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How far will Sheffield house prices drop?

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Most sales at the moment are 'distressed' in some way, either a repossession or someone having to sell for some good reason. Such sales have always been at below market values and were regularly about 10% of the market. Now they are about 80%, because others are not selling, and thus are skewing the official figures making falls seen to be dramatic. I know of a number of people who in a normal market would be moving but are staying put because of the lack of suitable mortgages and the turmoil in the market. These people will sell when stability arrives and will probably accept a 15% fall in the value of their homes.

Say for example a 3 bed terrace at Crookes in good order, a year ago valued at £165,000 tops. Take 15% off and you have about £140K. Now I know not all people would, but there is a strong rental demand in Crookes from young professionals and students. Students pay about £3k a year each, four students is £12k. Even if you have borrowed all £140k at 8% that rental income covers your mortgage and so puts a potential floor to the value of the house. Any talk of a 50% fall in an area like Crookes is therefore nonsence as at £80k value the rental return would be nearly 20% and every investor in the UK would want one.

Remember the last crash when the Southeast fell by 40%? I lived in Broomhill then and prices fell by about 15%. The country's average will be more than Sheffield because we don't have the same oversupply situation, except in 2 bed appartments - and student's parents will soak that up over the next two years, if you expect a real bargain then be prepared to buy something others wouldn't.

Best advice, location, location, location, buy what you can afford and remember its a home first and an investment second.

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What doesnt seem to have been mentioned in this thread is that there are some out there who are unaffected by the recession.People who are well of and can afford to buy cash. Some people on our Rd did that and have renovated it over the last few months adding value.

If borrowing isnt a problem and people can get a mortgae then they will of course buy at the moment.

Only if they've had their brain removed.

Why would you buy now, next month will be cheaper.

This thread only looks at the doom and gloom and the worse case scenarios with people not being able to get mortgages.

We've not been saying that, we're constantly saying that people will choose not to buy even if they can. You just keep restating that anyone that can buy now will do, despite that being a case of just throwing money away, and despite the reality of the market showing differently.

Barclays Bank leant out more borrowing this financial year than it did last year.That came from the one of the advisers at Barclays Bank, so someone is getting money and will use it to purchase houses.

Someone got confused

http://www.newsroom.barclays.com/Content/Detail.asp?ReleaseID=1467&NewsAreaID=2

Barclays small business lending has increased, it's mortgage lending has not.

The mortgage deals that are out there are good ones .the cheapest at about 4.89% so with that in mind people are going to buy and demand will increase in Sheffield, but that is just my'positive' opinion.

 

And what's the arrangement fee and minimum deposit? You've got a funny idea of good I suspect.

Cumberland BS are offering 4.54% on a tracker rate, it has £1200 of fees attached to arrange it. The monthly payments on 100,000 are £560.

So that's less than it costs to buy a house in crookes, and the mortgage cost is more than the rent.

 

ukdobby - it doesn't take any guessing to see that prices are going down, next month will be cheaper than this month.

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ukdobby - it doesn't take any guessing to see that prices are going down, next month will be cheaper than this month.

 

Prices on av dropped 0.4% last month according to Nationwide,thats on average so you can say in some areas they didn't drop so it depends where you are buying,you can't say prices will drop,you can guess but its not a sure bet,if you are going to offer 100k this month what would you offer next month?95k?,afraid it won't work unless you prey on the desperates and to find the house you want not the price you wanna pay you could well end up with property you did not 100% want unless you are lucky.

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Some of the talk about how mortgages are available at good rates and therefore prices are going to stop dropping is somewhat confused.

 

The LTV levels being offered are drastically different to 1 year ago. A glance at the best buy table shows best you can get is 90% LTV and the rate is 6.1% not 4.x%. Those mortgages are available but are for remortgages and are for LTV's of 60-75%.

 

Short version is 1st timers will need to save £10k+ before even being able to get a mortgage which won't be as cheap as they'd think looking at the BoE base rate. How many people are going to be able to save amounts up to 50% of average yearly salary during a recession that we are entering with massive levels of personal debt?

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Buying a house isn't the same as buying a new jumper or some aftershave though. The savings could directly affect quality of life for the next 25 years

for a lot of people.

 

 

 

I can guess that prices will be lower in 6 months or a year and so you will save a lot of money by holding out for that long.

 

Your basically saying buy now because you can't predict the bottom of the market but you don't have to predict the bottom of the market to save money. You have to predict the bottom of the market to save the MOST money.

 

 

 

If you want to buy at the current prices you are going to lose money - end of story.

 

 

if i sell my house and i have dropped the price by £30.000 have i then lost money? yes... but if the house i purchase is dropped by£30.000, then have i lost money..no.

if i wait 12 months, and the market has recovered, my house will be worth more, but also the next house would have gone up again.

First time buyers could be advised to wait, but as i have said before, they may lose out if they have seen an house they wanted.

One last thing of interest...i only went to the bank to cash a cheque, and i was asked if i wanted to renew my mortgage, i thought there was all this talk about banks not lending money?

left me confused :confused:

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Prices on av dropped 0.4% last month according to Nationwide,thats on average so you can say in some areas they didn't drop so it depends where you are buying,you can't say prices will drop,you can guess but its not a sure bet,if you are going to offer 100k this month what would you offer next month?95k?,afraid it won't work unless you prey on the desperates and to find the house you want not the price you wanna pay you could well end up with property you did not 100% want unless you are lucky.

 

If that's how you want to play it then you can never consider housing an investment, as you'll only be guessing that the prices will rise in the long term.

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Prices on av dropped 0.4% last month according to Nationwide,thats on average so you can say in some areas they didn't drop so it depends where you are buying,you can't say prices will drop,you can guess but its not a sure bet,if you are going to offer 100k this month what would you offer next month?95k?,afraid it won't work unless you prey on the desperates and to find the house you want not the price you wanna pay you could well end up with property you did not 100% want unless you are lucky.

 

If that's how you want to play it then you can never consider housing an investment, as you'll only be guessing that the prices will rise in the long term.

 

It is only a guess but its a 100% guess that sooner or later they will start rising again,the 100 million dollar question is when,it is an investment as long as you're not desperate to sell which is common sense.

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You can't have it both ways.

I say that it's a 100% certainty that prices will fall next month, you claim that's just a guess.

You then say that it's a 100% certain guess that prices will rise in the long term.

 

Prices will rise in the long term, I can see that, and they will also fall next month, I can see that. If you want to pretend that they won't then go ahead and throw money away, but don't advise others to do the same.

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What doesnt seem to have been mentioned in this thread is that there are some out there who are unaffected by the recession.People who are well of and can afford to buy cash. Some people on our Rd did that and have renovated it over the last few months adding value.

If borrowing isnt a problem and people can get a mortgae then they will of course buy at the moment.This thread only looks at the doom and gloom and the worse case scenarios with people not being able to get mortgages.

Barclays Bank leant out more borrowing this financial year than it did last year.That came from the one of the advisers at Barclays Bank, so someone is getting money and will use it to purchase houses.

The mortgage deals that are out there are good ones .the cheapest at about 4.89% so with that in mind people are going to buy and demand will increase in Sheffield, but that is just my'positive' opinion.

One thing is certain, mortgage rates are going to get lower making houses even more affordable with the lower house prices, as long as you have good percentage equity in your home or a decent deposit your payments will be much lower.

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[/size]if i sell my house and i have dropped the price by £30.000 have i then lost money? yes... but if the house i purchase is dropped by£30.000, then have i lost money..no.

if i wait 12 months, and the market has recovered, my house will be worth more, but also the next house would have gone up again.

First time buyers could be advised to wait, but as i have said before, they may lose out if they have seen an house they wanted.

 

If you are going to trade up for a bigger house, the more expensive house may have dropped by a bigger margin than yours. For example 10% of £100 000 is

£10 000, but 10% of £150 000 would be £15 000 so there is a temptation to wait for the market to drop even further before buying a bigger house.

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One thing is certain, mortgage rates are going to get lower making houses even more affordable with the lower house prices, as long as you have good percentage equity in your home or a decent deposit your payments will be much lower.

 

The lenders are still being very picky about who they lend to.

Mortgage approvals down 72% for October

http://www.telegraph.co.uk/finance/economics/houseprices/3538545/UK-mortgage-approvals-down-72pc-from-peak-Bank-of-England-figures-show.html

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Prices will rise in the long term, I can see that, and they will also fall next month, I can see that. If you want to pretend that they won't then go ahead and throw money away, but don't advise others to do the same.

 

Where in my posts have I ever ADVISED,my posts voice my oppinion,aint that what a forum is all about?put my house on the market in June,got what I wanted last month,now tell me know all where did waiting pay off for anyone.

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