realize how much it's actually going to cost to renovate them.

Edited July 21, 2022 by JoeDavola

[HousePriceMania]

14 hours ago, Noallegiance said:

It's been half an hour since you posted this!

What is it, then?!!!!!

You tell me 

UKPropertyLion has been checking RM weekly and there is a definite surge in available listings, with a daily net gain of 513 properties for sale, 3.5% since the start of the month and 30% up from Jan, which is unprecediented.

513 gain per day = 187,245 per year so although it sounds small, it's not to be sniffed at.

There does seem to be a natural increase in the summer months before COVID but this one does seem to be a complete reversal of the 2020/2021 market.

 

Given how few properties I see being listed locally it's a fair bet nothing is selling.

So if house prices are driven by supply/demand or credit/low IRs it's looking pretty screwed on both fronts

BTW, prices down for the 3rd week in a row, -0.4% now. A tiny amount but a welcome change in direction.

Actually -0.4% decline in 14 days might be significant, would be -10% yoy!!!

 

Edited July 22, 2022 by HousePriceMania

[Noallegiance]

9 minutes ago, HousePriceMania said:

You tell me 

UKPropertyLion has been checking RM weekly and there is a definite surge in available listings, with a daily net gain of 513 properties for sale, 3.5% since the start of the month and 30% up from Jan, which is unprecediented.

513 gain per day = 187,245 per year so although it sounds small, it's not to be sniffed at.

There does seem to be a natural increase in the summer months before COVID but this one does seem to be a complete reversal of the 2020/2021 market.

 

Given how few properties I see being listed locally it's a fair bet nothing is selling.

So if house prices are driven by supply/demand or credit/low IRs it's looking pretty screwed on both fronts

BTW, prices down for the 3rd week in a row, -0.4% now. A tiny amount but a welcome change in direction.

Actually -0.4% decline in 14 days might be significant, would be -10% yoy!!!

 

I've had a local search area alert set up for a few years.

I reckon for the last 6 weeks it's hit an average of 7 new properties a day vs 2 or 3 a week before that.

[HousePriceMania]

3 minutes ago, Noallegiance said:

I've had a local search area alert set up for a few years.

I reckon for the last 6 weeks it's hit an average of 7 new properties a day vs 2 or 3 a week before that.

There is undoubtedly more properties, UKPL is not off the back of some fag packet.  We've got millions of property datum

If the numbers of listings are up this significantly and CURRENT prices showing falls you can be pretty sure that's what's happening.

It's the only honest index out there

[marceau]

14 hours ago, Boon said:

 

If nothing comes to the rescue the profit on these places is gonna disappear. But the housebuilders are hardly priced for insolvency. 

The housebuilders were carrying vast amounts of debt going into the financial crisis. BDEV had a crippling debt load and was genuinely lucky to survive. None of them are as extended now, plus, as many have pointed out, continuing govt support to the wider market is assumed.

Edited July 22, 2022 by marceau

[HousePriceMania]

The Isle Of Man is one region of Britain the UKPL tracks but the number of listings are so low it's not worth following...although I am starting to see a trend.

 

 

 

I get the feeling this is significant.

 

https://www.globalwitness.org/en/campaigns/tax-haven-next-door/

Why would people be selling up in a tax haven, anyone have any theories ?

 

[haroldshand]

15 hours ago, Ina said:

My lovely colleagues in our Residential Conveyancing team are suddenly very twitchy having noticed a recent sea change.  Our FD is more so.   In Probate granny houses with the usual artex, swirly carpets, woodchip and pink bathroom suites that previously would have been snapped up by 30 year old doer uppers are not a shifting.

Keep the information coming

There is practically nobody else you can really trust these days of property value predictions, my opinion on falls are changing daily, sometimes twice in a day

[JoeDavola]

15 hours ago, Ina said:

My lovely colleagues in our Residential Conveyancing team are suddenly very twitchy having noticed a recent sea change.  Our FD is more so.   In Probate granny houses with the usual artex, swirly carpets, woodchip and pink bathroom suites that previously would have been snapped up by 30 year old doer uppers are not a shifting.

I'd that where I am such houses make up a very significant percentage of the market.

Probates and divorces seem to be most of what are coming on.

Limits to mortgage debt are one thing, but in a stagflation environment a house renovation might be something that the vast majority of people just can't afford.

[Bilbo]

Fag packet calculation.

Most people aged 65 and over (79%) live in a home they own. 74% of people age 65 and over own their home outright – while 4.6% are paying off a mortgage.

And if approx 600k people die every year. Most will be over 65 and say two people per household.

Estimate 240k house to go to probate per year. Or have I missed something?

 

[Wight Flight]

35 minutes ago, Bilbo said:

Fag packet calculation.

Most people aged 65 and over (79%) live in a home they own. 74% of people age 65 and over own their home outright – while 4.6% are paying off a mortgage.

And if approx 600k people die every year. Most will be over 65 and say two people per household.

Estimate 240k house to go to probate per year. Or have I missed something?

 

The kids (well the boomers in reality by now) will give them a lick of magnolia and rent them out.

[spygirl]

7 hours ago, JoeDavola said:

I'd that where I am such houses make up a very significant percentage of the market.

Probates and divorces seem to be most of what are coming on.

Limits to mortgage debt are one thing, but in a stagflation environment a house renovation might be something that the vast majority of people just can't afford.

Death divorce debt.

[spygirl]

6 hours ago, Bilbo said:

Fag packet calculation.

Most people aged 65 and over (79%) live in a home they own. 74% of people age 65 and over own their home outright – while 4.6% are paying off a mortgage.

And if approx 600k people die every year. Most will be over 65 and say two people per household.

Estimate 240k house to go to probate per year. Or have I missed something?

 

See - 

 

~50% of over 65s will die in the next 10y.

Home ownership I.e bit of equity build up upon the under 40s barely exists.

 

 

[dnb24]

On 08/07/2022 at 17:48, dnb24 said:

Steady couple of weeks at 1205-1220 listings until today- now at 1260. 

Down this week- back to 1200.

[ste]

Not seeing any changes in prices, but getting more alerts for places I haven't for a while or rarely get for the criteria i've set, plus listings are up - with what look like obvious rental properties coming up more and more.

Also a handful half renovated places have come up this week too which is rare.

[Axeman123]

39 minutes ago, ste said:

Not seeing any changes in prices, but getting more alerts for places I haven't for a while or rarely get for the criteria i've set, plus listings are up - with what look like obvious rental properties coming up more and more.

Also a handful half renovated places have come up this week too which is rare.

I recently saw a Zoopla listing for a house local to me that had obviously suffered a small fire in a bedroom, with blackened walls and freestanding wardrobe. I don't think I have ever seen one like that before. Presumably they would normally go to someone with a friend on the inside for a quick clean up etc, and then be flipped.

[Boon]

I track London and surrounding areas and dunno if it me but new listing volumes seem to have dipped over the last couple weeks - heading back down to pandemic lows. Hopefully this might just be a function of the weather and people going on holiday. 

Feels like more stuff is stuck - often last year especially houses would be gone SSTC almost instantly, not so common nowadays.

Pandemic saw a lot of flipping, not sure even seasoned developers might be having problems sourcing projects this year as listing prices and renovation prices are high. Something like this I would think might need at least £575k to make it worth it and might not get it if interest rates are higher.

[With a crooked smile]

Bloke at work SSTC, having difficulty finding a place to buy. Booked to see house this weekend advertised at 580k, estate agent rang him today to confirm he still wants to view as current bidding is 670k. That's Sheffield area. 

His concern is that's about the max that he can afford and he'd be worried about the surveyors report valuing it at less for a mortgage. 

By the way the guys early 30s. Very socialist working class background. I doubt there's been any BOMAD in thr past. Kinda blows out those ideas that the relatively young can't get on the ladder and move up it.

He's in software sales.

[Formerly]

8 hours ago, With a crooked smile said:

Bloke at work SSTC, having difficulty finding a place to buy. Booked to see house this weekend advertised at 580k, estate agent rang him today to confirm he still wants to view as current bidding is 670k. That's Sheffield area. 

His concern is that's about the max that he can afford and he'd be worried about the surveyors report valuing it at less for a mortgage. 

By the way the guys early 30s. Very socialist working class background. I doubt there's been any BOMAD in thr past. Kinda blows out those ideas that the relatively young can't get on the ladder and move up it.

He's in software sales.

The exception that proves the rule? I'm guessing he's on at least triple the median wage, with a huge mortgage (otherwise why worry about the surveyors valuation?).

He's hardly in a situation typical of his peers, especially if he doesn't also have huge student debt. And he's still struggling to afford the house he wants.

Of course, you'll always be able to find people who can afford what most can't. But that's the point. Some can do it, but most cannot.

[AyrshireBoy]

A friend is a mortgage advisor with HSBC who are known for tighter lending criteria. She told me this week thats she's never seen so many applications being knocked back and AIPs are worthless now.

[With a crooked smile]

2 hours ago, Formerly said:

The exception that proves the rule? I'm guessing he's on at least triple the median wage, with a huge mortgage (otherwise why worry about the surveyors valuation?).

He's hardly in a situation typical of his peers, especially if he doesn't also have huge student debt. And he's still struggling to afford the house he wants.

Of course, you'll always be able to find people who can afford what most can't. But that's the point. Some can do it, but most cannot.

I know he has a degree, his wife is a teaching assistant. Yes he's on a good salary. We all are in SaaS. And that's the point really. Lots of people go on about average wage here. The reality is there are plenty of people under 40 that can afford and are buying houses all over the country without government schemes. 

[belfastchild]

1 hour ago, AyrshireBoy said:

A friend is a mortgage advisor with HSBC who are known for tighter lending criteria. She told me this week thats she's never seen so many applications being knocked back and AIPs are worthless now.

Neighbour is the same (not HSBC), told me yesterday that they are starting to exclude bank earnings from NHS applicants. Nurses etc who use their days off to work shift for agencies. Was always included in the past, now seen as temporary earnings which arent guaranteed.
If they are excluding those, which are pretty much guaranteed due to shortages etc, then something is up.