I have recently seen a lovely house in Hillsborough which I really want.

It's on the market at £78,500. I know a couple of years back it was perfectly normal to offer a few grand less, but is it still reasonable to do this? Is there any chance of anyone accepting less? We are first time buyers and so obviously we are in a good position.

I bet I'll be on here in a few days saying it went for 90k+
:D

I guess it depends on the estate agent. Some in Sheffield seem to undervalue the house. We put in an offer £20,000 more than the guide price and still missed out.

Put it this way you can only get turned down, and then just put in a higher bid.

It's a risk. Could depend on the estate agent - some will put up a price about 10k lower than they expect, in order to stir up interest and get a bidding war going.
Find out how long it's been on the market...if it's been a long while...6 months or more, go for it.
Otherwise, you could go for it, but remember to call the agents at least every day in order to stay in the running if others start bidding. Otherwise they'll just drop you out of the loop.
It's all very scary, but well worth it. Good luck!

I don't see anything wrong with a putting forth a reasonable offer below the initial asking price. The asking price used to be a target price for the seller -- a price they would like, but would be willing to bargain down from. It seems that these days, the asking price is becoming a stepping off price for the seller, something that they consider the lowest possible amount they'd accept. Ultimately, a house is only worth what someone will pay for it, and if you feel it is worth, say, 75K, then that's what you should offer. House buying has always been a bit of bargaining, and as someone not involved in a chain, you are in a good position to bargain. I think that as long as your offer is not insulting, you should be fine.

I will say that it looks as though one of the rather large estate agents here in Sheffield is setting asking prices lower than the houses are worth to promote interest and bidding wars, which is shady to me, at best. I think buyers (we are first-time buyers, as well) are finding it hard to know what to do. We've been looking for a place to renovate, but are now considering buying land and building our own, which might be less hassle!

Good luck, steelblade!

Originally posted by cosywolf
It's a risk. Could depend on the estate agent - some will put up a price about 10k lower than they expect, in order to stir up interest and get a bidding war going.
Find out how long it's been on the market...if it's been a long while...6 months or more, go for it.
Otherwise, you could go for it, but remember to call the agents at least every day in order to stay in the running if others start bidding. Otherwise they'll just drop you out of the loop.
It's all very scary, but well worth it. Good luck!

LOL! I was saying the same thing, but you typed a lot faster! =)

B2B and I put in an offer on an amazing property that needed complete renovation -- I mean, roof, central heating, plumbing, walls, rewiring, everything. When we went in for our initial offer, the woman (who could not really have been less enthusiastic) told us that every property on their books was going for at least 10K over the asking price. I wondered why they didn't just adjust the asking prices accordingly, but whatever. We started off at 5K below the asking price, and were up to 20K over at the last stage of blind bidding. We still lost it, but that's life.

The thing that really bothered me was their appalling customer service. They told us that we needed to call every day and check what the bid was at (they wouldn't be forwarding any bids to the vendor til the blind bids at the end, which all seemed a bit pointless to me), as if they had to call everyone, they would be on the phone all day. But wouldn't they be on the phone just as much, if we were all calling them?

And now I have de-railed the topic. Sorry!

Of course you can ask below the asking price, but you may not get it.

When an estate agent values a house, it is his or her judgement and experience of the market in that area. There is no magic formula or calculation.

As cosy says if it has been on the market a while it means its overpriced.

If it generates lots of interest and sells quickly it is underpriced.

I am no economist but its all down to supply and demand theories.

If I was selling a house, I would always put it on the market a little low to get the interest up, but the estate agent just wants to sell it as quick as possible (they would be on a fixed price commission at this end of the market therefore it does not matter to them what the price is, if they are on a percentage of the sale price then they do have an interest in the sale price.)

xxxxxxxxxxx

Thanks for your replies, they have been really helpful.

Unfortunatly, as is usually the case, the estate agents hadn't updated their website and when I called today to book a viewing I was told the house had been sold.

It is infuriating that they don't bother to take sold houses from the website.

So I guess I'll keep on looking. Why oh why didn't I buy when I first started looking last year, when the same houses were 65k!!! argghhhhhh!!!! :D

Originally posted by huwj
Remeber you can always increase your offer but once you have made an offer and it is accepted you can't go back and ask for discount!! Not strictly right, the opposite of gazumping (a seller has agreed the sale but pulls out because someone else offers more) is called "gazundering". The buyer knowing the seller is fully committed and can't afford to pull out, comes in a few days before completion and says "sorry, can't get the money, accept £10k less or forget it". This is a risk with a cash buyer, no chain involved, if they don't get the house they can easily look for another.

Both practises are frowned on but I think still not illegal in England (in Scotland it's better in some respects, once you've signed the contract it is just that, binding, no way out for either party whatever happens).

Originally posted by steelblade
Unfortunatly, as is usually the case, the estate agents hadn't updated their website and when I called today to book a viewing I was told the house had been sold. Did you find out how much for?

No I was so miffed I didn't think to ask, perhaps I will phone back, just out of interest.

Get the Property Guide, rather than relying on their websites.
Better yet, visit them and see what they've got in. Could be some new things.

Originally posted by robh

Both practises are frowned on but I think still not illegal in England (in Scotland it's better in some respects, once you've signed the contract it is just that, binding, no way out for either party whatever happens).

Both in England or Scotland once you have signed contracts it is legal, what you are thinking is in Scotland once your offer is accepted it is legal.

From my experience if you see a property that you'd really like then offer the asking price. While you are offering a lower bid somebody else could have crept in and offered the asking price and pipped you to the post. Then if you still want the house the fun begins. ;)

The best thing to do is offer the asking price and request the house be taken off the market. If you don't, someone can come along a couple of days later and bid something higher.

When we bought our house just over 12 months ago we offered £3000 over the asking price on the condition the owners took it off the market.

They promptly did so!8)

Well I just bought the property guide today. There isn't a single house, in the area we want, that we can afford! Not a single blo0dy one.

It's really annoying. We want to move because of the problems we are having with our council property and well just because we'd like a nice home in a nice area without scummy parasites for neighbours, ruining our enjoyment of life.

We said we were going to wait, in the hope of some type of property crash but it just doesn't look like it's going to happen. Again in the paper today there is talk of how house prices are still rising, with South Yorkshire as one of the places to feel the rises most. Great!

I know it's a bit bad of me to hope for a crash but that is our only way of affording anything half decent.

We have started looking again anyway just out of curiosity although I'm worried we may take on a mortgage we can't afford just to get out of where we are now.

Xxxxxxxxxx

While the bank of englands base rate is at an all time low th house prices (in South Yorkshire especially) will continue to rise.

It all about supply and demand, there are more people wanting a house than there are houses available. Fact of life really!

Fed up...as fast as I save....house prices go up faster......I cant keep up. The particular type of house I am after in a certain area seems to rise in general pricing terms by about £3K a month....this is getting rediculous now....my dream house is just getting further and further away. I cant save £3K a month unless I sell my body.....

A house in the very street I was looking at just 12 months ago, identical to the one now on sale, has risen by a staggering £35K...my God when will it stop!!!!

Anyone else got any horror stories about chasing houses and just getting left behind by the rip-off inflationary market prices?

The only way I can have a house like this at the moment is to rent it and that is all totally dead money down the drain.....

There is a big difference between the present market value and actual worth of a property.

If interest rates were to rise steadily, the market would slow down - but knowing good old Labour they will keep it low, keep the housing market stable, but shaft you on another 20 different taxes somewhere else down the line.

Fantastic hey!

you are aware that the government gave up direct control of interest rates some time ago.
And that the latest predictions suggest interest rates will be at 5.5% by the end of they year, possibly higher?

It will either take a long while of 0 inflation for house prices to become reasonable again, or a sharp crash. Not sure which I'd prefer... If they crash I can buy a 2nd one. If they stay flat... then the value on this one stays flat. I think i'd rather they crashed and burned.

Originally posted by Cyclone
you are aware that the government gave up direct control of interest rates some time ago.
And that the latest predictions suggest interest rates will be at 5.5% by the end of they year, possibly higher?

It will either take a long while of 0 inflation for house prices to become reasonable again, or a sharp crash. Not sure which I'd prefer... If they crash I can buy a 2nd one. If they stay flat... then the value on this one stays flat. I think i'd rather they crashed and burned.

So in plain English, are you saying the forecast is good then for first time buyers? Are interest rates going to level off at some point/is the market going to crash??? I presume you've not lost the gist of the original question?

Originally posted by Blootiger
So in plain English, are you saying the forecast is good then for first time buyers? Are interest rates going to level off at some point/is the market going to crash??? I presume you've not lost the gist of the original question?

Even the experts can't agree on this, too many variables, a slow down seems the most logical viewpoint, but 'when' is another question.

The gov't may not have direct control over interest rates, but I dont think its too hard to see who pushes the buttons of the economy overall - directly or indirectly.

Early reports would suggest an near 1% increase in interest rates by the end of the year, to cool the market down - who knows.

People are fuelled into a house buying frenzy by the interest rates, the bank of england doesn't control the housing market - so the gov't have to push the buttons again.

its just so they dont get blamed if the ***** hits the fan. Bit like a PLC having a Ltd. as a supplier but both have the same directors.

not really. The BoE is independant and has only one target to hit (controlling overall inflation) by the use of interest rates. The government has a much broader target of keeping the economy healthy, and has more means to affect it, spending, taxing and borrowing.
Overall inflation is not massive, but the continuing strength in the housing market has already seen an increase in interest rates, and until inflation in housing is brought under control interest rates will continue to be raised.
To avoid causing a crash they are unlikely to jump by 2 or 3 %, but a steady rise over the rest of they year by at least 1% is likely. It won't have an immediate effect of course, i'm not sure, but I'd think it would take 6 months for the full impact to be visible.

So it's still not a great outlook for first time buyers. A soft landing in the market means that prices will stabilise rather than fall. It might mean you can finally catch up with them in terms of saving the deposit, but it's still going to cost you twice as much to buy a house today as it cost 3 years ago.

Is this frenzy of house buying happening in the rest of Europe? Specifically those enjoying the lower interest rates in the Euro zone which is currently around 2%?

Surely with interest rates, and consequently mortgage rates, half of what they are in the UK we should be seeing faster house prcie rises 'over there'. Anyone know if this is true?

This is probably a stupid/hopeful question, but can you take out mortgages/ loans with European banks and enjoy the low interest rates?

Originally posted by t020
This is probably a stupid/hopeful question, but can you take out mortgages/ loans with European banks and enjoy the low interest rates?

You'd carry a big exchange rate risk though.

Originally posted by t020
This is probably a stupid/hopeful question, but can you take out mortgages/ loans with European banks and enjoy the low interest rates?

I know you can if you buy a house abroad but haven't really looked into it for buying in this country.

Originally posted by max
Is this frenzy of house buying happening in the rest of Europe? Specifically those enjoying the lower interest rates in the Euro zone which is currently around 2%?

Surely with interest rates, and consequently mortgage rates, half of what they are in the UK we should be seeing faster house prcie rises 'over there'. Anyone know if this is true?


Mainland Europe is probably seeing worse, especially in tourist areas, as it's not only us Brits buying a place in the sun.

IMHO....

I'm of the opinion that it will crash/slow down within the next couple of years. This can only be defined as a bubble, the same as the internet stock boom a few years ago where some people made HUGE amounts of money (I had a good time then as well :-) ). Greed blinded the better judgement of those who should have known better, and they ignored the warnings of wiser heads who said the bubble would eventually burst.

No one knew when it was going to pop and what would cause it... Boo.com went bust then everyone questioned whether these stocks were really worth it. It was a herd thing.. everyone started selling and it went into freefall. The FTSE halved in value and hasn't risen anywhere near the 2000 peak since.

As regards the property market - I think it's also a social psychology/confidence thing. A mate of mine thinks the boom is partly fuelled by those TV makeover programmes! It also doesn't matter that first time buyers can't afford to jump on the ladder, the lower end of the market is being serviced by people buying 2nd buy-to-let properties.

People are bullish about property at the moment.. but there are a number of things that can make them bearish (interest rates, the euro, the economy). When that happens I think we're gonna see some hefty corrections.

And I've just bought a property myself!

Originally posted by t020
This is probably a stupid/hopeful question, but can you take out mortgages/ loans with European banks and enjoy the low interest rates?
I've heard you can but not sure of the penalties involved in setting it up.

If you find out, let me know the actual details.

Mainland Europeans have different house buying patterns and attitudes, I know when I was in Germany it was actually much less common to own your own house and more common to rent, so I doubt it's had such an effect as here.

Plus they don't have the same houseage shortage as us which of course drives prices up.

Originally posted by t020
This is probably a stupid/hopeful question, but can you take out mortgages/ loans with European banks and enjoy the low interest rates?

yes you can, you need to have some sort of address in the country though and a lot of verification that you can pay etc. they will want to see all you banking arrangements and will request them from the banks in England. The banks in England will provide them for a fee as you are not obtaining the loan with them.

So, in theory you need quite a bit of capital to start with to aquire the accomodation abroad. If you have this then why would you bother trying to get the mortgage for a property here. I suppose in the end it all equates to the same outcome. Paying a lot. Also if it was that easy, Blimey wouldn't we all be doing it.

Originally posted by t020
This is probably a stupid/hopeful question, but can you take out mortgages/ loans with European banks and enjoy the low interest rates?
Yes you can, but it's really only geared towards commercial property and projects.

I don't honestly think that it will crash, and my living depends on it! We know far more about how to control the market than we did even 10 years ago. Does anyone remember Summer 1999 when we thought that everything was going to go pop? Well it didn't because we have a much more stable national and world economy.

Finance is much more sophisticated now than it has ever been, and believe me, banks don't like losing money!

There are many many other ways of controlling house price inflation. Interest rates are a sledgehammer to crack a nut and the BoE and the Government know this. There will be no crash in the next 12 months because of elections. 12 months is more than enough time to introduce new ideas to calm people down.

Here are a few ideas...
-VAT rationalisation
-Local taxes
-Windfall tax on property
-Increased death duties
-Adjustment of stamp duty bands and rates

House (spacious 3 bedroom terrace) was bought in Walkley area as a "buy to let" one year on the person is selling it.

It was originally bought for approx £92,000 .....

....one year on, since Mervyn (bank of England boss) gave his speech the house went on sale with an asking price of £94,000. 20 viewings have been made and one person put in an offer of £90,000....but withdrew it. The current offer is £75,000 and NO ONE ELSE has put in any offers. A few months ago this house would have had 60 viewings and loads of offers withing 2 weeks it would have been sold....so if this is not an indication of a house price crash.....what is????

I live in Sharrow. I brought my house for 45.000 2 years ago. The houses on my road are now going for 110.000-125.000.
Crazy.

I think one house not selling very well is anything to go by. Only last week a house on my street went for £15k over the asking price within a week of going on sale..and thats in Lower Walkley.
Maybe the house in question is a sh*thole???
To be fair £94,000 seems quite cheap anyway for a house in Walkley given the current market. I would suspect that there is simply something not right about the house

I hope it crashes, in just under a year. That would be perfect for me! Sorry anyone else-hehe!

But surely if it crashes then people won't be selling..less choice

that's my thoughts. wish I hadn't been a student a few years ago, now I can't afford to buy and if it crashed no one would be selling so there'd be nothing to buy.

we can't have everything :(

But I will be actually afford soemthing when I graduate, at the moment I shall be residing in a box

There's no evidence of anything like a crash as far as I can see. Quite the opposite.

What you will find I think is developments coming along aimed at first time buyers. Thatmight help a bit.

Oh pleeeeease let the prices crash.
Where is this house in Walkley? its where we want to buy but done have a hope at the moment coz of the prices and being on crap wages but that one sounds like a possibility even if it is a **** hole we could do it up:)

Not crashing yet - house opposite went really quickly. House next to one we sold for 98,000 is on for 125,000 in x-pool - smaller than ours (although didn't have hideous kitchen!) and that's just in 2 years!

I can't see any reason why houses should have quadrupled in price in the last 5 years (as they have in many areas of Sheffield) other than speculation and too much cheap money.

A house is worth what someone is willing to pay for it, no more, no less.

Anyone with more than 85% owing on their house should be prepared to sit out the crash that is inevitably coming because prices will rise again.....but not for a few years. Easier said than done.............

Originally posted by carcrash
I live in Sharrow. I brought my house for 45.000 2 years ago. The houses on my road are now going for 110.000-125.000.
Crazy.

Round our area you wouldn't get a cardboard box. £175-£180,000 for a 3 bed semi and this is in a poohish area!

Alex

As usual, Sheffield is just catching up with the rest of the country on prices. It always has done - it may well always do. That's why prices don't ever crash in Sheffield.

Just think of like a price-preserving bubble.

Originally posted by wibbles
I think one house not selling very well is anything to go by. Only last week a house on my street went for £15k over the asking price within a week of going on sale..and thats in Lower Walkley.
Maybe the house in question is a sh*thole???
To be fair £94,000 seems quite cheap anyway for a house in Walkley given the current market. I would suspect that there is simply something not right about the house

Actually it is far from a "sh*thole

Originally posted by Tony
There's no evidence of anything like a crash as far as I can see. Quite the opposite.

What you will find I think is developments coming along aimed at first time buyers. Thatmight help a bit.

House prices at the moment are totally unsustatainable..

Perhaps you could generate some interest by pointing out which estate agent is advertising the house.

House prices won't crash, believe me. They may dip slightly, but what will happen is a market slowdown, with prices rising slowly over the next few years. Sheffield and surrounding areas are very desirable places to live, there is a housing shortage, factors like these will also help to keep prices where they are.

I tend to agree. I reckon that Sheffield house prices at worst will plateau. Houses here are still way cheaper than in the South and as long as that massive pricing and cost of living disparity between North and South exists, you'll not have a crash in the North.

My 2p FWIW.

-Armin

I haven't seen any evidence of a price crash in Sheffield yet. My colleague has just sold his smallish 3 bed semi in Greystones for £216k, the asking price was £175k. What happens in London usually ripples out to the rest of the country and indeed some prices in London have dropped, particularly at the very top end of the market (£1M+) but this happens every year at this time, they will go up again in January as City bonuses are paid in December. The very high values of these houses makes them have a disportionate influence on overall price fluctuations. Decent family homes down there are holding their values and have increased by about 6% since January. I don't expect to see prices in Sheffield drop much if at all, but the rise will plateau and stay consistent for quite some time to come. This, of course, presumes no massive economic shocks.

Originally posted by Nick
This, of course, presumes no massive economic shocks.
Well it seems that even a 5 billion pound war doesn't even cause a ripple any more!

Things are a lot more stable, and the Government / Bank of England effort at taking a little steam out of the market quickly has been done very efficiently and nobody spotted what was really going on ;)

I think that (as an economy) we're learning how to handle the markets better and keep things stable.

I honestly don't see it changing a deal... and in any case, Sheffield is always pretty immune to drastic fluctuations because there simply isn't the wealth to support the high prices seen elsewhere.

Originally posted by Miss_60
House prices at the moment are totally unsustatainable..

Why?

The thing that sustains house prices is demand and willingness to pay the asking price.

All these people deperate for a crash so they can jump on the ladder shows that demand is still there. If those people got a jump in salary and were able to afford the current asking prices, I'd guess they'd pay what's being asked.

If Sheffield attracts lots of new business (and Civil Service relocations!) and the local economy booms a bit, then Sheffield will be fine, regardless of what happens nationally. My london friends still gasp at how much I'm buying my 3 bedroom place for here... less than HALF of what they would expect to pay in a pretty non-descript part of the capital.

Zeddy

the whole thing about a speculative bubble is that it always goes on longer than everyone expects (enticing more and more people in who think the only way is up).
If you can't see any evidence of a crash does that mean one isn't coming?
There isn't much warning when a bubble bursts......

It is totally unsustainable.

If anyone reads the Property guide ...even estate agents AND banks who have a personal interest in house prices remaining high have said that looks as if there is going to be a crash....plus interest rates will most likely be increased again next month.

OK then.. lets lok at it another way.

If prices are 'too high' (which they aren't in Sheffield) do you suppose that people who are selling in the future will accept less than they have paid? Of course not.

Property 'crashes' just don't exist, they dont happen and never have done.

What happens is that demand slows and prices increases stop / stabilise. A limited number of people may suffer from negative equity for a short while, but this passes very quickly (and in Sheffield it doesn't happen anyway).

There are only 2 commodities that everyone needs, food and housing. They are the most stable things in our economy and while competition is the only thing that affects prices.

Food becomes cheaper because we all need it but don't have it. We need to buy it often from organised 3rd parties (shops) which introduces opportunity for retailers to create competition. There is 'elasticity' in the price.

Property is something we all have and all want. The distribution network is too diverse to be led by anything other than demand because it is made up of lots of individual sellers, not a limited number of shops. That's why property prices always go up - there is no elasticity.

A HOUSE PRICE CRASH IS COMING.

A number of newspapers are reporting that house prices are starting to fall! Here are the links to some examples:

http://www.timesonline.co.uk/article/0,,2-1150538,00.html

http://property.timesonline.co.uk/article/0,,14029-1154159,00.html

In these articles are quotes from people who do not think that there will be a crash. However, as this next article points out, THESE PEOPLE HAVE A VESTED INTEREST IN A CRASH NOT HAPPENING. THEY WERE SAYING THE SAME THINGS BEFORE THE LAST HOUSE PRICE CRASH. SEE HERE:

http://property.telegraph.co.uk/property/main.jhtml?xml=/property/2003/09/17/prosy17.xml&sSheet=/property/2003/09/17/ixpmain01.html

INDEPENDENT EXPERTS ARE PREDICTING BIG PRICE FALLS. SEE THESE LINKS:

http://www.thisislondon.co.uk/news/business/articles/timid79314?source

http://observer.guardian.co.uk/focus/story/0,6903,1243305,00.html

Mervyn King, the Governor of the Bank of England has given the most obvious warning that he is allowed to, that the crash is coming – and he has now said it TWICE!

http://news.bbc.co.uk/1/hi/business/3806961.stm

http://news.bbc.co.uk/1/hi/business/3836021.stm

The Governor of the Bank of England can’t just come out and say that a crash is coming, because this would start one. He would not be making these warnings for the fun of it.

King’s warnings seem to be filtering through to househunters. More and more now expect house prices to fall. In January, only 1 in 10 househunters thought house prices would fall in the next 12 months, now it is more than 1 in 3.

http://www.thisislondon.co.uk/news/business/articles/timid80270?source=

Originally posted by Tony
OK then.. lets lok at it another way.

If prices are 'too high' (which they aren't in Sheffield) do you suppose that people who are selling in the future will accept less than they have paid? Of course not.


Not just about that though is it Tony? It also depends how stretched people are paying their mortgages now, if rates rise, and things become less affordable, those without a buffer will suffer the problems of repayment.

I dont think there will be a 'crash' as such, but definately a decline or readjustment as its called. Sheffield has just come up to whats its housing stock is worth, but those people paying well over asking etc may find differently later on.

You will find as in the property crash of the 80's/90's people don't have to sell, because their houses actually get reposessed when payments are not met.

Never think that you might not have to sell for less than you bought.... bit like currency exchange, the people oiling the cogs of the market know when it needs to be done.

Buy, yes... but buy cautiously and sensibly.

Originally posted by 1Man&hisBMW
I dont think there will be a 'crash' as such, but definately a decline or readjustment as its called. Sheffield has just come up to whats its housing stock is worth, but those people paying well over asking etc may find differently later on.

That's exactly the point. Having bought a house at the height of the market in 1991 and sold in the depths of 1994 I had that experience. That particular experience was that we paid £42k for a house in a direct deal, and sold it for £56k 2 1/2 years later. We bought sensibly and sold sensibly. It took 4 months to sell ours and there were people around us who had paid £57k for the same property.

In those circumstances people just stay put. Demand falls. Price averages stabilise and the whole thing generally calms down. The prices for those same properties now are selling for £130k. Property is as long term investment. It outperforms EVERY other investment sector over the long term. It will always do so.

Additionally, I still maintain that Sheffield is almost immune to major fluctuations, even at the moment.

Originally posted by Tony
That's exactly the point. Having bought a house at the height of the market in 1991 and sold in the depths of 1994 I had that experience. That particular experience was that we paid £42k for a house in a direct deal, and sold it for £56k 2 1/2 years later. We bought sensibly and sold sensibly. It took 4 months to sell ours and there were people around us who had paid £57k for the same property.

In those circumstances people just stay put. Demand falls. Price averages stabilise and the whole thing generally calms down. The prices for those same properties now are selling for £130k. Property is as long term investment. It outperforms EVERY other investment sector over the long term. It will always do so.

Additionally, I still maintain that Sheffield is almost immune to major fluctuations, even at the moment.


Tony

I see where you are coming from, but its still the 'buying sensibly' which most people are not doing. This x-amount over asking etc is going beyond funny, and it just means that the tax you pay, the mortgage, etc all increases.

I just hope people keep theirs senses about them when buying..

You are right of course. That's the reason why the BoE and the Government have led the lazy media by the nose to create a little dampener - and you can see the results.

There is no benefit to anyone of price falling, and interest rates are still puny in all honesty. However, people need a little jolt every now and again to remind them not to be silly.

There is a NATIONAL housing shortage, not an oversupply (that's part of the reason why apartments will continue to thrive). Lending is cheap. People are pricing themselves out of the market, that's all that needs adjusting, and it's happening.

I think a lot of these points are valid, especially about property being a long term investment. However although it is a long term investment it usually only benefits people after you die.

Because usually to realise the equity in your investment you either have to downsize (move to a tent in this current housing boom) or leave this existence.

There is also the buy to let factor. I think that a lot of people have rushed to the buy to let market.

With this in mind if interest rates do go up and people cannot fill properties with tenants (due to varying reasons competition, new housing stock & high rents), then they may become stretched and therefore have to release this property back into the general market.

This may lead to an adjustment in the current housing price boom!!

Originally posted by zorba
There is also the buy to let factor. I think that a lot of people have rushed to the buy to let market.

With this in mind if interest rates do go up and people cannot fill properties with tenants (due to varying reasons competition, new housing stock & high rents), then they may become stretched and therefore have to release this property back into the general market.
That's another very valid point. However, you must bare in mind that many, many people have worked out that it's more profitable to buy a property, pay the mortgage and get the capital growth than to give £500 a month to a pension company - even if they have no tenant! It's not so much 'buy to let' as buying your pension.

A few people might stuggle if they don't have tenants and they don't have other income to cover a mortgage, but as pretty much everything in Sheffield is let that's some time off.

Don't forgot a big slice is consumed by CGT when you sell your buy to let property or 2nd home. Take that into account it is no where near as profitable as stepping up the ladder at the right time using your own home.

Just came across this article may prove a bit of interesting reading.

http://www.iii.co.uk/insider/index.epl?type=editorial&editorial_type=&id=31812&archive=!1&section_id=30520

This is the point. There is a shortage of housing!!!

however, an acute shortage of land and housing in Japan and Hong Kong didn't stop property prices falling 50% and more when the bubble burst.

I lived in Hong Kong and that had nothing to do with over inflated prices, it was all to do with fears about the china handback. Companies left HK, people left HK cos their jobs went and the property became less desirable. Not an overinflated price issue.

:loopy:

Originally posted by neilaw
I lived in Hong Kong and that had nothing to do with over inflated prices, it was all to do with fears about the china handback. Companies left HK, people left HK cos their jobs went and the property became less desirable. Not an overinflated price issue.

:loopy:

so what you are saying is there was a reason the bubble burst ie. the Chinese handover. Not sure what you are arguing (other than that I am mad, which I will accept)

Did you live in Japan as well?

He beat me to it:)

Whilst there is never a guarantee, what happened in Japan and HK was, as suggested, more to do with the economy than prices.

Prices are only 'over-inflated' when people can't afford them. Then they just stop buying. They don't go down though.

However, when there is no-one to buy (because of other factors), then prices can fall, ie HK and Japan.

Sheffield prices are still very affordable. The only gap in the market is in first time buyers homes, and this is being addressed in new developments being planned.

The housing market is a living entity and it constantly adjusts itself according to demand.

So increasing interest rates, increasing insolvency rates, decreasing rental yields, record debt levels and very low income growth (to name a few) are not economic factors?

House prices cannot be viewed as affordable if there is a shortage of housing for first time buyers. If affordable housing is built for first time buyers, how will they then be able to move up the ladder? If the price of their house goes up it will then be too high for the next generation of first time buyers. So then, following you logic, a whole new development of first time buyer houses have to be built.

Why can't house prices go down? If people 'stop buying' what happens to the people that HAVE to move due to relocation, inability to keep up mortgage payments etc. Once the speculators move on, who will buy these houses if the prices stay the same.

Everyone has their views, but they generally suit their circumstances. Hence, estate agents will tell you that prices won't crash.
Unless, that is, you are selling. Then they suggest that its the time to sell.

Increasing interest rates et al, will not cause a crash unless they reach catastrophic levels as per the late 80's. All they will do is slow the rise in prices. A crash will only ever occur at a national level, not regional. Prices exceeding peoples ability to buy into the market has never ever caused a price crash, only national economic conditions can do that and as the economy is strong that wont happen.

People either downsize their expectations as can be seen in London, i.e. they buy a one bedroom rather than two, or they rent.

Developers then follow suit and start to build more one/two bed flats than houses.

House crash talk about sheffield is total nonsense, it may slow but wont crash.

Look, you're not especially wrong, and much of what you say has merit, but you're missing the point.

The market will adjust itself as it always has. It has NEVER crashed. I see no reason why it’s going to start now. We have even learned how to maintain the stock market on an even keel since the highs and lows of the late 80’s. The current doom and gloom has been manufactured by the Government to stabilise price inflation. It’s worked!

Housing in Sheffield (as I said before) is very affordable when compared to other areas of the country. The perceived lack of FTB property is less of an issue than in the past because the rental market takes care of this to a much larger degree than it did before - and that allows the bottom rung of the ownership ladder to move up.

Many FTB'rs are now older, wealthier, etc. That's maybe not going to suit everyone, but it's just an example of how the market adjusts continually.

New FTB products are being developed that will offer further choice and diversity such as small studio starter apartments or shared ownership.

Mass property ownership is a post-war phenomenon. Before then most people lived in rented housing. Before that, they lived in tied housing. Just more examples of how it changes with the circumstances of the time.

When did you last see new housing estates going unsold?

last time the market crashed i had to sell a house in west yorkshire for the same price i sold it for despite having done a a few grand worth of work on it.

I don't think prices will fall that much here - but they might just freeze - which means people struggle to find the cash to pay estate agencers conveyancers and stamp and no-one can afford to move - so everyone just stays put!

However i think some buy to let speculators might well get bit hard and have to sell cheap!

It seems that the housing bibble has burst. See

http://www.thisismoney.com/20040720/nm80558.html

What do others think?

Been done!!!

http://www.sheffieldforum.co.uk/showthread.php?s=&threadid=13711

Ah man, first ever thread snubbed.

Gutted!

Whats been done? So people only discuss things once and then thats it?

So I've got to dream up a topic that hasn't been discussed before?


I thought this was a discussion forum. Obviously not.

Gutted. No.

Think that was more, continue that thread rather than don't discuss it.

Unfortunately, this illustrates the mentality of a lot of people who post in this forum. They are very quick to shoot someone down..this is the reason why I very rarely bother with this forum....there are many small minded poeple in here and its far too political.

Before you start whining the point made was that this subject has been covered elsewhere and hence the threads have been rightly merged. Thats why the link to the original post was shown. No one is denying you the right to comment..in fact feel free. No one is shooting anyone down by stating the obvious...some people are so over sensitive

Originally posted by wibbles
Before you start whining the point made was that this subject has been covered elsewhere and hence the threads have been rightly merged. Thats why the link to the original post was shown. No one is denying you the right to comment..in fact feel free. No one is shooting anyone down by stating the obvious...some people are so over sensitive

WHATEVER!

Originally posted by Miss_60
WHATEVER!
:shakes: :huh:....mm..very in depth, constructive comment. Thanks for sharing that with us all
:thumbsup:

Originally posted by wibbles
:shakes: :huh:....mm..very in depth, constructive comment. Thanks for sharing that with us all
:thumbsup:

you aint worth it thats why :loopy:

Originally posted by Miss_60
you aint worth it thats why :loopy:
Take a chill pill.

Anyways... we were talking about a house price crash? I don't see it. I see some stagnation down the road, but that's about it. Comments?

Originally posted by armin
Take a chill pill.

Anyways... we were talking about a house price crash? I don't see it. I see some stagnation down the road, but that's about it. Comments?
I agree...a slowdown is inevitable but its never likely to crash. As a country we are more economically stable and can handle most things that may affect house prices. A lot of people are confusing a slow down with a possible crash.

a bit of news for the people looking for a price crash...
holmwood house on corthworth road was put up for sale in May for £3million. it's in today's property guide for £2.45million.

Well that's not bad seeing as it was sold about 3 years ago for half that.

the current owners did have to turn it into residential accommodation from offices though - must have cost an arm and a leg. i reckon they aint made too much. and the owners are no longer relocating, so maybe they'll withdraw sale...?

I think Miss_60 your taking comments a little too personally. Maybe that's why you don't bother with this forum very often.

House prices will drop at some point, historically sheffield has a softer up and down than most other places. Personally I hope they crash, i'll go out and buy a few if they do.

Originally posted by Cyclone
I think Miss_60 your taking comments a little too personally. Maybe that's why you don't bother with this forum very often.

House prices will drop at some point, historically sheffield has a softer up and down than most other places. Personally I hope they crash, i'll go out and buy a few if they do.

Er..I don't think I do. I don't bother with this forum much because some of the comments on some of the topics have been very offensive in the past.

maybe they weren't meant offensively and you took them too seriously?

Hi Folks

The house prices are slowing down, anyone else telling you different is usually some Estate agent on TV, producing a false economy, as by doing so, they keep the market inflated, and their cut!

House prices in Sheffield hallam are still increasing, but it is slowing down at last.

As a pointer, Sheffield Hallam in the second most affluent place to live in Britain, Cheshire been the first, And Kensington the third!

Now back to facts, House prices ususally spread from London, it can take a year or so, but what ever happens there, spreads outwardsa and usually affects the rest of us as some point. When the house prices went up down south two years ago, I moved from down there to buy in Sheffield!

In two years my home as doubled in price and a bit more, but not having a mortgage, I would never sell, I have everything I need , 3 miles of countryside in front of my home and great neighbours!

Now, after visiting friends in Kensington only last month, their house prices have declined by 10% in the last year, some people cannot even get a viewing!

Others are reluctant to sell, because there is no more deals or advantage to be gained my moving to a cheaper area, because they are all nearly the same price. So less homes are available.

But still the prices have dropped. The reverse pattern is happening now, who would move into a polluted city like London(4 times more polluted than Sheffield), pay the same cost for the property as someone in Sheffield, without the pollution, The peak National park on your doorstep, you would have to be a fool to live down south nowdays!

Why do you think that many soputherners have moved to somewhere like Sheffield, one of the greenest cities in Europe!

Excellent Universities, pollution free, great countryside, great sports facilities, great social amenities, the list is endless!

Thats why I came back to Sheffield, I would never live down south again!

Back to the ripple effect, the prices have dropped in London, they will now drop up here, its just a matter of time, but it will happen!

We cannot buy what we cannot afford collectively, hence 50 year mortages are now avaiable!

The average mans wage in this country cannot support a family and wife, plus a mortgage on his earning alone, this maddness has to stop!

Its not fair for the people wishing to start a family, unable to do so because of financial pressure of Mortgages, or one of the partners in the marriage having to give up work to look after the children.

The excess in spending has increased, alot of people have soldtheir homes to downsize, buy something cheaper, as they have excess revenue from the sales of their homes, new cars, holidays ,clothes have been bought!

The increase of cost of a home in Britain has increased spending indirectly,and as self perpetuated and fueled the inflation of homes even further!

I have no mortgage, so unless my home is more than halfed when the prices do drop, I am sitting pretty, if they drop, I can always sell mine, relocate and buy like for like, because they all have dropped!

But for the people who have mortgages, if they have borrowed 300,000 for a home, and it drops, they can never sell to regain that lost of original cost!

I was told by my Neighbours down south, that if I moved to Sheffield, I could never come back, I would never be able to afford to come back, because at that time the house was climbing in price!

I did not take their word for it, I just started reading the economist, with expert knowledge at hand, My property has doubled in Sheffield in the last two years, have the properties in London, I think not!

Looks like people could learn a lesson here, don't think that property always increases, its crashed a few times in the last 30 years!

Oh you say, it picks itself back up, it may do, but do you want to have a £100,000 mortgage and find out your homes only worth 70,000 for the next 8 years, that could easily happen!

What we do in life, echoes in Eternity<The Gladitor>

Regards

Mark ..

PS any of my neighbours reading this, I would never ever want to come back,it would be the last choice on earth, burst your bubble and go and look at the beauty in the rest of this country, oh, and feed the rats, they will be starving now I have left!

unfortunately all your passion doesnt result in any factual evidence.

Hi Folks

The house prices are slowing down, anyone else telling you different is usually some Estate agent on TV, producing a false economy, as by doing so, they keep the market inflated, and their cut!

House prices in Sheffield hallam are still increasing, but it is slowing down at last. **** Not True, check the month on month house price inflation on an informed website ****

As a pointer, Sheffield Hallam in the second most affluent place to live in Britain, Cheshire been the first, And Kensington the third!

Now back to facts, House prices ususally spread from London, it can take a year or so, but what ever happens there, spreads outwardsa and usually affects the rest of us as some point. When the house prices went up down south two years ago, I moved from down there to buy in Sheffield! **** Not True, where did you get this interesting fact from? ****

In two years my home as doubled in price and a bit more, but not having a mortgage, I would never sell, I have everything I need , 3 miles of countryside in front of my home and great neighbours!

Now, after visiting friends in Kensington only last month, their house prices have declined by 10% in the last year, some people cannot even get a viewing! **** yes, but this only affects the upper 2% of properties, it has no bearing on the average family trying to get onto the ladder, it is therefore irrelevant ****

Others are reluctant to sell, because there is no more deals or advantage to be gained my moving to a cheaper area, because they are all nearly the same price. So less homes are available.
**** utter rubbish, there are cheaper areas and always will be, everyone just moves up a notch. There are more and more and more homes coming onto the market week on week ****

But still the prices have dropped. The reverse pattern is happening now, who would move into a polluted city like London(4 times more polluted than Sheffield), pay the same cost for the property as someone in Sheffield, without the pollution, The peak National park on your doorstep, you would have to be a fool to live down south nowdays! **** If you have to live in London due to employment you have little choice. Most people wouldnt if they had a choice, get a grip on reality ****

Why do you think that many soputherners have moved to somewhere like Sheffield, one of the greenest cities in Europe!
**** fortunately companies are creating a booming economy in Sheffield due to its regeneration. People are now moving to new jobs and buying homes in a previously run down city. You cant have it both ways, create jobs and invest money and you get an upward curve in house prices as people jockey for new homes ****

Excellent Universities, pollution free, great countryside, great sports facilities, great social amenities, the list is endless!

Thats why I came back to Sheffield, I would never live down south again!

Back to the ripple effect, the prices have dropped in London, they will now drop up here, its just a matter of time, but it will happen!
**** rubbish, prove it, show some evidence from somewhere that this is a definite, bet you cant!
****
We cannot buy what we cannot afford collectively, hence 50 year mortages are now avaiable!

The average mans wage in this country cannot support a family and wife, plus a mortgage on his earning alone, this maddness has to stop! **** really, who's evidence, whats an average man? ****

Its not fair for the people wishing to start a family, unable to do so because of financial pressure of Mortgages, or one of the partners in the marriage having to give up work to look after the children. **** people shouldnt have children until they can financially support a family, isnt that common sense ****

The excess in spending has increased, alot of people have soldtheir homes to downsize, buy something cheaper, as they have excess revenue from the sales of their homes, new cars, holidays ,clothes have been bought! **** prove it ****

The increase of cost of a home in Britain has increased spending indirectly,and as self perpetuated and fueled the inflation of homes even further! **** not true, the lack of homes in desirable areas has driven prices up, why would a house being valued at more increase spending. non-sensical sentence ****

I have no mortgage, so unless my home is more than halfed when the prices do drop, I am sitting pretty, if they drop, I can always sell mine, relocate and buy like for like, because they all have dropped!

But for the people who have mortgages, if they have borrowed 300,000 for a home, and it drops, they can never sell to regain that lost of original cost! **** Like shares, if you dont have to sell at a loss then dont, there will be people that get the negative trap if the prices do drop (which I dont believe they will), with redundancy, bereavement etc. That is sad ****

I was told by my Neighbours down south, that if I moved to Sheffield, I could never come back, I would never be able to afford to come back, because at that time the house was climbing in price!

I did not take their word for it, I just started reading the economist, with expert knowledge at hand, My property has doubled in Sheffield in the last two years, have the properties in London, I think not!

Looks like people could learn a lesson here, don't think that property always increases, its crashed a few times in the last 30 years! **** IT does, every seven years, FACT ****

Oh you say, it picks itself back up, it may do, but do you want to have a £100,000 mortgage and find out your homes only worth 70,000 for the next 8 years, that could easily happen! **** rubbish, 7 years it doubles regardless, look at historic economics for the proof ****

Property doubles every seven years FACT.

apart from that time when it didn't.

No seriously, historically property has been a good investment. but it does have ups and downs. Also historically we have softer ups and downs here than in the south.

But you still don't want to be stretching to get your next (or first) house just as it peaks and swings into a short term down. Especially if that short term down is caused through high inflation and high interest rates, the first being unwanted, the 2nd being deliberate with the intention of cooling off the housing bubble.

Basic economics tells us that the price of housing cannot continue to rise indefinitely out of line with the rest of the economy. Not without squeezing more and more people out of the market and thus actually slowing it's own rate of growth, it's just supply and demand people.

Interestingly much of europe has a very different housing market to the uk, for some reason we are fixated on owning our homes, probably because it appears to work out cheaper in the long run.
In other european countries people are far more likely to rent, and there is less social pressure to own property.
The way things are going at the moment we could be about to see a shift towards that model as young people find themselves unable to buy but able to rent.

IANAE (I am not an economist).

Just spotted these articles thought they may be of interest ?

http://www.sky.com/skynews/article/0,,30000-13178959,00.html

http://news.bbc.co.uk/1/hi/business/3533824.stm

did u read the article and notice this point:

"The exceptions were the North, North West, Yorkshire and Humberside, as well as the South East."

Hi Neilaw

Wheres your evidence to prove your correct in telling me that I'am incorrect?

My evidence is below, sorry, I though everyone was up to date on the facts, but just for you Neilaw, heres the links to educate and fill that void!

As rightmove clearly states, the house prices are dropping, yet building societies are wrongly indicating that the market is increasing, just like I stated!

The links are there, its ashame you cannot practice what you preach, wheres your proof to state otherwise

http://www.sky.com/skynews/article/...3178959,00.html

http://news.bbc.co.uk/1/hi/business/3533824.stm

Honestly, how can anyone take you seriously!

Oh some more>
Proof of ripple effect!

http://www.themovechannel.com/sitefeatures/uk-house-prices/december-2002-nationwide.asp

http://ideas.repec.org/a/taf/apeclt/v10y2003i13p849-51.html

Proof of drops in London properties below the 10% as I claimed in my post>

http://money.independent.co.uk/property/homes/story.jsp?story=366017

Or try the links in the box at this link, proof that prices are indeed dropping!

http://pub37.bravenet.com/forum/3174956598/show/356470

I rest my case! LOL

Some people need you to do all the work and provide all the evidence, yet provide none to say you are incorrect, although they tell you you are incorrect!

Its also worth noting that it was only until about 1986, that it became feasible to have a shorthold tenacy agreement, and until then, property as an investment was usually let, and valued at around 50% of its total if uninhabited. As investments were long standing, in the region of 15 years, it seemed that the only way of maintaining maintenance costs and repairs over this period ands make some profit, was to rent the property out!

After 1986, the STA meant you could remove someone quite quickly, so sell your property at its true worth!

http://www.themovechannel.com/howto/let/risks-property-investment.asp

It begs logic!

LOL



ROFLMAOAY

Mark ..

I would have just barred you from the forum!

Please don't post what LOL means LOL

#'PS for those who really think that house prices always increase, and this must mean above the retail price index, then why does not the big banks and money lenders just buy property? Why not all the banks in London buying the properties several years ago, when the market was accelerating? Why not now ?

People seem to forget that wages also increase, and that for most, mortgages are needed to purchase properties!

Property does not always increase above earning potential of the average worker as a percentage, but currently, just the opposite!

Its ashame most are not thinking of who is going to be able to afford properties in the future, your property will only ever be worth what someone is prepared to pay for it!

you would have barred him for quoting part of an article you linked. I'm glad you're not a mod.

All you reference points are out of date, none for 2004! doesnt that tell you something? PS- did u notice the subtle point that prices in the North and Yorkshire buck the trend which is what we are discussing :loopy:

get a grip

Originally posted by neilaw
did u notice the subtle point that prices in the North and Yorkshire buck the trend which is what we are discussing

Fair point. This is, after all, in the Sheffield Chat forum so let's try and keep this related to Sheffield house prices. In which case I, for one, have never noticed a price crash in Sheffield and I've been watching prices for 30 years.

Anyone out there that has any proof otherwise please post on here but in the meantime I'd say we seem to be pretty secure here in Sheffield.

Originally posted by Howy
#'PS for those who really think that house prices always increase, and this must mean above the retail price index, then why does not the big banks and money lenders just buy property? Why not all the banks in London buying the properties several years ago, when the market was accelerating? Why not now ?
They do, and continue to do so, along with all the insurance, assurance and pension companies.

Such a basic lack of knowledge rather calls into question any analysis that you provide to us.

Originally posted by Howy


#'PS for those who really think that house prices always increase, and this must mean above the retail price index, then why does not the big banks and money lenders just buy property? Why not all the banks in London buying the properties several years ago, when the market was accelerating? Why not now ?




Although the banks may not buy property directly here are a couple of examples.

Trillium consortium, backed principally by investment bank Goldman Sachs bought all the DWP estate

Another consortium, Servus, backed by Japanese bank Nomura, manages a number of government buildings such as the Royal Courts of Justice. Recently, it won a contract to manage the Department of Department of Trade & Industry's headquarters offices.

Taken from here
http://www.adamsmith.org/80ideas/idea/5.htm

Just as a small aside.. but are people aware that there are a number of former student properties that quietly went on the market...

In some instances previous student landlords with 100+ properties have put them ALL on the market...

In terms of student letting I would imagine that some have read the tea leaves, seen the wind of change regarding student finanaces, decided the house prices are at optimum and decided to get out while the going's good...

All the stuff about "crash" and "failing", etc... are all lovely "scare the bejezus out of the punters, let's sell more papers" type words but I'd be seriously surprised if the current prices can be sustained as they are... people simply can't afford to live.. and as for first time buyers like me... forget it... not unless I marry then murder my way into money...

... no, put the phone down, crimestoppers don't need to know... sheesh, some people can't take a joke.. :P

Originally posted by Martin_s
Just as a small aside.. but are people aware that there are a number of former student properties that quietly went on the market...

In some instances previous student landlords with 100+ properties have put them ALL on the market...

In terms of student letting I would imagine that some have read the tea leaves, seen the wind of change regarding student finanaces, decided the house prices are at optimum and decided to get out while the going's good...

:P

Isn't this more as a result of the increased supply of student accommodation available in the city centre at places like Truro works and Victoria Court? Landlords with student properties out of town have seen a drop in demand for these houses. I would imagine there will be a further drop in demand when the "Student Village" is completed on London Road.

Hi Neilaw, Max etc,
you claim that property prices are not going down, or that the figures are not up to date, just one link for you>

http://www.hometrack.co.uk/asserta/index.cfm?fuseaction=news.viewnewsitem&newsid=82

~Do people reading this board, believe in Hometrackas of july 2004 been correct, or a few moderators and mis informed out of date posters on this board , I rest my case ~

You can never argue with facts, for it provides weight and volume to a discussion!

Some people just can't be told anything, or educated!

Properety prices have never dropped in 30 years, show the evidence kid, otherwise drop the ranting!

ROFLMAO

Regards

Mark ..

It's very early to be on whatever it is you're on. :loopy:

You don't even understand that you don't understand!

Mark this is only a guess, but I think you'll find that Sheffield is in South Yorkshire and, according to that very informative document, South Yorkshire enjoyed a price rise of 0.1%, Hardly a price crash is it? Thanks for proving me right.

Incidentally, spot the irony:

Hey read the facts guys, your advertising your ignorant!


Have a nice day.

Hi Mikey

You take thew biscuit when it comes to humour, I rolled about for an hour laughing at your post above, in reply to me stating if properties always go up, then why don't all the banks buy property, and you came back with this and a link to prove your intelligence>

mikey
Tottyrator

Joined: Jan 2003
Location: Dore
Posts: 1413
Re: Neilaw proved wrong By Zorba! LOL
Quote:
Originally posted by Howy


#'PS for those who really think that house prices always increase, and this must mean above the retail price index, then why does not the big banks and money lenders just buy property? Why not all the banks in London buying the properties several years ago, when the market was accelerating? Why not now ?





Although the banks may not buy property directly here are a couple of examples.

Trillium consortium, backed principally by investment bank Goldman Sachs bought all the DWP estate

Another consortium, Servus, backed by Japanese bank Nomura, manages a number of government buildings such as the Royal Courts of Justice. Recently, it won a contract to manage the Department of Department of Trade & Industry's headquarters offices.

Taken from here
http://www.adamsmith.org/80ideas/idea/5.htm


---------------------------------------------

Mark Write>

All property purchases in this country are backed by financial institutions you moron, unless you have cash of course, normally refered to mortgages, have you heard of these?

If Servus or trillian above, go bust, or the market takes a dive, the banks are sitting pretty, they will still be owed any monies outstanding, all you have done is proved my point that banks don't invest their OWN MONEY!

The banks are covered by the companies insurance policies and also the banks assessment and gurantee that if anything goes upside down, they will still get their money!

The properties bought by Trillian or Sevus, will act as collateral and as an asset to sell off to obtain monies back if the investment goes sour. But the best bit is that large coporate property investment companies, (NOT BANKS I MAY ADD), are covered by insurance, as a cost to the rest of us!

These are the save deals you can obtain when buying your own house, again through financial institutions like banks and building societies backing you!

They have not bought the house for you, you owe them, and if anything goes wrong, they will be sitting pretty,not you!

So again, anyone else got any proof against my post, or to add weight to my post unknowingly, like this fool did!

LOL

Mark ..

Originally posted by Howy
The properties bought by Trillian or Sevus, will act as collateral and as an asset to sell off to obtain monies back if the investment goes sour. But the best bit is that large coporate property investment companies, (NOT BANKS I MAY ADD), are covered by insurance, as a cost to the rest of us!

These are the save deals you can obtain when buying your own house, again through financial institutions like banks and building societies backing you!

They have not bought the house for you, you owe them, and if anything goes wrong, they will be sitting pretty,not you!

So again, anyone else got any proof against my post, or to add weight to my post unknowingly, like this fool did!

LOL

Mark ..

Don't you listen? Banks etc DO buy property. What you seemingly fail to realise is that property is an illiquid income producing asset, and banks require liquid capital. All institutions have a mixture of investments, of which property is the backbone that provides the secure base to trade liquid assets from.

I don't think that you will understand that though.


Mod hat on:
1. Please learn how to use the quote function properly - your posts are totally unreadable.
2. Be careful when calling people 'moron' or 'fool' or other names... it normally results in complaints, and they often end up with bans.

Hi Tony

I give it to you, your a funny guy, when the going gets tough, lets turn to humour! Oh, then the threat of a ban, oh, my posts have become totally unreadable, a little bit of an exageration?

Take a deep breath and count with me 1,2,3,4 and breath out slowly!

Again

1,2,3,4, and breath out slowly!

BTW if you get rid of me, you will have no adverseries to contend with, your job as a moderator will be boring, your life finished!

I am not been personal Tony, just stating facts, I would like the same returned!

Why not do the following, we can empically test my Thesis, if you wish to believe its mine, and watch the property market for the next three months!

If it goes down, I am right, you can take me out for a pint in Dore, if it goes up, I take you for a pint!



Well, me personally will stick to what is blatantly obvious, that all properties collectively have just gone down for the first time this month!

Figures are weighted, which I dont want explain to you, but lets say this, we will simply wait for the results, lets say in 3 months from this date!

I bet the prices are lower in 3 months than what they are today!

Lets say the 'Economist' is correct!

You think they will continue to grow, I think they will drop in the next 3 months for the first time in a long time!

Your arguing with predictions made by some of the leading Universities, I know who I will put my money on!

Lets simply wait!

Regards

Mark ..

Well just come back in 3 months and bask in your glory..until then save your drivel. As Max has just stated the exception to the rule is Yorkshire with house prices actually rising. So what if house prices are falling?? They may fall but they will also rise again. The country's economy is stable enough to compensate for it and people will realise this and balance their own economy to suit.
Economists and other people who know better had been saying house prices were going to crash 2 years ago and it never happened. Its natural for a booming market to slow down and even out but there will never be a crash.

PS Howy, here is a FACTUAL website for you, www.Hometrack.co.uk. It tracks all sales and purchases via land registry and estate agents across the country, try it. Type in S1 or any sheffield postcode and see the results :D

I challenge you to come back to this site in three months and post the stats for sheffield S1 from now until beginning of November and lets see who is right.

As stated above, so called experts have been scaremongering for longer than two years that there will be a crash. :wow: didnt it hit the housing market hard :P

PPS- guess who writes in the economist, some of these expert types who live 200 miles away in kensington, have no idea of micro-econoimcs, or macro come to think of it and think they can predict the national market, come on, even you must appreciate that is flawed.....

PPPS- mathematical equations (ripple effect) can only suggest at an outcome, they cant say exactly, otherwise everyone would be using them and we would all be very very rich :thumbsup:

Originally posted by Howy
Hi Mikey

You take thew biscuit when it comes to humour, I rolled about for an hour laughing at your post above,


It wasn't supposed to be humourous you plank, I aint even gonna waste my time trying to put you right about the banks behind the organisations I mentioned.

rolling about an hour - bit of an exageration eh?

Try using the preview button as well next time.

Proof for you Howy, quote from B&B on BBC website:

The group said there were "early signs that the housing market may be beginning to cool".

But it added that while "price growth will slow" over the rest of the year, there would not be a sudden correction.

"We continue to believe that the fundamentals necessary for a sudden correction are not evident, and that a gradual slowdown is the most likely outcome," B&B said

Don't waste your time trying to get him to respond (isn't that what I'm doing :loopy: ) he is obviously trying desperately to find some facts which prove that house prices are falling in Sheffield. Unfortunately, he can only supply links which prove the opposite.

Perhaps he will come back in 3 months and eat humble pie but somehow I doubt it.

Mmm... Anyway, what's going to happen to the hordes of would be first time buyers who'll not be able to afford a home of their own now? I know that they'll probably have to rent, but I'd have thought that most people aspire to own their own home one day. It's a bit of a downer from their perspective isn't it?

Originally posted by Funky Dave
Mmm... Anyway, what's going to happen to the hordes of would be first time buyers who'll not be able to afford a home of their own now? I know that they'll probably have to rent, but I'd have thought that most people aspire to own their own home one day. It's a bit of a downer from their perspective isn't it?

If people are that desperate to buy a place then maybe they'll bite the bullet and buy in the cheaper areas. We could be seeing the start of a social revolution where the children of the affluent south and west of the city are forced to buy in other parts of the city.

Originally posted by Funky Dave
Mmm... Anyway, what's going to happen to the hordes of would be first time buyers who'll not be able to afford a home of their own now? I know that they'll probably have to rent, but I'd have thought that most people aspire to own their own home one day. It's a bit of a downer from their perspective isn't it?
Maybe, but we're adjusting to the model that virtually the rest of the world operates - renting until you settle down in your 30's and maybe always.

Home ownership is a very modern thing - 50 years, that's all. Renting was the norm.

Originally posted by max
If people are that desperate to buy a place then maybe they'll bite the bullet and buy in the cheaper areas. We could be seeing the start of a social revolution where the children of the affluent south and west of the city are forced to buy in other parts of the city.

Nah... from people I know, they're either choosing to rent in the SW or buying shoebox flats in the SW. That is of course of the ones who haven't been forced out of Sheffield altogether through lack of career prospects round here.

presumably most of the people growing up in sw end up at uni.
And the majority of graduates go wherever the work is, not back home. I'm in the minority.

Still not seen much evidence of a crash, i think people are trying to avoid that at all costs.

More evidence of a house price crash (not) in Yorkshire from The Land Registry:

The Land Registry said the value of property shot up by more than 27% in Wales and the north-west between the second quarter of 2003 and the same period of 2004, while prices rose by nearly 26% in the north and Yorkshire and Humberside.

Full article from the Guardian:

House prices soar in Wales and the north (http://money.guardian.co.uk/news_/story/0,1456,1279317,00.html)

DON'T PANIC.. DON'T PANIC...
MR MANWEARING... DON'T PANIC

Just came across this, does seem to be in the more southern regions....

http://www.reuters.co.uk/newsPackageArticle.jhtml?type=personalFinanceNews&storyID=563908&src=eDialog/GetContent&section=finance

Nah, hey are going up aren't they. We bought our house in Stannington for £110,000 three years back. It is now worth just over double that NOT including the extension being done now which is going to increase the size.

Things are sticking on the market longer, especially at the top end. There also seems to be quite a few larger properties springing up on the market. I think the owners are trying to get their money and run, downsize or move abroad.

I think it's fair to say that the top of the market has always taken longer, but the problem at the moment is a lack of 'first time buyer' stock.

However... this is being addressed in some new developments where units are being targeted at a low price to help people get on the ladder.

I think that this will help to give some more impetus into the whole market locally - which is still in very good shape anyway.

http://www.guardian.co.uk/uklatest/story/0,1271,-4439844,00.html?gusrc=ticker-103704

University town house prices soar

me and hubby to be bought our house on a new development december 2002 moved in in jan 2003 so we've been here about a year and a half! bought it for 65k and now its worth 120k its doubled in the time we've been here and they are still building on the site! you wont get anything on this site for under 100k now whats that about??? it's not even a posh area!

Price crash? Not going to happen, except possibly at the very top end.

It's all relative. The cost of a decent house in crookes or walkley, nice areas, is still far below equivalent houses in many other areas of the country where realistically salaries are little different for the equivalent prospective buyer. Prices may slow down, even stagnate, but they are still below "national market value" in many cases which is why sheffield is a good investment.

Also, as others have pointed out, house buying is a UK oddity. In most countries they rent or even build. Buying a house is a strange and very british obsession. Friends in other parts of europe find it very bizarre.

First time buyers will take longer to buy a house, will rely on more help from parents, and will rent for much longer. House values may grow slower and houses may take longer to sell.

Also bare in mind that sheffield is already odd because in many areas houses go for well above asking price and within 2 weeks. This doesn't happen that much elsewhere, even in a rising market. This is very location dependant tho.

Finally, mortgage payments as a % of income are still fairly well balanced and that's probably the overriding consideration.

What's going on? Is this thread months old? Houses in my area were on the market for less than a week before shifting at the beginning of summer. They're not shifting at all now. Sorry, I can't help it, but I'm beginning to panic. :confused: It's OK if you know you don't have to move. But relocation might not be an option for me. I'll need as much cash as I can get my hands on soon.

What area are you selling in?

Don't worry Mr_E, it's just the time of year, holidays and all that. It always takes longer in August. :)

Just a little point of reference, spotted on the web today:-

http://news.bbc.co.uk/1/hi/business/3602968.stm

Hmm, so hang on then, why does the Council of Mortgage Lenders say that July figures were:

• 131,000 loans. The highest total recorded since the previous high of 135,000 in Aug 02.
• Gross lending 3% higher than June and 13% higher than Jul 03
• Record house loans of £14.7bn compared to £13.9bn in June.

That is a very different picture. The answer of course lies in the BBA report that you cite not including all lenders, only banks. The figures that I quote include ALL lenders, and are far more accurate.

So the statistics also back up no evidence for any 'crash'.

Why are so many people wanting to look on a non-existant doom scenario?

Here's the link to the true figures (http://www.cml.org.uk/servlet/dycon/zt-cml/cml/live/en/cml/press_releases_2003_0820)

Tony, I agree. What is it with people that dont understand the concept of regional impacts. OK the south may see a slowdown or even a crash, significant or otherwise, doesnt necessarily mean anything to other regions in the UK, that also explodes down to inner city regions.

Not sure people have the brain power capable of working this out ! no offence anyone......:P

Do people want to see a crash? Its this sort of scaremongering that can damage the market, nothing to do with economics. Its very much like the stock exchange, word of mouth doomsayers can easily damage an equity, get a grip guys.

All it takes is people who own substantial portfolios to see this board, are not capable of understanding the reality, they get scared and sell-up leading to a dip in the market. Hey presto you get a decline.....

Do people actually realise this is what happens!

If there is anyone contributing negatives to this board who owns a property in sheffield I strongly advise you to think again, it could easily hurt your wallet due to your very own comments, be very careful.

http://www.sheffieldtoday.net/ViewArticle2.aspx?SectionID=58&ArticleID=846494

Another relevant link.

Originally posted by neilaw
Tony, I agree. What is it with people that dont understand the concept of regional impacts. OK the south may see a slowdown or even a crash, significant or otherwise, doesnt necessarily mean anything to other regions in the UK, that also explodes down to inner city regions.

Not sure people have the brain power capable of working this out ! no offence anyone......:P

Do people want to see a crash? Its this sort of scaremongering that can damage the market, nothing to do with economics. Its very much like the stock exchange, word of mouth doomsayers can easily damage an equity, get a grip guys.

All it takes is people who own substantial portfolios to see this board, are not capable of understanding the reality, they get scared and sell-up leading to a dip in the market. Hey presto you get a decline.....

Do people actually realise this is what happens!

If there is anyone contributing negatives to this board who owns a property in sheffield I strongly advise you to think again, it could easily hurt your wallet due to your very own comments, be very careful.

Is that why everyone is bigging the market up?
Oh, I see... now.
Gosh, I thought for a second that my expensive education was a waste of time.
This is a discussion board is it not? That means things are discussed and all areas, speculative or otherwise, positive or negative, are covered.
Total agreement is often the result of a lack of communication.
Not sure people have the brain power capable of working this out ! no offence anyone......:P (used with some irony)
The bigger something is, the harder it falls. Equilibrium is the most stable state. The laws of physics determine how big a bubble can get before it bursts of its own accord but a child knows not to blow too hard.
Now I don't know if I agree with Tony or not, time will determine who is right. But I do value his remarks as he seems to know what he is talking about and I'm certainly not going to question his intellect.
In fact, a small proportion of the quote above has a significant validity. But...
If people here have their opinions they have the right to express them, whatever their reasons are for doing so. You may disagree with them but it is arrogant (-a very poor quality, and in my opinion*, a sign that someone lacks the intelligence to strategise appropriately) to publicly comment on someone's brain power.

*at the risk of sounding hypocritical.

since most of the people who own a property here find themselves with massive positive equity it will have no impact on their pockets if the market crashes, but will have an impact in bringer the next step of the housing market a bit closer.
Unless someone has bought very recently, or owns property as an investment (in addition to a house to live in) then they should welcome a slow down in the housing market.

was anyone at the afternoon session of Jenkinsons auction yesterday afternoon?

although some properties sold well, I can't ever remember so many properties not reaching reserve. Some didn't even get bids.

houses that would have sold for 120k+ before the summer weren't getting past 85k.

also there were 62 lots - the most I can ever remember. This would suggest that landlords/investors are selling rather than buying at the moment.

Do they know something we dont'? Or are they just being kind, thinking that they have made enough and its time someone else had a go?

ps. if I start a panic and am personally responsible for the start of a crash, I apologise in advance.

I've noticed on our road and the surrounding areas, a lot of properties have been on the market since the start of the summer and still not sold (only last year they were being sold within days). However, I'm not worried that prices are suddenly going to crash in Sheffield, I don't think it will happen. They may level off for a period.

A good indicator of price levelling is to look at the monthly auction of Mark Jenkinsons. The fire for the property seems to have died down, and although people are paying more today then they did say a year ago, they are not paying those extra premiums as willingly.

Originally posted by sham71
also there were 62 lots - the most I can ever remember. This would suggest that landlords/investors are selling rather than buying at the moment.


It could just be because there wasn't an auction in August.

Prices seems to be levelling rather than crashing (which is what the interest rate hikes were suppose to acheive). I guess it depens which area of the city you're looking in.

Thats what a number of us have been saying for a while, wonder if the doom sayers have any comment from two months ago? :o

This is always a flat time of year for property. People are only just back from the summer hols.

I bought in Hillsborough for £60,150 in May 2002.

Similar houses to mine are now going up at around the £92,000 mark. My house would possibly go on at a higher price as it is very modern inside i.e. no chintz, no flock wallpaper...

I would expect it to fetch over £100k.

It's ridiculous - I've nearly doubled my money in just over two years.

Well a friend is trying to buy a house in Hillsborough at the moment that went on the market for 92K I think, last count they had offerers of over 100k so things are still selling.

Originally posted by liencam

It's ridiculous - I've nearly doubled my money in just over two years.


That would be nice if it was true, but realistically speaking you've only doubled your wealth on paper because, unless you intend on living in a cardboard box, the fact that your house is worth so much more than when you bought it doesn't mean much. Every other house has gone up by similar proportions.

Originally posted by march
Think that was more, continue that thread rather than don't discuss it.

how come you've made 170 odd posts

I understand that.

I intend to use the equity as a deposit on a property off - plan, and then reinvesting the profit from that into a home for myself and my partner.

you'd still be better off if the market had stayed flat from when you originally bought. That way the difference in price between your house at current value and the flat at current value would be smaller, and since your salary would be the same it would be easier to move up the market.

Originally posted by liencam
I understand that.

I intend to use the equity as a deposit on a property off - plan, and then reinvesting the profit from that into a home for myself and my partner.

I need the equity for my deposit though, so I'd only be in the same position as I was when I bought.

imo, you are making 2 mistakes if your aim is to make money.

Firstly, you are releasing equity at the exact time when it is people with equity that are in the best position to ride out any down turn in the housing market.
Secondly, you are buying off plan at a time when housebuilders are reducing their prices due to excess supply. You may end up with a property that you could have bought cheaper this time next year.

This, however, is only my opinion........

Originally posted by sham71
imo, you are making 2 mistakes if your aim is to make money.

Firstly, you are releasing equity at the exact time when it is people with equity that are in the best position to ride out any down turn in the housing market.
Secondly, you are buying off plan at a time when housebuilders are reducing their prices due to excess supply. You may end up with a property that you could have bought cheaper this time next year.

This, however, is only my opinion........

I dont think she will get it cheaper next year if shes buying it now 'off plan'. It would have to be a complete balls up in the market, and the developer would have to ride out a margins storm to make it work then.

Totally agree with 1man&hisbmw. Sheffield is pretty immune to large fluctuations in either direction, but for what it's worth, it's a very hot spot for out of town investors at the moment that are doing precisely what you are thinking about.

The point of 'forward purchasing', especially at a VERY early stage is that you sign up to a price that is usually at a small discount to comparable 2004 prices and don't have to complete for anything between 1 - 3 years!

Of course your money is tied up, but what's the betting that in a couple of years, that double discount will make your purchase look very cheap indeed!


Even with an incredibly modest rise will make you far more money on your deposit than you could anywhere else.

For example - 10% deposit on a £100k property + your £1k reservation, total investment £11k

Wait patiently (for at least) 12 months for property to be completed.

1% increase in value = £101k = 10% pa return on investment
2% = £102k = 20% ROI
3% = £103k = 30% ROI

Take a more current increase

20% = £120k = 200% ROI
30%.... get the picture - it beats a Halifax 'high interest' savings account? :heyhey:

Now once you have put that in your pocket, there's the small matter of the potential rental income! :clap:

Ever met a poor landlord?:suspect:

Originally posted by sham71
Firstly, you are releasing equity at the exact time when it is people with equity that are in the best position to ride out any down turn in the housing market.
Just how do you use equity to ride something out? You can only USE equity to do something, leaving it where it is is no use to man nor beast.

Originally posted by Tony
Sheffield is pretty immune to large fluctuations in either direction

I did an economics degree and I can't remember this 'law' ever being mentioned. Have we not just had a large fluctuation in one direction?

Originally posted by Tony
Ever met a poor landlord?

Well, I actually am a landlord, and the reason I will not be poor is precisely because I can see that the only way isn't always up. I sold the bulk of my houses this year....and I know they are already selling for less in those areas.

Originally posted by Tony
Just how do you use equity to ride something out? You can only USE equity to do something, leaving it where it is is no use to man nor beast. [/B]

well....firstly, the less you owe on your property, the more immune you are to interest rate rises. More equity means less debt and less chance of not being able to make your payments.

secondly, lets say you owe £95,000 on a house worth £100,000. If there is a downturn and the value of your house drops to £80,000, the lender is then within their rights to re-possess as the asset that is securing their loan is now worth less than the loan. This happened in the early 90's especially in the south. The more equity you have the less likely this is to happen.

As I have said before, speculative bubbles always burst. Buying off-plan purely to sell on at a profit is speculation, pure and simple.

Well you know best eh ;)

Originally posted by sham71
secondly, lets say you owe £95,000 on a house worth £100,000. If there is a downturn and the value of your house drops to £80,000, the lender is then within their rights to re-possess as the asset that is securing their loan is now worth less than the loan. This happened in the early 90's especially in the south.

They might be legally able to reposess but they wouldn't. Why would they turn away all those lovely mortgage payments with interest?

The only time they would reposess would be if you failed on quite a few payments and made no attempt to contact them and put it right.

Mortgages have changed a lot since the early 90s

i'm sure they'd be able to reposess. The loan is secured on that property, sure. But as long as you continue to pay the mortgage you aren't in breach of contract.
In the 90's people weren't able to make the payments, that why repossessions happened.

if you've bought as an investment and increasing market is good.
If you've bought because you need to live somewhere, and sometime in the future will move onwards and upwards, then a flat market is better (or even a declining market).

Here we go again..more stories re: House Price falls...


http://www.reuters.co.uk/newsArticle.jhtml?type=businessNews&storyID=6325332&src=eDialog/GetContent&section=finance


What is everybodys general opinion now... as this thread has been rolling for a while now???

Did you notice the opening word of the article?

LONDON:

The London based media loves a story like house prices, except they don't realise that the rest of the country has different phases and different markets. Big headlines sell news.

Sheffield has no evidence whatsoever of a fall in prices. Sure, rises have steadied, like you would expect after a period of high inflation, but a crash? Nahhhh.

Originally posted by sham71


secondly, lets say you owe £95,000 on a house worth £100,000. If there is a downturn and the value of your house drops to £80,000, the lender is then within their rights to re-possess as the asset that is securing their loan is now worth less than the loan. This happened in the early 90's especially in the south. The more equity you have the less likely this is to happen.



Erm, I see your logic, but thats not exactly how it works.

Repossession happens based on your inability to pay what you agree to pay each month / year. Or indeed failing to make any arrangement to pay if in difficulty. Banks are not alway so callous to want to kick people out of their homes. In any case they tend to sell the property at auction for a 'salvage' value.

Why would they want to do that, and bear increased cost of that, when they have a person paying every month in contract for x-years? They have agreed to buy the house at £95k, the lender is just that, the lender. They will not reposess early if their security is worth less, because they have you in contract to pay the full amount you owe them :) They will still get their money, regardless if you house is worth 50% of what it was when you bought it.

The only way to get out of negative equity is give up the house, they will sell if off as salvage on auction, and get back what they can, but you are still liable for whatever is remaining.

For example.

£100k house on 95% mortgage LTV
Deposit £5k

Balance £95k

Monhly payment (for sake of argument) £700 C & I 25yrs

after 12 payments ( or 1 year) you find the value of you home is now £80k (you have made £700 x 12 in payment which = £8400)

Of the £8400 lets say some £3400 is interest, therefore

The bank has a £90,000 capital interest in your property at that time.

(it will differ depending on their capital/repayment ratio) But this is for simplification of the maths!

You have paid out £13,400 in total

House now worth £80,000

If you bailed out, said you couldnt aford to pay they would take the house, charge you a redemption, and admin fees (x-amount!)

For this argument lets says its £1500 redemption, and £1000 admin fees thats another £2500 to your bill.

You owe the bank £92,500

House salvages for £74k for example at auction.

You are still liable for the other £18,500 so maybe bankruptcy is the only option. That £18.5k worth of living in the house, or over 2 yrs.

I can see what you mean if you are accounting for interest rate hikes, but i dont think i have heard of homes being repossessed from paying people regardless of the equity in the homes.

If I am wrong somewhere here, I await Tony to correct me here :)

in the last housing crash, as equity became negative, the banks asked borrowers to increase their monthly payments to pay off the negative equity quickly so that the loan was once again covered by the value of the asset.

People were faced with increased payments due to interest rate rises, followed by the banks asking them to increase their payments further. This is one of the reasons that so many people were repossessed as the payments became impossible to maintain.

Also, imagine the crash was to mirror the rise we have had (very unlikely I admit, but possible). You say that its not in the banks interest to repossess the home and sell it for less than they are owed. This is true, UNLESS prices are expected to keep falling. In this case the sooner the bank repossesses the better. They may get £80k this year, but a 20% fall would leave them with only £64k a year later if they had to repossess then.

Originally posted by 1Man&hisBMW
If I am wrong somewhere here, I await Tony to correct me here :)
It looks good to me! :D I'll mark your work later 1man (looks like a gold star and a tick :hihi: )

People get themselves in a tizzy about house prices without really understanding the quite simple mechanisms of the market. Historically property has been the best investment in terms of security and inflation - and it will always continue to be so regardless of what doom-sayer journos say from the comfort of their office in Wapping, recycling old stories for dramatic effect.

Put simply, rather than buy a pension product, buy a property. It's a medium / long term investment that will outperform any stock market, bond, or commodity.

Sham71 - A crash of previous proportions (although it was really a 2 year long blip, not a crash) was preceded by rates 3 times higher than now and high unemployment with a job market becoming increasingly unstable, not to mention the effect of the stock market crash (and yes - that DID crash). We now have a much better system in place and those conditions just aren't going to ever occur again.

Originally posted by sham71


Also, imagine the crash was to mirror the rise we have had (very unlikely I admit, but possible). You say that its not in the banks interest to repossess the home and sell it for less than they are owed. This is true, UNLESS prices are expected to keep falling. In this case the sooner the bank repossesses the better. They may get £80k this year, but a 20% fall would leave them with only £64k a year later if they had to repossess then.

Even if prices keep falling, they have the buyers in contract to pay the outstanding sums due. If there is no record of severe financial difficulty facing the buyer of the property and their accounts are kept up tot date and always paid up on time, I think the lender would be very very very hard pushed to get the case through court and a successful verdict registered.

if it was put to the court a family of 4 are living in a house, they are paying according to the agreement on time, and their finances are in order you are facing an uphill struggle to get the courts to agree to have them kicked out essentially. If there is no 'critical' breach of the contract (for example you catagorically REFUSE to pay or make ANY agreement to pay), then the term of payment will apply.

It's a loan at the end of the day - and that loan is merely secured on the property.

As 1man says, unless you default on paying the loan, there would never be a repossession. That would be the best way ever for a lender to lose a packet!

Originally posted by Tony
It looks good to me! :D I'll mark your work later 1man (looks like a gold star and a tick :hihi: )


Shiny red apple on your desk first thing monday morning sir :)

What does eveybody think about this article...

http://news.bbc.co.uk/1/hi/business/3701070.stm

When the interest rates start to creep up, real estate comes down, and visa versa.

http://uk.news.yahoo.com/041018/325/f4s3c.html

Did anyone read the article in the property guide about houses being under valued in Sheffield, I know that some estate agents are giving much lower values than others ,last week a property was valued by one Sheffield agent at £260 then the same property by another agent at £295 (there were two in the middle), but it is staggering how one particular agent seems to be giving really low valuations.

Originally posted by Caronp
week a property was valued by one Sheffield agent at £260 then the same property by another agent at £295
Now that's what you call under pricing :o I didn't know you could buy a house for less than £20,000 ;)

The property guide talking the market up? Now that is a surprise.

You may find that the agent that quoted £260k works on a no sale no fee basis ie. it is in their interest to accurately value the property to ensure it sells or they get no money.

The agent that quoted £295k probably takes a fee regardless. They work on the principle of giving the highest quote to get the business then even if it doesnt sell, they get their £500+.

Call me an old cynic, but thats my experience.......

Well it was the opposite, the higher valuer, worked on a no sell no fee as in commission and vica versa????
Most agents cant or wont charge you commission if they dont sell the house as they did not sell it( with a sole agency contract), how come some agents in Sheffield tie people in to sole selling contracts that seems so unfair, meaning they take the commission even if you sell it yourself.
I know most people are unaware what they are signing for .

What does everyone think about these stories, they keep cropping up... Is it the media just trying to whip up a storm or is there real evidence of a dip in prices???

http://www.reuters.co.uk/newsArticle.jhtml?type=businessNews&storyID=6594463&src=eDialog/GetContent&section=finance

Originally posted by Howy
Hi Tony

I give it to you, your a funny guy, when the going gets tough, lets turn to humour! Oh, then the threat of a ban, oh, my posts have become totally unreadable, a little bit of an exageration?

Take a deep breath and count with me 1,2,3,4 and breath out slowly!

Again

1,2,3,4, and breath out slowly!

BTW if you get rid of me, you will have no adverseries to contend with, your job as a moderator will be boring, your life finished!

I am not been personal Tony, just stating facts, I would like the same returned!

Why not do the following, we can empically test my Thesis, if you wish to believe its mine, and watch the property market for the next three months!

If it goes down, I am right, you can take me out for a pint in Dore, if it goes up, I take you for a pint!



Well, me personally will stick to what is blatantly obvious, that all properties collectively have just gone down for the first time this month!

Figures are weighted, which I dont want explain to you, but lets say this, we will simply wait for the results, lets say in 3 months from this date!

I bet the prices are lower in 3 months than what they are today!

Lets say the 'Economist' is correct!

You think they will continue to grow, I think they will drop in the next 3 months for the first time in a long time!

Your arguing with predictions made by some of the leading Universities, I know who I will put my money on!

Lets simply wait!

Regards

Mark ..

I'm looking forward to the return of this loon to back up his 3 month theory. :loopy: :loopy:

Hehe.. I think he owes me a pint wibbles, but I have this feeling that he won't be old enough to buy me one ;)

Maybe he could take me for a backie on his BMX?

sent you pm

The strange thing about a buyers market is that at this time one thing is happening,and that is that Buyers are not Buying. In a sellers market there are too many buyers and so prices go up and now they have dropped more than people want to admit. So its a good time to buy so get buying!

there is still excess demand for housing in the uk, and prices are still high to the point of precluding most first time buyers from actually entering the market.

I didn't go to Mark Jenkinsons auction today, but checked on their website........14 out of 32 lots up for sale were NOT sold.

Each month more properties are failing to reach reserve at the auction.

I would call this good 'local' evidence of a slow down.

All you people who think the only way is up should get yourself down to the next auction and snap up a bargain.

sent yo pm

Originally posted by letting
Is it possible that the prices are falling because its near to xmas and nobody wants to be moving Xmas and new year?

Well, they fell in the summer because everyone was on holiday.
They failed to pick up in the autumn because everyone was paying off their summer holidays.
They are falling now because its the run up to Xmas.
They will fall after Xmas because everyone will be paying off their credit cards.

Or maybe they are just falling because they are overpriced.....

More info from research company Hometrack :-


http://www.reuters.co.uk/newsArticle.jhtml?type=businessNews&storyID=6867060&src=eDialog/GetContent&section=finance

myself and my partner are both teachers and we can't afford to get onto the property ladder unless we buy something at the very very bottom.

It makes me wonder if two graduates living together cannot afford to get onto the ladder due to paying back debts from university/ wages not matching house prices, how are many other first time buyers going to make it?

The majority of my freinds in thier mid twenties cannot afford to buy and it's near enough impossible if they are single, my sister who lives on her own and works hard in the beauty business reckons she will have to buy a house with a mate if she is to get onto the property ladder.

I cannot see prices rising dramatically in the next 5 years as people wages will have to rise to make the short fall the only prob is we have to live somwhere in the meantime which drives the buy to rent purchases which therefore increase the prices. Hopefully if the prices level out a bit and stop rising for a while I might be able to consider getting myself a house when i get my pay rises!

Well.I have an up to date experience of all of this..
House sold STC in October ( end) for 225,000.Purchasing house at 285,000, which has been on the market for 5 months and eventually went to sealed bids.

I was at the stage of paying for the survey on the house that I am buying and as the purchaser of my house had not sent in hers, I held back from sending my cheques.
My purchaser is now unsure as to whether or not to buy( due to personal circs, not actually having second thoughts though) and we have to now remarket the property.It is going back in the property guide next week
Problem is, as time has gone by and I am checking out prices to compare to the one we are buying, I am unsure as to whether the house that we are purchasing is really worth what we are paying and now that we havent actually sold ours, we may not now get asking price, which means in turn that we cannot pay full asking on the other..
What a dilemma.Any suggestions?

More press reports on the state of the market. What does everyone think, what are your local experiances at the moment. I have noticed a lot of houses up for sale locally, that have been there for a couple of months now. Not sure if this is a seasonal thing or an early indicator of a slow down??


http://www.reuters.co.uk/newsArticle.jhtml?type=businessNews&storyID=6878741&src=eDialog/GetContent&section=finance

http://news.bbc.co.uk/1/hi/business/4030567.stm

ok, iam "old"! got a good job! but still cant afford to buy with the property prices at the moment.....
Any idea ???????

Originally posted by sham71
I didn't go to Mark Jenkinsons auction today, but checked on their website........14 out of 32 lots up for sale were NOT sold.

Each month more properties are failing to reach reserve at the auction.

I would call this good 'local' evidence of a slow down.

All you people who think the only way is up should get yourself down to the next auction and snap up a bargain.


Its not really good local evidence. Alot of their properties are investor properties, some which were for sale a year ago for £40k less, to guess who.... yep the SAME investors.

32 properties in one month is not a great indicator, add to that the fact of investors wanting to cash in and sell up some of their properties. The auction game is a specialist market really, you dont seem many houses there that dont need some significant works on them.

barclays announced today that they expect a 20% fall over the next 2 to 3 years.

Yes, but on GMTV ,they have contested that.
I have had to remarket my house due to purchaser hanging on to see whether she has another job outside Sheffield .As she wont know for another 2 weeks or so whether the job is a reality she has held back on her survey so I have been advised to remarket the property.
It is going back in property guide on Friday with Winkworths.
It was sold at the asking price about 4 weeks ago and we havent had an interest rate rise since then.
People are more hesitant now and are coming back more than once to view to make sure it is the right decision.However, I think if the property is saleable and is marketed correctly, then people are still looking to move.
It wont make a difference to us personally as if we take a cut on ours, then inevitably the one we buy will have to consider the same.

press cutting, eat your words all the doom sayers last year:

"North south divide

The bank said that the recent pattern of house prices rising the fastest in the north of England continued in December.

In the North West and Yorkshire and the Humber, Halifax said prices rose by 3% and 1.2% in the two regions respectively during the month.

At the other send of the scale, prices in the South East and London fell by 1.6% and 0.5% respectively. "

Is this true ?

Are house prices heading for a downward turn !? ...

lets hope not, there would be a civil war in this country considering the equity whats been used up on prperty. dont get the same reaction when rents contstantly go up tho do you. greed greed and more greed , thats all it boils down to, in my opinion if you buy property its a gamble like a lot of things. some you win some you lose ?

Originally posted by Jamie
Is this true ?

Are house prices heading for a downward turn !? ...

Thats because the interest rates are climbing up again, property prices come down then.

I think interest rates will stay steady now, and house prices increases will slow down, but probably wont fall in most areas of the country. They put interest rates up partly to pull back house prices as they were spiraling out of control. They have achieved this so have no need to increase them further.

I hope it is true because I will move to shef. soon. I cannot afford a big rent.

Graph of Sheffield house prices (http://www.upmystreet.com/property/prices/all/l/sheffield.html?umssheffield=UMS4610)

http://www.firsttimebuyerhelp.co.uk/images/youarehere.gif

Please use his graph to help interpret Strix's graph of Sheffield house prices.
Note this one goes from 1952 as opposed to his which is from 1996.

Cheers

d

Do you have that with a readable scale please ukdavvy?

I don't think they will drop that much in Sheffield (though not go a lot above the asking price), but have already done in London and SE.

Prices are not falling, but they are not rising as fast as they might have once been doing.

People are not willing to go silly now, the effect of the increase in interest rates reflects directly on the pocket... people are realising that.

Originally posted by dudu
I don't think they will drop that much in Sheffield (though not go a lot above the asking price), but have already done in London and SE.

I think you're quite right that prices won't drop much - if at all really - in Sheffield, because Sheffield house prices are relatively reasonable compared to other places in the UK. (Yeah, yeah, I know prices are out of this world, but you do still get a lot more for your money in Sheffield than most other cities).

2-3 years ago we were trying to move to Leeds (breathes sigh of relief that it didn't happen in the end) - and the house prices were completely unbelievable! And they just kept going up! Ended up the asking price was something like #200,000 plus for a (very) ordinary 3 bedroomed house in an ok area. And that was just for starters - people were apparently putting in offers WAY over that.

Mostly seemed to be fuelled by Buy to Let :gag: :rant: - runs off to clean mouth out.

Schadenfreude I know, but I'm looking forward to Leeds prices dropping! :clap:

StarSparkle :D

They are going to fall.

Lots of reasons why but you have to look at price against income, historical graphs, people saying that "house always go up" and "this time it's different" will be proved wrong again.

The thing everyone has to remember is high house prices are generally bad for everyone, apart from those getting off the ladder at the top. If you own a 50k house which then become 100k, you have to get a bigger mortgage to take the next step (i.e. the 70k house that is now 140k).. Ok over simplified.

The problem is people "feel" they are rich with high house prices but at the end of the day it is just a 4 walls and a roof.

The rest of the country follows the south east so just wait a year when taxes will start to go up, utility bills go up, people's cheap mortgage deals end, unemployment starts creeping up, the consumer driven spending binge ends. etc etc...

Plus in Sheffield I've noticed that there are literally thousands of new student beds becoming available in town (The Forge, Unite) as well as the new Student village. Students are likely to prefer living in these places than grotty houses in Broomhill/Crookes so I see a lot of BTLers having empty houses...

Supply/Demand - first rule of economics

to answer this question accurately you need to appreciate that the housing market is segmented into price brackets and it depends what value bracket of house you're after as to whether you're facing a market of falling or rising prices....

Certainly to my knowledge the cheapest end of properties are selling like "hot cakes" and in excess of the asking price. Take for example the property that Blundells have on offer at £40K on Dundas Rd....No upstairs central heating, convicted drug pusher (until he allegedly got 7 years last year - search on Sheff Forum) lived on the street, further modernisation req'd to the house. Latest offer until it goes to sealed bids later in the week of £61,000 (more than 50% higher than the asking price)....So certainly in this price bracket prices are still going up....

first rule of economics is scarcity, all resources are scarce, not supply and demand...

Originally posted by jimmy
They are going to fall.

Lots of reasons why but you have to look at price against income, historical graphs, people saying that "house always go up" and "this time it's different" will be proved wrong again.

The thing everyone has to remember is high house prices are generally bad for everyone, apart from those getting off the ladder at the top. If you own a 50k house which then become 100k, you have to get a bigger mortgage to take the next step (i.e. the 70k house that is now 140k).. Ok over simplified.

The problem is people "feel" they are rich with high house prices but at the end of the day it is just a 4 walls and a roof.

The rest of the country follows the south east so just wait a year when taxes will start to go up, utility bills go up, people's cheap mortgage deals end, unemployment starts creeping up, the consumer driven spending binge ends. etc etc...

Plus in Sheffield I've noticed that there are literally thousands of new student beds becoming available in town (The Forge, Unite) as well as the new Student village. Students are likely to prefer living in these places than grotty houses in Broomhill/Crookes so I see a lot of BTLers having empty houses...

Supply/Demand - first rule of economics

Originally posted by jimmy
Plus in Sheffield I've noticed that there are literally thousands of new student beds becoming available in town (The Forge, Unite) as well as the new Student village. Students are likely to prefer living in these places than grotty houses in Broomhill/Crookes so I see a lot of BTLers having empty houses...

Supply/Demand - first rule of economics

Well that's what i'm hoping anyway! Relocation of students to the city centre and central suburbs is great news for first time buyers in Sheffield. There must be hundreds of proporties around Hunter's Bar/Crookes/Broomhill that will come on to the market. I just hope that other non-students continue to be attracted by city living so I can find a nice house with a garden at a good price.

M

Originally posted by Mattski
Well that's what i'm hoping anyway! Relocation of students to the city centre and central suburbs is great news for first time buyers in Sheffield. There must be hundreds of proporties around Hunter's Bar/Crookes/Broomhill that will come on to the market. I just hope that other non-students continue to be attracted by city living so I can find a nice house with a garden at a good price.

M

I hope so too. I suppose it all depends on the cost of these new places vs rent in traditional student areas. The landlords who haven't made any efforts to modernise their houses will lose out. I've seen some grotty places in my time...

Originally posted by BertieBasset
first rule of economics is scarcity, all resources are scarce, not supply and demand...

a scarce resource is worthless if there is no demand for it.
and scarcity is just another measure of supply.

the defacto first rule of economics is that all resources are scarce. Scarcity isn't another measure of supply, it's a measure in itself, there needs to be a willingness on the part of the owner to supply.

Scarcity is measure of how much of a resource there is, not whether someone is willing to supply it... Geeeez who taught you economics? :gag:

Originally posted by Cyclone
a scarce resource is worthless if there is no demand for it.
and scarcity is just another measure of supply.

Originally posted by BertieBasset
the defacto first rule of economics is that all resources are scarce. Scarcity isn't another measure of supply, it's a measure in itself, there needs to be a willingness on the part of the owner to supply.

Scarcity is measure of how much of a resource there is, not whether someone is willing to supply it... Geeeez who taught you economics? :gag:

i was arguing from a semantic point of view not economic one. Semantically it's the same measurement.

Whats the economic difference between a resource that is scare and a resource where the supply is limited?

as I mentioned previously they are 2 different things, so if we are talking semantics (meanings of words) then the two words have different meanings as I explained previously.

To quote you..."Whats the economic difference between a resource that is scarce and a resource where the supply is limited?"

A resource that is scarce - i.e. a resource where there isn't much of it, it is limited in quantity, there is a scarcity problem

A resource where supply is limited - supply can be limited to resources which are not scarce, i.e. they may be plentiful, it's not only scarce resources that are limited in supply

Hence why the word "scarce" has it's own dictionary definition!




Originally posted by Cyclone
i was arguing from a semantic point of view not economic one. Semantically it's the same measurement.

Whats the economic difference between a resource that is scare and a resource where the supply is limited?

from dictionary.com
scarce ( P ) Pronunciation Key (skârs)
adj. scarc·er, scarc·est
Insufficient to meet a demand or requirement; short in supply: Fresh vegetables were scarce during the drought.
Hard to find; absent or rare: Steel pennies are scarce now except in coin shops.


sup·ply ( P ) Pronunciation Key (s-pl)
v. sup·plied, sup·ply·ing, sup·plies
v. tr.
To make available for use; provide.
To furnish or equip with: supplied sheets for every bed.
To fill sufficiently; satisfy: supply a need.
To make up for (a deficiency, for example); compensate for.
To serve temporarily as a substitute in (a church, for example).


So anything with a limited supply is by defition scarce.
Anything scarce is by definition limited in supply.

supply can be limited to resources which are not scarce, i.e. they may be plentiful
if it is not plentiful then it is scarce, that's what scarce means.

Can you give me an example of either something that is scarce but supply is not limited, or vice versa, supply is limited but the resource is not scare?

the definition you have highlighted from Dictionary.com is very loose and I've already highlighted the difference between "scarce" and "limited in supply", as it relates to the volition of the holder of the resource....read it carefully and you'll get the difference.

Go look it up in an economics book, scarcity will be in Chapter 1, Suppy and Demand will be covered in a later chapter

Can you give me an example of either something that is scarce but supply is not limited, or vice versa, supply is limited but the resource is not scare?

I think the argument you are trying to pursue here relates to something being "necessary but not sufficient", i.e. if something is limited in supply it is necessary that it is scarce, but it's not sufficient as the owner must have a volition in the decision to either supply or not supply.

Originally posted by Cyclone
...Can you give me an example of either something that is scarce but supply is not limited, or vice versa, supply is limited but the resource is not scare?
Diamonds, and Titanium (of the top of my head).

Diamonds are not scarce, but supply is very restricted in order to artificially maintain a high price.

Titanium is not scarce (it's extremely common) but high processing costs mean that supply of "refined" or usable titanium is limited.

Well, that's a starter for ten...

:)

Originally posted by jimmy


Plus in Sheffield I've noticed that there are literally thousands of new student beds becoming available in town (The Forge, Unite) as well as the new Student village. Students are likely to prefer living in these places than grotty houses in Broomhill/Crookes so I see a lot of BTLers having empty houses...



I take it you have not looked at the prices these student villages charge? £70 will get you a 1 bed en-suite. In Crookes 45 a week will get you a double room in a shared house with 2 others. There are less people to share with too as thises student villages depend on 5 students sharing a flat.

Originally posted by BertieBasset
Go look it up in an economics book, scarcity will be in Chapter 1, Suppy and Demand will be covered in a later chapter

As I read it, Cyclone said 'Supply and Demand' was the first rule of economics. ;)

My Economics book does indeed start with scarcity, but 'scarcity' is a concept, which forms part of the foundations of the 'Supply and Demand' rule.

The book waffles on for 3 chapters before defining any rules - the first of which is illustrated in a flow chart of supply and demand for goods and services.

Your argument equates to claiming 'mass' is a rule, whilst Cyclone points out F=ma or weight=mass x acceleration due to gravity :loopy:

What is it with the "Moving to Sheffield" forum at the minute? I think it needs renaming "the petty argument" forum. :hihi:

Originally posted by march
What is it with the "Moving to Sheffield" forum at the minute? I think it needs renaming "the petty argument" forum. :hihi:
Oh no it doesn't. ;)

:hihi:

Originally posted by foo_fighter
Diamonds, and Titanium (of the top of my head).

Diamonds are not scarce, but supply is very restricted in order to artificially maintain a high price.

Titanium is not scarce (it's extremely common) but high processing costs mean that supply of "refined" or usable titanium is limited.

Well, that's a starter for ten...

:)

Those examples only work because you measure the scarcity at one point in the system and the supply at another. Measure it at the same point and they are directly related. Supply is artificially limited as you say, that means to the consumer that diamonds are a scarce resource. To DeBeers they are not scarce and neither is the supply all that limited.
Titanium ore is neither scarce (as you said) nor is it's supply limited, you can go and buy as much as you like, and it probably won't cost much.
Refined titanium is both scarce and it's supply is limited because of the high processing cost of producing it.

Where goods are scarce it is necessary for society to make choices as to how they are allocated and used. Economists study (among other things) how societies perform the optimal allocation of these resources -- along with how societies often fail to attain this optimality and are instead inefficient and how to solve this problem. The term inefficiency has several meanings depending on the context in which its used: Economic inefficiency refers to a situation where we could be doing a better job, i. ...

For example, we may all want to own gold jewelry. However, the amount of gold available is limited, so it is necessary to make choices as to how it is allocated. In a market economy, this is achieved by trade. In the market, individuals and organizations (such as corporations) trade resources amongst themselves, reallocating resources to where they are most wanted by those with purchasing power. In a smoothly operating market system, the rate of exchange between different resources, or price will adjust so that demand is equal to supply. One of the roles of the economist is to discover the relationship between demand and supply and to develop mechanisms (such as pricing, incentives, or penalties) to achieve an optimal outcome (in terms of consumer welfare). Jewellery (spelled jewelry in American English) consists of ornamental devices worn by persons, typically made with gems and precious metals. ... The supply and demand model describes how prices vary as a result of a balance between product availability at each price (supply) and the desires of those with purchasing power at each price (demand). ...



I'll concede that they are not precisely the same thing, but one is meaningless without the other and in the context of this conversation they could be interchanged without changing what is said.

Is it any more meaningful for us to talk about the scarcity of housing rather than the supply? I doubt it.

So, to recap, do I think house prices will drop?

In Sheffield: probably not, as house prices here still bear some relation to reality and to the average person's ability to afford them;

In Leeds: almost certainly, because house prices in recent years have got so stratospheric that normal working people cannot afford them. Just wait till the interest rates rise.....

StarSparkle :)

In Sheffield: probably not, as house prices here still bear some relation to reality and to the average person's ability to afford them;


So the "average" house in Sheffield costs £126,801 with a terrace just under 100k

(http://news.bbc.co.uk/1/shared/spl/hi/in_depth/uk_house_prices/html/cg.stm)

... although note this has dropped 5% in the last quarter

and average wages are about £21,000
(http://money.guardian.co.uk/pay/story/0,13871,1415864,00.html)

So even someone earning the "average" (which is skewed anyway) has to take a 5x mortgage to buy a terrace.

I don't think that's realistic... and with all these new "city living" (LOL) flats about 120-130.. The average (or even someone on 30k) is paying 4x salary.

It's going to come down like a pack of cards...

It's still possible to buy a 3 bedroomed house in a relatively good area in Sheffield for under 100,000.

In these days, that's good going.

Returning to the Leeds housing market (where I was trying to buy a house for a couple of years, so got to know the market quite well), there's NOTHING available for under 150,000 - 200,000 that I would even consider living in.

Either you'd get a house so small you'd barely be able to 'swing a cat in it', (forget having any possessions to store) or it would be in a neighbourhood so awful you could expect to be burgled the day after moving in.

Honestly, to get a half-decent house in a reasonably safe area that you could actually feel relatively safe living in, you're really talking 200,000 at the very MINIMUM. Bog-standard 3 bedroomed house, without requiring barbed wire on your roof and steel grilles on your windows and doors to feel safe. I kid you not - that is standard in some parts of Leeds - in even quite nice areas.

Personally, I think Sheffield still offers pretty good value for money in the housing market. If you don't think so, you really should check out the cost of housing in other areas.

StarSparkle

Originally posted by jimmy
So the "average" house in Sheffield costs £126,801 with a terrace just under 100k

(http://news.bbc.co.uk/1/shared/spl/hi/in_depth/uk_house_prices/html/cg.stm)

... although note this has dropped 5% in the last quarter

and average wages are about £21,000
(http://money.guardian.co.uk/pay/story/0,13871,1415864,00.html)

So even someone earning the "average" (which is skewed anyway) has to take a 5x mortgage to buy a terrace.

I don't think that's realistic... and with all these new "city living" (LOL) flats about 120-130.. The average (or even someone on 30k) is paying 4x salary.

It's going to come down like a pack of cards...

of course some people might save up a deposit. Thus not needing to borrow the entire amount from the bank.
Why is the average skewed?

I don't think we are likely to see a crash in Sheffield, more likely a period of stagnation or at worst a gentle decline for a few years.

Starsparkle: Is the job market any better in Leeds or does it offer the same sort of jobs as in Sheffield?

Cyclone: I meant skewed as it in median salary. You have quite a few very rich people above the average and lots below the average.

People might have saved a deposit, but banks have made it very easy to get a large mortgage with only a small deposit which has made the concept of buying a house that much easier. Plus you have interest only mortgages and self-cerficiation mortgages. At the end of the day, it's an individuals own personal decision to buy/rent but you have to look at a balanced viewpoint, not just what vested interests (Estate Agents) are saying.

People should save up a deposit, its good personal financial management to.

I'll be watching the economy in the next 12-18 months closely. If consumers stop spending, retail continues falling, we will have a steady rise in unemployment (as 70% of all jobs recently created are in the retail sector). Then who knows what will happen.

A month ago the Estate agents were talking about a Spring Bounce, then they said the Election was stopping people buying houses. House prices have fallen 11 months in a row. How long will everyone continue to believe these people?

Originally posted by jimmy
So the "average" house in Sheffield costs £126,801 with a terrace just under 100k...
... although note this has dropped 5% in the last quarter...
...and average wages are about £21,000...
...So even someone earning the "average" (which is skewed anyway) has to take a 5x mortgage to buy a terrace...

But you're "skewing" the facts too...

...many "low" earners aren't buying property, they're in rented (private or council) accommodation, so the "average" wage doesn't directly compare to the "average" property price…

…add to that the fact that most people get “joint” mortgages, so actually we’re talking about double incomes driving the property market (on the whole), and all of a sudden the picture looks a lot different.

:suspect:

Originally posted by jimmy
Starsparkle: Is the job market any better in Leeds or does it offer the same sort of jobs as in Sheffield?


From what I understand, house prices have always been somewhat higher in Leeds than Sheffield - but from about 2000 onwards (ironically, when we were house-hunting in Leeds :rolleyes: ) the gap grew really massively.

In the end, we realised we couldn't afford to move to Leeds - the deposit we'd have from selling our house in Sheffield wouldn't be enough to stop us from having to take out an ENORMOUS mortgage that in all honesty we couldn't afford, if we wanted to eat! :D

I know of quite a number of people who work in Leeds, but can't afford to live there, so they commute in daily from Sheffield, or Wakefield, or Bradford, etc.

As far as I know, there is less unemployment in Leeds than Sheffield, and it (Leeds Council?) seems to have managed to generate a general image of wealth and prosperity - but how far this is reality, I'm really not sure. Loads of the lauded jobs in the 'financial' sector are in fact effectively 'call-centre' type jobs, so they're not going to be brilliantly well-paid.

From looking in employment agency windows, it seems that the same job in Leeds would be paid at a slightly higher rate than it would in Sheffield, but not a vastly higher rate.

My experience of house-hunting in Leeds led me to think that 'normal, working people' were largely being priced right out of the housing market in the 'liveable in' areas, in favour of buy-to-let buyers, property investors generally, and the parents of students buying for their kids, who would then intend to sell the house on for a large profit after the 3 years of uni. Essentially all buying with a profit-motive, rather than looking for somewhere to live.

This 'investor-frenzy' is what has pushed Leeds house prices up to such ridiculous levels. :(

StarSparkle

Property prices have dropped. Are we going to see a crash like the one in the early 90's? I haven't a clue but I don't think so.

The interest rate hikes last year were not massive by comparison with what went on in the 90's so I think the sensitivity of the market place to the interest rate shows how massively overstretched people are financially these days.

I have a suspicion that a significant part of the economy of this country rests on interest from debt at the moment so they do have to be very careful what they do with the interest rate. Put it up and up to a certain point people at the end of the chain (the ones scrabbling round for crumbs from the fat cats so they can pay the interest payments to other fat cats) will continue on.

There must be a breakpoint though and I bet the fat cats know exactly where that is to serve their best interests and put the interest rate to match.

There were comments earlier about estate agents not understanding that property prices have fallen continuously in the last 11 months.

My experience of the estate agent I used last year is that he was a waste of space. I sat in a chain for over four months which fell through halfway through the fifth month. It took me 7 months to get rid of a 2 bedroomed flat. I was told one piece of bull**** after another during this time period to the point where I simply turned round and tore into him verbally for it. For this I paid a four figure sum. My solicitor's bill for all the work, including a necessary correction to the lease and all the work on the failed sale, came to less than half what I paid him.

Estate agents have a vested interest in keeping the market 'bouyant' (read overpriced and worthless) because they charge anywhere from 1 to 2.5% for selling a property.

Couple that expense to stamp duty and you can see where things start to seize up when people try to trade up by selling one proerty and buying another.

I hate to deflate a conspiracy theory, but interest rates are set by the bank of england with the aim of controlling inflation, not be some anonymous "fat cats" who simply want to get fatter.

And prices have not fallen consistently over the last 11 months, have they fallen at all, or has the rate of increase fallen? I think it's the latter across most of the country, which is not the same thing at all.

I wouldn't say it was a conspiracy theory. Estate Agents are paid on commission. They are more than likely to want house prices to rise and rise to 6/7/8 times the average salary.

Unfortunately the "illusionary" wealth that this creates along with 1 trillion pounds of non-mortgage debt is not healthy for the economy in the medium to long term. As I said earlier, high house prices are not actually beneficial to people. They have to pay more to trade up.

In the next couple of years we are going to see utility bills increasing again, council tax being rebanded and maybe higher taxes. I hope people have factored this into their finances.

The Bank of England does indeed have to control inflation. So now as it is at 1.9% and on the verge of breaching the 2%, hopefully they have this in control over the next 18 months.

estate agents don't control interest rates though. It was interest rates you were talking about being manipulated to make money for fat cats.
I agree that estate agents have a vested interest. But property surveyors and mortgage companies (well to some extent) don't. Estate agents can't just make numbers up completely out of the air or mortgage companies will refuse to lend that much as the house isn't worth it.

Hi there,

What's the state of the Sheffield housing market in your opinions?

I've noticed that quite a few sellers online have properties marked 'REDUCED' that have clearly been on the market for a while (no leaves on trees in pictures etc.) I've been looking at the average house price graphs on upmystreet.com, and it does look like the astronomical growth of the last couple of years is slowing pretty much everywhere - Barnsley, Stocksbridge, Sheffield itself....

In London, prices are definitely softening. I have a friend who is an estate agent, and he reckons most people are being forced to accept offers quite a bit below the asking price. Is this going on up there too?

D1zzy

I think generally speaking, it's slowed down, but I think that only means that it now only takes longer to achieve a good price.
I recently saw a house reduced from £179,950 to £175,000. I phoned to ask about offers, and they were at £178,000. So why the reduction? They may as well have left it as it was!!

We recently sold our house. I found that prices weren't necessarily lower, but it just took longer than expected to sell out place - about 6 weeks - which I suppose isn't too bad, but we were expecting to sell within a week or so. Also the offers were not massively over the asking price as they were 3 years ago.

I recently left a post about closed bidding in Sheffield and how that forces higher prices to be paid.

The market must be slowing down as it just cannot keep rising as it has done. However, having just bought my first house I can say that even at the moment its still a buyers market.

Sheffield has quite a few growth areas and these seem to be slowing less than the really expensive, popular areas.

I definitely think that the recent increase on the cap for stamp duty has put a bit more life into the market though - that was a good move!

I looked at a few houses in Dronfield which have been on the market for sometime. All have dropped in price and they're still for sale.

I'd say prices are softening as far as the asking prices not being met.

my brother is moving, he had an offer at the asking price within 1 week and accepted it.

It's in the S25 postcode area, so about 15 miles out of town.

Is the market softening here?

Yes yes yes yes yes yes yes yes yes, at least in my experience.

In London things have gone nowhere for about two years.

Sheffield has remained bullish, and even went totally stupid last summer, but now things are not the same.

On the one hand you shouldnt pay over asking for a house, but bear in mind that the mentality here is to expect 10% over asking anyway, but on the other let http://www.nethouseprices.com/ be your friend to see exactly what the vendor paid for it and how much the street went for last summer at the peak.

My advice is to reduce last summers completion price by 10% for a fair price now and make that your final offer.

You will probably take longer to buy doing this but at least you wont feel as though youve been fleeced.

The market in Sheffield is soft, its just that the agents, the vendors and a number of posters on this forum are still in denial :)

Just read the papers, check out this link if it works:

http://www.rightmove.co.uk/template/publicsite%2Caboutus%2CRTPRArchive.vm

If it doesnt go to rightmove.co.uk and look for news.

Rightmove is a site run by estate agents, these people have an interest in ramoing up the market.
They clearly state house prices will not move for at least 7 years.

And somebody will be along in a minute to say Sheffield is different........

Cheers

d

rightmoves is one of the more pessimistic predictions, but virtually all of them at the moment predict a continuing slowdown for some time. They don't all predict 0 growth like rightmove though.

I thought that would probably be the case - good to have some confirmation though.

Actually I thought rightmove was quite optimistic compared to some - there were predictions of a 20-30% crash earlier in the year from pretty reputable sources. Even the RICS are being wary in their May 2005 survey - and they've got an interest in talking the market up! I quote:

"The froth has come off the market. Choosy buyers can now afford to bide their time as available property has risen by a quarter in the past year. Sellers must adapt their behaviour to account for the fact that boom conditions of recent years have come to an end."

Slowdown or even stagnation does seem more likely than a crash though... but let's face it, prices just couldn't keep jumping 20% in value in a year - that's just plain ridiculous. A fall of 10-20%, or stagnation until wages rise a bit (perhaps more likely given that interest rates are low), would bring wages & house prices more in line with each other. Hopefully it'll be a happy medium which benefits 1st time buyers by deflating house prices by a significant amount, without hurting home owners with very high interest rates.

a crash would suit me fine, but i'll settle for a slowdown for 4 or 5 years.

I think most of the 'crash' predictions have been changed to stagnation now, halifax and a few others are still predicting 2 - 3 % for the forseable future, whilst rightmove says it will drop to 0%.

To be honest 2 - 3% isn't really a correction, it's in line with general inflation, so leaves the bottom end still largely out of reach for first time buyers. Although I suppose in 10 years the average age of the first time buyer might be closer to 35 than 25, with concommitantly higher average wages.

Prices are coming down, as buyers cant afford most propeties any more, but sellers are still reluctant to move the price, this is usually down to the agents giving wrong valuations in an attempt to get their business.
I heard one valuer even admitted to giving high valuations as a rule, as most people believe what they hear as they want to believe they could sell for that, not thinking that the agents are just keen to get their property on their books , then to find out they have to reduce, but the agent dosen't care as long as they get their commission. We have heard people say, they are using that particular agent becaouse they gave the highest valuation..........
We have many clients who this has happened too who find they are stuck with no viewings or no offers month after month.
Many local agents are now fighting for business, even trying to poach ours now, I think that says a lot, but it makes me laugh as don't they realise our clients are not lovers of agents in the first place.

I put my 2 bed flat at wadsley Park village for sale 4 weeks ago. It was valued at 5k more than I thought by Winkworths, though Blundells wanted to put it on at 10k below that figure. I went with the higher valuation and it was sold 6 days after the sign went up to a cash offer at the asking price.
You may say that is an exception but loads of 3 bed terraces in Hillsborough are going for 5 to 10k above asking.

The rush has settled down but good property is still selling well.