House Prices Rise
Tue, 05/25/2010 - 17:08
by the.gofaWhilest reading some property thing I found on the net it said house prices have an annual 9.7% increase in there cost. It then said the average home has risen by 0.7% since February hense making the average house cost us £205,598 and they still say it is going to be a tough year ahead for people buying.
Has anyone else noticed that house prices seem to be rather costly. I mean to say when are they going to come down to a suitable level where people can afford to buy a home or even buy it to let without having to worry so much.
I can remember that at one time you could put 5K down as a deposit but now you need 10K + .
It makes me think should I buy a place now and hope for the best or hold out.
Feed back from all would be great
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How long can house prices rise for?
For instance in my town (Witney Oxon) the house prices continue to rise even theough the average salary is too low to rent let alone buy a house. Also people are being made redundant in manufacturing and there is no new work for them.. Is it just a matter of time before we have a crash?
I am also worried about oil prices, and inflaton on the economy. then there is the fact we are loosing so many jobs to abroad as labour is cheaper. I do think we are heading for a small recession and with it lower house prices, but that is my opinion.
We should tax second homes a lot IMO. As wealthy people buying them means normal working class people cannot find a house to buy. I also don't see why I should move away from the area I was brought up just so I can afford a house when the lazy cavs and immigrants get homes from the government.
I live in the UK by the way and yes I have had a good eduction... It is just where i live it is expensive as people buy houses here as it is a country type area but is an easy commute to london.
There are pockets around the country that are grossly overpriced & under strain. Boston for example has had a month or two of decreasing median prices. Most areas have also seen a dramatic rise in homes available for sale & a simultaneous decrease in homes sold. However, nationally, fundamentals are not horribly & excessively off the mark.
To address your geographic area, people are obviosly making enough money to bid up the prices of houses- even if you are not. Thus, I am skeptical of your claim of the average salary being too low to rent let alone buy. Think about your claim more carefully & you should see the paradox.
In addition, while your town may have some manufacturers that are shedding jobs, I doubt that they are the only or even the biggest employers. Think about it. If everyone in your town were worried about being laid off or having hours or wages scaled back, would the the growth rate of demand outpace the growth rate of supply? (this causes prices to rise). In the picture that you paint, people should be begging to get out of their houses & no one would be willing to buy. Consequently, prices would have to fall to a new market clearing level. But you claim that they are rising.
Look at other factors that are restricting supply- zoning ordinances, impact fees, dilapidated infrastructure, poor municipal services, etc.
Your macroeconomic concerns are also ill founded. While high in nominal terms, oil is still very cheap in real terms by historical standards. Besides that, the US consumes less per unit of output now than ever before- a benefit of replacing low skill manufacturing labor for high paying service sector jobs. In addition, higher oil prices now are good for the long term. They mean more conservation (less demand), higher discovery efforts (more supply), more research into & use of alternatives (substitution). We just need to endure some short run pain to earn these long term dividends.
Inflation, again by historical standards, is very low & the new Fed chairman, ben bernake, is a bigger inflation hawk than was alan greenspan. He is therefore more likely to act sooner & with more force to head off inflationary pressure at the pass.
As for jobs, the only jobs going overseas are the low wage, low skill jobs that will soon be replaced by automation. So, the jobs can go bye-bye now or later, but they will go. While these jobs are waning, the high skill/high pay jobs such as medicine, engineering, & finance are growing- these are the people who are able to price people like you out of the housing market. The moral of this is to get yourself in school & do something that commands a premiuim from the market.
Your tax on second homes is a stupid approach to increasing affordable housing for the working class. Do you think that people who can afford vacation homes are buying them in working class neighborhoods is rust belt cities?
To address your comment "I also don't see why I should move away from the...House prices may rise, but is there a limit to how much a flats price can rise.?
i live in an upstairs flat and the one below is for sale. i was thinking of putting in an offer but, as i believe prices will not rise much more and may even drop at some point, it seems to me that flat prices cannot rise as much(percentage wise) as house prices as they have limited value compared to houses, and therefore not as valuable. So do flats have limited value compared to houses??? WHAT DO YOU THINK , MISTER????
flat prices can certainly rise as much as house prices. 99% of the time you are paying for the location as much as the bricks and mortar and flats are just as likely if not more so to be in a desirable location. OK - you cant extend them or do the garden, but they can still be extremely pricey. Now that less and less people can afford houses, the demand for lower price flats will rise even more, and hence the price will be pushed up. The house price generally is expected to flatten out or even drop in the near future (but who knows), so now might not be the best time to buy a flat or house for investment.Why is the media reporting a.rise in house prices and say next year we will be back at the 2007 levels soon?
I thought thats what caused the bubble to burst,inflated house prices and now they are saying we are getting back to expensive houses,yet there is unemployment,banks not giving morgages and low wages,especially in northern ireland.
What the hell is going on??????????
The people that prediced the "housing bubble" bursting when it did also predict another 20% drop in northern ireland next year.
They are simply trying to talk up prices to another bubble. Like you said, there is unemployment and uncertainty in the jobs market. The so called ' experts' are saying that this recession is going to be a W shaped one. We dip into a recession, we start to climb out and then dip again.
The last property boom was built on funny money, fairy dust money, it was money that we hadn't earned. It was debt.
The only property that is selling at premiums is multi £million houses in London that are bought by foreigners who use off shore companies to buy them and save on stamp duty. London is the world's capital for money laundering by the super rich.
I should imagine that house prices in Northern Ireland are going to stagnate for years to come. Certainly until the country has paid off some of its debt and the £ has recovered from terminal decline. The country is in a very different position today than it was in 2007.Will house prices rise in 2010?
I want to buy a house in the uk while the prices are still low from the credit cruch. But i dont want to rush into it. But , when do you think it will be a good time to buy? Will the housing market rise in 2010, or the end of 09?
No-one can guess that.The idea that house prices have started to rise is an outright lie, right?
I just don't believe it. We are still in a recession and pretty much always house prices decline gradually over a period of three or four years after the recession starts. Its an 18 year cycle of 14 years of growth/stability followed by 4 years of decline. So Wouldn't recommend buying a house to anyone right now, house prices will fall further and the idea that there is a housing shortage is blown out of proportion entirely. Theres 850,000 vacant households in england alone.
Yes it's a lie. Put about by desperate estate agents. House prices will continue to fall also due to the time of year and because of growing unemployment.Are house prices rising at a ridiculous rate everywhere or just in the uk?
House prices are always rising, but now they are 11 times higher than national average earnings and they are expected to double this ratio within 5 years. Is it the same situation around the world?
Its happening globally.how much have house prices RISEN in real terms since 1992?
i ask this because up until 2008 house prices have been rising several times faster than wages. with every month that goes by now there is more news being printed that house prices have fallen yet again. surely this is just the market readjusting itself, making it possible for first time buyers to afford a house once again.
so, could anyone tell me how much house prices have risen overall since our last recession in both real terms and compared to wages.
1992-2000 prices were fairly static because the mid to late 1980,,s saw about 200% increases,2000-2008 saw about 200% increases--if you paid£100,000 in 2000 you sold for £300,000 in 2008.or if you bought for £100,000 in 1984 you sold for about £900,000 in 2008.The gains were substantial and out of proportion with other forms of investment,many people have become very rich from just owning a nice house.Pensions have performed disastrously during this time.The difficulty now is valuing a house--price is only about demand and supply.It doesn't matter if the house cost £1000000 to build if nobody wants it at that price then it,s not worth that money.It all depends on the length and depth of this recession and the information i have is that it will be prolonged with some disastrous financial news in the next monthWho creates the disproportionate rise in house prices?
Surely not Estate Agents!
This question for UK people.
People who are stupid enough to pay the disproportionate pricesCan someone comment on house price rise or fall in london?
We Have recently purchased a house in London but can't move into it(far off from workplace) and we don't plan to move there in future also. at present if wesell it off we r getting a
profit(£5000). The other thing is to sell it after 1 -2 years and rent it out now(tenants available). our mortgage will be covered by the rent
only doubt i have is if the market becomes static or the house prices fall down we will land upp in -ve equity
my partner views r if we r not planning to move into that we should sell it off now
my views r we should hold it as house prices always go up and we will make profit from it
what is the advice?
House prices will always continue to rise for 2 Economic reasons
1) There is a shortage of houses
2) Everyone wants to get on the housing ladder because the profits are high - creating the necessary demand to fuel the shortage
Don't worry about interest rates rising - this will only fuel demand more, not quell it!how much will uk house prices rise in 10 years?
How long is a piece of string? That's what you are asking.
I also remember when you could put 5K down as a deposit on a house but not anymore not unless you are buying a cardboard box with no parking.
The house prices have got very silly indeed but it is interesting just having a look now and again to see what things are going for.
Mouse
Mouse
Those days have gone when you could put 5K down as a deposit and get a mortage.
The house prices well, I don't think they even know if they are coming or going. It is just crazy.
William
William
Unless you are willing to compromise on your neighborhood or the quality of the house, it looks like we're doomed to pay exorbitant rates for a house.
I completely agree! How are we as young people supposted to buy a property? We work just as hard as the next person but it is becoming increasingly difficult to have anything to show for it! Buying a car is one thing but a house for most of us is just not a reality. Still, lets hope that all of this changes one day (I really would like a house...or two).
You need so much deposit to put down they have not got the money. For them to get a deposit they may as well take a loan out for the deposit then there is nothing to say they will get the mortage for sure.
I also have noticed that house prices are just silly. how an earth can a normal sized property be one price one year and the next year it is either worth nothing or three times more than what it was valued at the year before.
I think it is high time that house prices came down to a normal price range. That also goes for new builds as well. They only cost amear amount to build then the next year or in 6 months the price has gone up. It is just crazy.
We should get everyone to post a comment on here and send it off to our wonderfull government and get them to stand up and make things better or at least in such away that more people can get on the property ladder then that might help the economy to some degree.
marcus.
Marcus