UK house prices

[cs00nnb]

Money to be made in properties

An extract from Jim Rogers' (Hot Commodities)

'Real Estate: , Housing is already too expensive to be much of an investment, at least in those places where you would be willing to live. (You've even missed the real-estate booms in the UK, Spain, Australia, New Zealand, and other countries where prices have accelerated beyond their historical average rates of increase.) U.S housing prices have been rising faster than the rate of inflation for more than eight years; home-equity values may be inflated by as much as 20 to 30 percent. In New York and Southern California, housing prices have doubled in the past five years. A massive speculative bubble in the U.S. housing market seems to be floating from coast to coast, and when it bursts (as bubbles always do)some serious pain is in store for the millions of Americans who have been borrowing against their home equity at record rates- $750 billion in 2003. The resulting loss in wealth could be between $2 trillion and $ 3 trillion, sparking an economic downturn reminiscent of the one that resulted when the dot-com sotck bubble went kaboom. Even if the air stays in the real-estate market, prices are way too high for investors to make alot of money.

I know the above extract is similar to what many of us have read over and over again, but when you feel and smell the element of truth about these articles, you can read them over and over again.

 

[chump]

"but when you feel and smell the element of truth "..if I was on my deathbed I would not get into or out of an investment on something as ungrounded as that..surefire recipe for letting your emotions trip you up...what do the numbers tell you..that's all you need to know..and actually I agree that for people not thinking very long term ,not adequately capitalised ,this is not the right moment to buy into property as an investment..there will be better opportunities ahead and at this time there are better opportunities to make better returns elsewhere..none of which means the Uk market is going to fall through the floor...it might of course, just as it might stagnate for the next 5 to 8 years while all this froth disperses...

 

[cs00nnb]

The first property exchange in the UK

Just read an article in the newspaper about www.Opromark.com

'Investors who want to enter the buy-to-let market can now buy shares in a home via the UK's first property exchange. It was launched yesterday, and allows a minimum investment of £1.

I dont know much about this as yet, but there are details on the site, and it will be nice to discuss this and hear opinions.

 

[chump]

Evening CS,
thanks for the link..I had heard about this generally , but had not got any of the nitty gritty...I have to say that when a market get's so overpriced /saturated/ mature call it what you will that it can't go any further on a fundamental basis then this is the kind of idea you are going to see coming forward ... I think I said my piece on UK property above ...if it's property that grabs you right now then look abroad ...much better prospects ...at best I see stagnation in the Uk ..the worst alternative I don't think most people would wish to consider ..there might be support forthcoming next April to the Uk market with the change to pension rules ,but I even see that has contextual ..that is a price holding action rather any upsurge in prices...
Cheers

 

[LION63]

I have just read this article and thought members might find it interesting.

Second-home owners under threat
MoneyAM

Families dreaming of a cottage retreat in the country may face a ban on buying second homes. Under a radical upheaval in planning law, they would be barred from buying a second house unless they plan to live in it full-time. The ban would be enforced by compelling anyone buying a property to apply for planning permission before they could use it as a second home. Councils would then have the power to refuse families the right to buy if they intend to live there only at weekends. There are a quarter of a million second home owners and hundreds of thousands more who hope to join them. Labour would have to be braced for charges of hypocrisy against ministers. Many members of the Government have more than one home. But new laws to block second home buyers will be high on the agenda of a rural quango about to be established by Deputy Premier John Prescott and Environment Secretary Margaret Beckett, ministers have confirmed. Housing Minister Yvette Cooper said the Rural Housing Commission will consider the 'case for Government intervention, through planning control or otherwise, on second homes'. Mr Prescott and Mrs Beckett are among ministers who own more than one home or have several in personal use. The Deputy Premier owns an eight-bedroomed home in his Hull constituency and has a grace-and-favour flat in Admiralty Arch. He also spends many weekends at Dorneywood in Buckinghamshire, a country house for the Chancellor of the Exchequer but currently passed to the Deputy Prime Minister because Gordon Brown does not want it. Mrs Beckett has a home in Derby and owns a flat in Westminster which she rents out. She also has a grace-andfavour Admiralty Arch flat. Children's Minister Beverly Hughes recently paid more than £200,000 for a second home in the Lake District, one of the areas where pressure is strongest for a ban on second home buyers in order to keep prices down for locals. The rural housing quango was a Labour election promise. But before the poll, ministers said only that it would provide 'affordable' rural housing though making new homes available in shared equity and cooperative ownership schemes. Its highly controversial role in curbing second home ownership has only been disclosed in Commons written answers from Miss Cooper. She was replying to LibDem Tim Farron, MP for Westmorland and Lonsdale, the constituency where Mrs Hughes bought her second home. Mr Farron called for 'changes to planning law so that an application for change of category of use of a residential dwelling must be made before a property can be purchased for the purpose of using it as a second home'. It is not clear if the proposed curb on second homes would apply retrospectively. Two junior ministers, Rural Affairs Minister Jim Knight and Farming Minister Ben Bradshaw, said in a Devon newspaper that the quango will 'report early next year on what further action we can take across central, regional and local government to combat this problem'. A second home ban could run foul of human rights law in the courts. The plan was condemned by Tories yesterday. Sir Sandy Bruce-Lockhart, Tory leader of Kent County Council and chairman of the Local Government Association, said: 'The idea makes no sense at all. It is interfering with the market. That rarely works and it erodes personal liberty.' He added: 'It is absolutely ludicrous that people buying a second home should have to seek planning permission for change of use. 'There is already discretion for local authorities to charge council tax of up to 90% on second homes.'

 

[chump]

Throw it into a limited company..and it isn't a personal second home any longer

 

[sp1]

Hi all, ive been following the topic of this thread on housepricecrash.co.uk does any one else post or lurk there??

 

[ducati998]

USATODAY.com
Mobile home madness: Prices top $1 million
Tuesday July 5, 9:37 pm ET


The crazy California real estate market has come to this: a million-dollar trailer.
A two-bedroom, two-bathroom mobile home perched on a lot in Malibu is selling for $1.4 million. This isn't a greedy seller asking a ridiculous amount no one will pay. (Photo gallery: Mobile home boasts of spectacular views)




Two others sold in the area recently for $1.3 million and $1.1 million. Another, at $1.8 million, is in escrow. Nearby, another lists for $2.7 million.

"Those are the hottest (prices) I've ever heard," says Bruce Savage, spokesman for the Manufactured Housing Institute. He says prices in another hot spot, Key West, Fla., top $500,000. As if the price isn't tough enough to swallow, trailer buyers:

Don't own the land. As with most mobile homes sold in Malibu, the land is owned by the proprietor of the trailer park, in this case, Point Dume Club.

Still pay rent. Not owning the land means paying what's called "space rent" that is as high as or higher than many mortgages in other parts of the USA. On the $1.4 million trailer, space rent is $2,700 a month.

Can't get mortgages. Since the buyers don't own the land, most of the mobile homes are paid for in cash or with a personal property loan that usually amounts to $100,000 or less, says Clay Dickens, mortgage loan agent at Community West Bank.

Why would anyone pay seven figures for a trailer? It gets you more than the typical mobile home. The $1.4 million trailer is in a gated, guarded community with a shared tennis court and panoramic views of the Pacific Ocean. It also is on a larger-than-usual "triple-wide" lot.

Buyers are willing to pay such prices just to get into Malibu, where the average list price is $4.4 million, says Coldwell Banker broker Rick Wallace.

But, it's still a trailer with a modest kitchen and faux wood floors. Many still have trailer hitches attached.

Sellers couldn't be happier. Charley Chartoff, a 29-year-old Coldwell Banker Realtor, is selling the $1.4 million trailer after living there about three years. Chartoff won't say how much he paid, but neighbors say prices have climbed about threefold in that time.

Developers are partially driving the rise. Janet Levine at Maliblue Holdings has bought several old homes and is installing high-end "mobile villas" to put up for sale. Levine and others bristle at the term "trailer." To be permitted in the park, the home must be perched on piers (a high-end version of up on blocks).

Some neighbors, though, can only marvel at the prices. Longtime resident Jim Schwartz, 92, says he got an $800,000 offer for his trailer home, which is not for sale. He declined. But, "You come to me with $1 million, and we'll talk about it," he says.

 

[chump]

"Why would anyone pay seven figures for a trailer?" ....your family home is 500 meters away on any expensive plot..you have more money than you could ever need...and you need a place to park your mistress so that walking the dog becomes the highlight of your day ...easy to figure out when you know how ... my middle name is Sherlock ! ..we validate this theory by counting the number of dogs parked outside these trailer homes in the evening and early in the morning ...

 

[chump]

To the man who pm'd me off this thread a long time ago re Spain....

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/04/25/cnspain25.xml

I recall I said to wait for at least 12 to 24 months for the accident waiting to happen ...you can start sifting the rubble for what you want from this point on, but bear in mind time is on your side in this...should make the US look tame by comparison.

No surprise in all this...the average punter is no better than a kid with a sweety jar ..and when the peeps controlling the jar are economists wearing central banker suits possessed of precious little commonsense in how to control little Johnny then you don't need to be able to read the future to know that you are going to see a major accident.

 

[Atilla]

To the man who pm'd me off this thread a long time ago re Spain....

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/04/25/cnspain25.xml

I recall I said to wait for at least 12 to 24 months for the accident waiting to happen ...you can start sifting the rubble for what you want from this point on, but bear in mind time is on your side in this...should make the US look tame by comparison.

No surprise in all this...the average punter is no better than a kid with a sweety jar ..and when the peeps controlling the jar are economists wearing central banker suits possessed of precious little commonsense in how to control little Johnny then you don't need to be able to read the future to know that you are going to see a major accident.

I have a question about house prices in the UK.

Are we expecting rates to rise and house prices to ease off in 2008 or will the continued price increase - continue...

Basically, is it better to buy this year or wait for the next to buy property in the UK?

All opinions would be appreciated.

 

[zambuck]

I would suggest that following should be considered.....

£ $ Rate...............Should be 1.5 or so
Rate...................Can bank cut the rate?....Yes it may be in few months.
Immigration..........Will continue - Tories or Labour.....Has NEVER Stopped.
China..................Many buying properties here...
India...................Do
Housing Shortage....Yes
Broadband.............Allows people to be based away from Office
Urban lifestyle........Crime....Gangs.....Crowds
Rural Lifestyle........Preferred?...Where would you be?

What would you do...???

This is my opinion.....Please do NOT make any decisions on this....

regards

 

[Atilla]

I would suggest that following should be considered.....

£ $ Rate...............Should be 1.5 or so
Rate...................Can bank cut the rate?....Yes it may be in few months.
Immigration..........Will continue - Tories or Labour.....Has NEVER Stopped.
China..................Many buying properties here...
India...................Do
Housing Shortage....Yes
Broadband.............Allows people to be based away from Office
Urban lifestyle........Crime....Gangs.....Crowds
Rural Lifestyle........Preferred?...Where would you be?

What would you do...???

This is my opinion.....Please do NOT make any decisions on this....

regards

Zambuck old boy, but you have not given me your opinion.

Be generous will house prices go up or down based on your considerations in 2008.

Is there financial benefit in holding off a purchase or do you take the view house prices will continue.

My opinion is that house prices will stagnate or possibly fall. Or that at least it will be more of a buyers market next year.

Feel free to commit your self. Your points above are all good consideration. I promise I won't knock on your door for a loan if it goes pear shaped.

 

[laptop1]

I know who will be first to sell. The buy to let people, who think they are mr big property tycoons with 1or 2 house...I seen it happen to my uncle, he was a clever man a financial adviser, lovely big house 5 bed house, he build a few house and made good money, until the late 1980s, he decide to build 5 houses with a partner, guess what happen, the market went dead nothing was selling, he dropped the prices, still couldn't sell. he ended up bankrupt, and also ended up selling his lovely 5 bed house very sad but true storie

The crash will happen when nobody expects it.

 

[Priceman]

My opinion is that house prices will stagnate or possibly fall. Or that at least it will be more of a buyers market next year.

You know I am of the same opinion... but... people are still buying! I am just selling a second home as I am getting nervous, (sold in 2 days) I did the same in 1999... that house has doubled again since then! With the average price over £190k how can Joe Public afford that? They are borrowing beyond their means. Hhhmm, isn't this what has just happened in the good ol' US of A, correction rather than crash?

Credit nations, easy money given by the banks.

My opinion FWIW;
If you are looking long term then don't worry about any correction but would be a real pi$$er if you got into negative equity with high interest rates!! Buy overseas maybe. There is still a housing shortage but we also live on a small island which is pretty damn cramped too. While UK PLC is in relatively good health they may climb short term but not a great deal. I'd rather get a better return on me money elsewhere.

Just my 2p, but what do I know.

 

[zambuck]

Atilla...

A line went missing in my reply.....My laptop was slow and erratic.....and somewhere it happened.....it was line below....

I believe that house prices will keep rising until the rates reach 8-9%.

Indians from India and Chinese from China who do not know what to do with their spare money are saying why not buy in UK.....And are doing it.

Some Indians I know will come and buy 300K house, rent it and go back....This is happening more and more.

Yes locals and young may not afford houses or flats, but demand is there from external sources so it will keep on rising, but at reduced rate.

Don't go out any buy because I said it.....And yes if you come knocking you will have to find out behind which door I will be on that day..!!

 

[chump]

still asking the wrong questions ..LOL

 

[Atilla]

still asking the wrong questions ..LOL

Yep still trying to learn...

 

[Atilla]

Thanking you all for your insights.

I think it might be prudent to hold off a little.

My thinking is if house prices continue to rise come what may they'll rise in 2009 also so the potential loss in the gain will be neither here or there. If they do ease off or drop then that's likely to be a little more significant.

Once again many thanks.

 

[hornblower]

one of the real problems is
that when house prices are going up ,
people are happy to except the increase in price
and if the house has gone up say £20,000 in 6 or 8 months thats fine

but if its gone down by the same amount they don`t want to know
they will hang onto the higher price for a long time , thats why I think prices will not go down at the same speed as they went up

when I used to go and view a property

after I had looked around , and told them, I would only buy it if the price was right ,
and if it did not meet my price, then I would move on to the next one
I asked the question
what will buy it ?
you could save £10, 000 to £15,000 that way and save a lot of time