Property crash, just maybe it really is different this time

[Yadda yadda yadda]

4 hours ago, Ash4781b said:

https://amp.theguardian.com/money/2023/feb/24/lots-of-us-are-very-anxious-why-britains-buy-to-let-landlords-are-selling

“Philip Harris, a 42-year-old designer who has properties in south and east London, became a landlord by accident after meeting his now wife. She already had a flat, but rented it out, and the couple bought a property off-plan, when it was still at the design stage. When their children were born, they needed more space and bought a third property, renting out the second one. At the time, they saw their small portfolio as a retirement investment, but now, worried about mounting costs, they want to reduce the risk by selling one of the homes.”

I don’t think accidental landlords exist. On one hand it’s investment then an accidental landlord.

I can see a new couple keeping an extra property on for a while when they move in together. An insurance policy against the relationship not working. If you can't commit to a single home then you shouldn't be getting married. At that point it is clearly an investment decision. Moving to a bigger home because you have children and renting out the second home is in no way an accident. Do they think they garner any sympathy rather than coming across as a couple of speculators?

[Democorruptcy]

Taxy taxy:
 

Quote

 

UK tax authority launches crackdown on holiday let owners

HM Revenue & Customs has launched a crackdown on the booming short-term lettings market by initially targeting about 1,000 property owners that it suspects have not paid enough tax.

Based on information received from online bookings platforms such as Airbnb, the UK tax agency is sending its first so-called “nudge” letters this month to those it believes have not declared income earned from rentals on their self-assessment tax returns. Recipients of the letters have been given 30 days to respond or risk a formal inquiry into their tax affairs.

HMRC’s scrutiny comes as the holiday rentals market has grown rapidly in recent years, helped by the preferential tax treatment of short-term lettings compared with traditional buy-to-let rentals.

About 127,000 individuals in the UK declared ownership of businesses for furnished holiday lets in their personal tax returns in the 2019-20 tax year, the latest year for which data is available.

Airbnb does not give a geographical breakdown of rental numbers by country but analysis by the Guardian in 2020 showed its active UK listings jumped from 76,000 to 257,000 between April 2016 and January 2020. Airbnb said last year that the typical UK host earned just over £6,000 per year.

https://www.ft.com/content/8a120778-520f-49c2-b59b-923849c0c205

 

 

 

 

[Formerly]

4 hours ago, JoeDavola said:

I'd add that it's not just about wages + mortgage rates

It's also about taxes and the costs of living. When you keep less of what you earn due to an increasing tax burden and increasing costs of keeping yourself warm and fed, then there is less to spend on buying a house.

[JoeDavola]

Just now, Formerly said:

It's also about taxes and the costs of living. When you keep less of what you earn due to an increasing tax burden and increasing costs of keeping yourself warm and fed, then there is less to spend on buying a house.

Very good point, and increased cost of heating and maintaining houses.

[MrXxxx]

11 hours ago, Ash4781b said:

https://amp.theguardian.com/money/2023/feb/24/lots-of-us-are-very-anxious-why-britains-buy-to-let-landlords-are-selling

“Philip Harris, a 42-year-old designer who has properties in south and east London, became a landlord by accident after meeting his now wife. She already had a flat, but rented it out, and the couple bought a property off-plan, when it was still at the design stage. When their children were born, they needed more space and bought a third property, renting out the second one. At the time, they saw their small portfolio as a retirement investment, but now, worried about mounting costs, they want to reduce the risk by selling one of the homes.”

I don’t think accidental landlords exist. On one hand it’s investment then an accidental landlord.

Blimey the pair of them are accident prone...oh well, at least it will be easier to get rid of the kids [their other accidents?] in 16 years time than it will their 'property empire'!

[spygirl]

On 25/02/2023 at 09:47, Ash4781b said:

https://amp.theguardian.com/money/2023/feb/24/lots-of-us-are-very-anxious-why-britains-buy-to-let-landlords-are-selling

“Philip Harris, a 42-year-old designer who has properties in south and east London, became a landlord by accident after meeting his now wife. She already had a flat, but rented it out, and the couple bought a property off-plan, when it was still at the design stage. When their children were born, they needed more space and bought a third property, renting out the second one. At the time, they saw their small portfolio as a retirement investment, but now, worried about mounting costs, they want to reduce the risk by selling one of the homes.”

I don’t think accidental landlords exist. On one hand it’s investment then an accidental landlord.

Aneisha Beveridge, head of research at Hamptons, said: “Some landlords have sold up, but the majority are trying to take a longer-term view.”

“Most landlords with mortgages are reading up on them and know rates will come down. They will be nowhere near as low as they used to be, but down a bit.We will see more landlords sell than buy this year, and possibly next year, too, so there are definitely risks, but I would not say it is the end of buy-to let.”

She says there are risks for renters. Higher mortgage rates will delay the purchase of first homes, forcing people to rent for longer, further driving demand in an already overheated market. Hamptons thinks rents will continue rising this year as a result.

“It’s a hard mechanics to figure out,” says Beveridge. “If landlords were to sell, then I think about a third of sales will be bought by other landlords, and some will get bought by first-time buyers.”

Phew...

https://www.mortgagesolutions.co.uk/news/2021/09/27/housing-market-to-slow-after-summer-growth-peak-hamptons/

A second wave of lockdown-induced demand will keep price growth in positive territory at 3.5 per cent in 2022, three per cent in 2023 and 2.5 per cent in 2024.

Err

More homes will have sold in 2021 than in any year since 2007.  Hamptons forecast 1.5m completions in Great Britain in 2021.

Errr

 

[Wight Flight]

13 hours ago, spygirl said:

“Most landlords with mortgages are reading up on them and know rates will come down.

[HousePriceMania]

We're not doing a weekly property lion index any more but the software runs weekly anyway.

Since the start of Jan prices have definitely bounced, now up £1000 since start of Jan.

Compare this to last year, prices bounced up £7000 in the same period.

Volume of listings continue to surge, up 7000 in a couple of weeks, that's up 25,000 since January.  At this rate available listings will go above pre-covid lows in around 6 weeks !!!

The numbers say to me, people are rushing to sell, no one is rushing to buy.

[HousePriceMania]

4 weeks I reckon will we are at Dec 2019, where prices were predicted to fall 15% and IRs were 1%....

[Democorruptcy]

Lloyds update last week included a bit about property prices and mortgage lending. Their daily mortgage lending now is about 25% lower than normal but 100% higher than Truss time, with mortgage rates down since then, despite subsequent base rate rises.

Quote

 

LONDON, Feb 22 (Reuters) - Britain's Lloyds Banking Group (LLOY.L) signalled that falling house prices, competition on savings and rising costs may crimp future returns after reporting flat profit growth for 2022.

Lloyds, Britain's biggest mortgage lender, said home loan volumes across the sector had plunged to between 1.1-1.2 billion pounds a day, down from 1.5 billion pounds normally, adding that house prices are likely to drop 7% this year.

While mortgage volumes across the sector were down on normal times, Lloyds Chief Executive Charlie Nunn said, they had recovered from levels in the weeks immediately after a disastrous government 'mini-budget' last September when they fell to about 600 million pounds a day.
The ensuing market chaos led to a mortgage rate spike. While rates had since fallen, many people were still paying higher rates, of around 4%-4.5%, than they were used to, he said.

"We do expect a slower year for mortgages in 2023, so that's what we've built into our plans," Nunn said.

https://www.reuters.com/world/uk/lloyds-full-year-profit-flat-bad-loan-charge-weighs-2023-02-22/

 

 

[AlfredTheLittle]

I'm looking at the moment, asking prices still seem very high and houses are still selling, although there are lots that have been on for a couple of months. Estate agents seem fairly busy, for example I couldn't get a couple of viewings last Saturday that I tried to book a couple of days before. 

Hopefully there will be another decent interest rate rise in March, that might get things moving.

[HousePriceMania]

7 minutes ago, AlfredTheLittle said:

I'm looking at the moment, asking prices still seem very high and houses are still selling, although there are lots that have been on for a couple of months. Estate agents seem fairly busy, for example I couldn't get a couple of viewings last Saturday that I tried to book a couple of days before. 

Hopefully there will be another decent interest rate rise in March, that might get things moving.

The asking price for new stuff being listed is above 2022 I reckon but nothing is selling and people are having to drop their prices.

I spoke to an agent last week and he was very bullish ( or lying through his teeth ).

The facts remain...available listings numbers are shooting up and the annual spring bounce is being suppressed by falls on stuff that have been listed since last year. The reality for the new vendors is that they are at the back of the queue now because their asking prices are crazy.

 

Edited February 27, 2023 by HousePriceMania

[Long time lurking]

 

[HousePriceMania]

On 24/02/2023 at 10:57, JoeDavola said:

Would explain the prices I'm seeing in NI, which still continue to rise albeit slightly more slowly.

 

Nice £200K off this big house in NI.
 

That's about £190 per sq ft, that's a bargain around here.

Stepford wives included ( have a look at the photos ).

[eek]

1 minute ago, HousePriceMania said:

Nice £200K off this big house in NI.
 

That's about £190 per sq ft, that's a bargain around here.

Stepford wives included ( have a look at the photos ).

It's a new build so doesn't exist.

Given the new price I would be paying a lot of attention to the quality of the materials being used in case short cuts are being made.

[JoeDavola]

2 minutes ago, eek said:

It's a new build so doesn't exist.

Given the new price I would be paying a lot of attention to the quality of the materials being used in case short cuts are being made.

Correct. You'd be mad to buy a house based on some CGI renderings.

Lots of people in NI got burned in the 07 crash when 'luxury' developments turned out to be nothing of the sort once they were actually built.

[HousePriceMania]

2 hours ago, JoeDavola said:

Correct. You'd be mad to buy a house based on some CGI renderings.

Lots of people in NI got burned in the 07 crash when 'luxury' developments turned out to be nothing of the sort once they were actually built.

Ahhh, remember the off plan Spanish buyers...this is from Sept 2007...saying the heady days of off plan were gone but prices would climb 10% that year. We all know what came next, well worth a read, hindsight is a wonderful thing

 

https://www.eyeonspain.com/spain-magazine/property-outlook.aspx

 

 

[HousePriceMania]

Can anyone explain this ?
 

 

[Boon]

Channel Islands include Jersey?

Doesn't seem realistic that in 2019 there would only be 4 listings.

Maybe the regular people's homes are for sale on another portal that isn't rightmove, because they didn't need to be. Getting buyers was real easy.
Today selling a house is harder so therefore the agents decided to cough up and go on RM so that more people could see it.

[HousePriceMania]

4 minutes ago, Boon said:

Channel Islands include Jersey?

Doesn't seem realistic that in 2019 there would only be 4 listings.

Maybe the regular people's homes are for sale on another portal that isn't rightmove, because they didn't need to be. Getting buyers was real easy.
Today selling a house is harder so therefore the agents decided to cough up and go on RM so that more people could see it.

Fair points, might be related to Brexit too.

End of 2019 there were 3/4 listings, since then it's been about 15-25.  

but it's been increasing steadily and I think a developer has unleashed loads of crappy new build luxury flats.

 

Edited February 27, 2023 by HousePriceMania

[Axeman123]

@HousePriceMania AIUI the Channel Islands is a place to incorporate a company or bank, not somewhere to physically live if you are seriously rich with no ties to the place. Most housing on the island would be for the well-paid legal and accounting professionals to serve that group IMO.

An uptick in sales could be as simple as either consolidation or efficiency savings within the legal/banking sector on the islands.

[Wight Flight]

18 minutes ago, Axeman123 said:

@HousePriceMania AIUI the Channel Islands is a place to incorporate a company or bank, not somewhere to physically live if you are seriously rich with no ties to the place. Most housing on the island would be for the well-paid legal and accounting professionals to serve that group IMO.

An uptick in sales could be as simple as either consolidation or efficiency savings within the legal/banking sector on the islands.

Not sure. A very wealthy acquaintance of mine retired there. He did instantly become one of the richest residents.

Another friend moved there at Christmas, and has gone from the richest man in his Welsh Village to decidedly average in Guernsey.

[roundhouse]

5 hours ago, Boon said:

Channel Islands include Jersey?

Doesn't seem realistic that in 2019 there would only be 4 listings.

Maybe the regular people's homes are for sale on another portal that isn't rightmove, because they didn't need to be. Getting buyers was real easy.
Today selling a house is harder so therefore the agents decided to cough up and go on RM so that more people could see it.

Unsure if still true, I think it is: There's two markets, locals and open. One is affordable (prices that we'd see as reasonable) for born/bred islanders, and the other for people who want to live there and will pay way over the odds for it.
Cornwall needs a locals market, if we get Housing devolved to the LA it might be brought in.

[roundhouse]

10 hours ago, AlfredTheLittle said:

I'm looking at the moment, asking prices still seem very high and houses are still selling, although there are lots that have been on for a couple of months. Estate agents seem fairly busy, for example I couldn't get a couple of viewings last Saturday that I tried to book a couple of days before. 

Hopefully there will be another decent interest rate rise in March, that might get things moving.

Seems same story here. Many more listed above my price band and not so many selling, but lower level fewer listed and still overpriced  but most go SSTC often before the month-later reduction.
I'm looking too... good luck AtL!

[Wight Flight]

57 minutes ago, roundhouse said:

Unsure if still true, I think it is: There's two markets, locals and open. One is affordable (prices that we'd see as reasonable) for born/bred islanders, and the other for people who want to live there and will pay way over the odds for it.
Cornwall needs a locals market, if we get Housing devolved to the LA it might be brought in.

I believe it is still true.

I would like them to declare that any new build here for at least the next five years could only be sold to locals (the council define that as five year residency)

Homes would therefore have to be sold at a price to fit local wages, which would hopefully bring down the cost of land.