Property prices thread

[Josquius]

New in the I will believe it when I see it files-

https://uk.finance.yahoo.com/news/uk-house-prices-beginning-end-050001846.html

I admit that it's an open question whether there will be meaningful fall in property prices, but the rise of them must be coming to an end, for most of this year, at the very least. I can't see how the upward momentum could be kept unless by significant state subsidies.

As I've mentioned before, IMO we're currently in the midst of a big national game of musical chairs.
Loads of people are escaping the place they had to live as it was close to work (Mostly London but also other cities) and/or using the disruption of covid as an excuse to make a big change that they might otherwise  have all made at more spread out times decades down the line (if they decided to make it at all).
The numbers involved here are however finite and have to be burned through eventually leaving behind a normalicy which is somewhat different to before; higher prices in nicer but somewhat more remote places, a bit less demand in cities, etc...

Buuuttt.....
When demand in many areas was already 4000% of affordable capacity (number pulled from my arse) then a 500% drop isn't going to mean much.
Likewise buy to let remains a thing. I've seen no signs this has dropped. I can guess at arguments why it might have gone up even.

I can see things dropping in your area. Though elsewhere....

Then on top of all this is of course brexit and Ukraine which shouldn't help prices.

[Tamas]

Yeah we may be limited in the downside because there still must be lot of pent up demand holding out (like us). But on the other hand widespread buy to let by small investors mean rising interest rates will dissipate profit margins for a lot of people. Won't be able to raise rents too high in a recession while the mortgage the poor schmuck renter paid for you will have its interest rise.

[Josquius]

In more crash ho news....

https://citymonitor.ai/housing/renting/london-landlords-sell-houses-property-bubble

[Sheilbh]

oh no not the landlords

[Jacob]

oh no not the landlords

 

[Tamas]

It's weird how in the UK it is felt necessary to explain the benefits if 10 year fixed mortgages like this when in the US (and Hungary) full fixed term is the default people consider and usually take:
https://www.theguardian.com/money/2022/jun/18/10-year-fixed-rate-uk-mortgages-value-loans-deals

I blame people relying on mortgage broker advice instead of thinking for themselves :p

[crazy canuck]

Full fixed term is very rare here.  As is a ten year rate.  Mainly because other options have been much better.  Holding a variable rate mortgage over the last 20 or so years has been thhe wise choice.  And so it is not that surprising that this sort of analysis would be helpful.

[Zanza]

I fixed ten years on my mortgage because at below 1% interest rate, there seemed to be very little upside opportunity.

[Maladict]

Yeah, I got 30 year fixed at 2.0 in 2019, because why not.

[Josquius]

So tempted to buy that rental property right now 🤔

[HVC]

So tempted to buy that rental property right now 🤔

I thought landlord's were evil?

[Josquius]

So tempted to buy that rental property right now 🤔

I thought landlord's were evil?

I never said that?

They're doing whats logical and chasing a gap in the market.
What is wrong is that this gap exists and it is profitable to get a buy to let mortgage.
I will support politicians closing off the feasibility of making money in this way but while it is possible I see no moral issue with those who chase it in general - exceptions of course for those who know they're gouging to house people in dangerous houses et al.

[Sheilbh]

I, on the other hand, have said landlords are evil - and I stand by it 

[Tamas]

So tempted to buy that rental property right now 🤔

I think you would be buying the top.

[DGuller]

I don't get the logic of having variable interest rate mortgages.  With fixed rate, you can always ratchet down your rate and refinance if for some idiotically absurd reasons fixed rate goes down to 1%.  With fixed, you know the monthly expenditure you're committing to, and that commitment will only stay the same in worst case.

With variable rate mortgages, you can be thrown out of your house when your payments balloon, and usually at the worst time for you to be thrown out.