benmorg

Jeremy Wrote: ------------------------------------------------------- > Most high street banks have only been offering 4 > to 4.5 times salary, so I don't really buy what > you're saying. but first-time buyers are now borrowing only about three times their salary: http://ftadviser.com/FTAdviser/Mortgages/News/article/20081014/43666f0a-99cd-11dd-8351-00144f2af8e8/Lending-for-house-purchases-hits-sixyear-low.jsp and that isn't going to change any time soon.

... and speaking of London estate agents, this is what Knight Frank says: http://www.thisislondon.co.uk/standard-business/article-23572535-details/London+home+slump+%27will+go+on+next+year%27/article.do "London home slump 'will go on next year' 14.10.08 House prices in London will continue to fall next year and not return to last year's peak until 2015, estate agent Knight Frank warned today, adding that "there is more pain to come" for the housing market. "Banks won't lend to each other because they don't know if they will be repaid, and consumers find it hard to get mortgages," said researcher Liam Bailey. "With the UK entering recession, unemployment is likely to increase, and disposable income and household budgets will fall." Knight Frank said houses in Greater London will slump by a total of 25.2% from their 2007 peak by next year."

local estate agent Wrote: ------------------------------------------------------- > Hope?? > > http://www.thisislondon.co.uk/standard/article-235 > 72439-details/London+house+prices+cut+by+20+per+ce > nt/article.do#readerComments look more closely. "Purchasers have been told that now is their best time to close a deal before the Government's ?37 billion bank rescue restores confidence to the market." told by whom? Answer: estate agent Peter Rollings, managing director of agents Marsh & Parsons. Not that estate agents would try to talk up the market...;-)

Michael Palaeologus Wrote: ------------------------------------------------------- > Well demographic projections seem to say that we > will continue to need new housing, especially of > the starter home variety. This being caused by > more single person households - which apparently > is the trend. the demographic trends are assumed rather than proven. They are based on the assumption that foreign workers will keep coming to the UK for work (unlikely in a recession) and that more people want to live in single person households, which looks decidedly questionable: http://www.thisislondon.co.uk/standard/article-23564666-details/More+extended+families+sharing+home/article.do The truth is that there isn't a dire shortage of property. If there was, rents would have risen faster than wage inflation, as sale prices have. In reality, rents have kept pace with wage inflation. The reason for high house prices was not undersupply but cheap credit and lax lending by the banks, causing a runaway bubble. We all know that the bubble has now burst. The most likely outcome from the house price crash is that values will return to historic income multiples. The only thing that could sustain prices at the current level would be a return to irresponsible lending, which aint gonna happen. Or soaring inflation. But with recession and unemployment looming we're more likely to see deflation next year than inflation. Arguably the deflation has already started with the housing market.

I've been cycling to work for 16 years, but only 6 months from ED. my route is dog kennel hill, camberwell grove, peckham back streets, burgess park, heygate estate, waterloo bridge. I can't stand walworth road or the first roundabout at elephant and castle, which is lethal. I get hotter and sweatier using public transport than cycling. Have never showered at work and never needed to. The trick is to wear shorts and only a t-shirt, except when it's freezing or raining, so that the breeze keeps you dry and sweat cant build up. Also a huge help to wear a proper high-tech cycling t-shirt, as the polyester fabric doesn't hold moisture and become soggy and smelly as cotton does. am happy to cycle in any weather, but crisp cold winter days are by far the best.

Keef Wrote: ------------------------------------------------------- > We are kind of in a rush for various reasons, but > we think we're getting a good price, and although > I'm sure they'll continue to drop, we're planning > on being there a fair while, so as long as we > don't over stretch ourselves we should be fine. > Besides, we've knocked them down a fair bit > already, and they're in a powerful position in > that they don't need to sell (they were renting > this place out, and I get the impression they own > at least another couple of places), so we don't > have the same power as we would if they had to > sell to move on in the chain. the best bargains are usually found by buying from a "motivated seller" who needs to move quicky and is therefore prepared to take a hit on the price. Landlords tend to be a lot more stubborn so it's harder work negotiating. Good luck with the move. Remember that if it falls through, there are plenty more fish in the sea, and although your personal circumstances may make you feel hurried, you certainly shouldn't feel hurried by the market. I don't think it's ever wise to rush into a buying a house, though appreciate that things like babies can impose awkward deadlines.

Keef Wrote: ------------------------------------------------------- > Maybe when they say "cash buyers" they mean people > going through schemes like keyworker schemes. > We're in the process of doing so, and although > we're obviously getting a mortgage, it's all taken > care of, and we have funds available that put us > in a good position to act much like a cash buyer. > > As an aside, I'm new to it all, and really can't > believe the bullshit that goes on! i hope you aren't rushing into the market just yet... if I were you I'd be treading very carefully at the moment, there could be a lot of fallout from the banking crisis. Prices could be significantly lower in only a month or two. there's certainly no need to fall for the usual estate agents' trick of making you feel hurried.

local estate agent Wrote: ------------------------------------------------------- > If there are cash buyers out there, where are > they?? aren't a large proportion of your recent registrations cash buyers rather than mortgage-backed buyers?

talk of market recovery is probably premature after the collape of lehmans, even if there was an upturn in september. this article from the evening standard suggests that the banking crisis has well and truly obliterated any hope of recovery: http://www.thisislondon.co.uk/standard/article-23571108-details/Property+sales+down+by+75+per+cent+with+50+viewings+to+get+a+deal+get+a+sale/article.do Given that prices lurched down in the months after collapse of northern rock, and then lurched down again more dramatically this spring after Bear Stearns collapsed, it seems fair to assume we're now in for an even bigger lurch downwards over the next 6 months.

Jeremy Wrote: ------------------------------------------------------- > Sounds like bullsh!t to me. there might be a bit of vested-interest spin exaggerating the facts, but there is certainly a trend towards cash buying, if ony because NOBODY is buying with a mortgage at the moment. i think it's unlikely that cash buyers can stop the crash, but they might well give sellers a window of opportunity. see article in the Times: http://www.timesonline.co.uk/tol/money/property_and_mortgages/article4916890.ece The average cash buyer is probably a bit of a predator, so they are probably driving hard bargains, but it still represents a chance for sellers to get out of the market if they want to.

for sellers there is a little bit of good news. I'm hearing that there are quite a few cash buyers around at the moment who don't want to risk putting their money in banks or the stockmarket and hence looking to buy property. Though they expect house prices to keep falling for a while, the money is perhaps safer in bricks and mortar than elsewhere in the current climate. This means that the next month or two are actually a much better time for sellers as there are buyers around. Could be a short-lived trend, as there are only so many cash buyers in the world and the government has been quick to shore up the banks by nationalizing the.

indiepanda Wrote: > it's not just first time buyers - when I next buy > it will be my third property. I just happened to > sell my last one before moving to London last > year, and now I am out of the market it seems a > little daft to rush back in when I can get a > better deal by waiting. My rent is lower than I'd > spend on mortgage (my flat is ok but I want a > small house, and renting seems cheaper than > repayment mortgage anyway) so I can save while > seeing the kind of place I'd like become more > affordable. if it's a small house you're after, you've come to the right place. ED is full of them. There are even lots of peculiar little "half houses", which are the size of a flat and share a front door with the neighbour but give you a whole freehold house and garden. I think they make a good stepping stone from flat to house, but watch out for ambitious vendors pricing them on a par with whole houses.

Andyng Wrote: ------------------------------------------------------- > okay you buy a ?300k flat put 10%down do you think > the property will drop > 10% in a year? yes quite possibly. UK house prices are already down more than 10% in a year. Judging by what's happened in other countries currently experiencing a house price crash (e.g. denmark and USA), they could well carry on falling next year at the same rate. > > So everyone waits but for how long ,interest rates > may drop inn a few years > okay those same people who have been waiting all > begin to buy,this causes a huge > demand upping prices.In the meantime rents go up after the crash in the early 90s, there wasn't a sudden demand surge. The market flatlined for a few years and then started rising slowly. > You cannot wait forever. a truism. Waiting a couple of years is probably enough to get the bulk of the price falls under your belt. Any further falls can be taken on the chin as the market is probably going to find its feet again by 2012. Don't quote me on that though.

indiepanda Wrote: ------------------------------------------------------- > I could afford to buy here, though not yet > the kind of place I'd really like to own, but I've > no intention of gambling with my deposit and > potentially seeing my equity vanish when I could > wait a while and buy somewhere nicer later on. that's the predicament facing all first-time buyers at the moment. If house prices carry on falling 1-2% a month, it doesn't take very long for a hard-earned deposit to evaporate and the spectre of negative equity to rear its head. Although many people say negative equity doesn't matter if you can afford the repayments, in fact it causes problems when mortgage rates re-set after discounted or fixed terms expire. The owner is then unable to re-mortgage and forced to accept a painfully high variable rate deal from their current provider.

EDOldie Wrote: ------------------------------------------------------- > First law of economics, supply and demand. This is > a very small country with a very large population > with most of the serious economic activity > concentrated in London and the South East. very similar to japan. It didn't stop house prices there from falling continuously for 18 years. As indiepanda points out, supply and demand also dictates the level of rent, which hasn't risen in parallel with house prices - rents have merely kept pace with wage inflation. We currently have an excess of supply of houses for sale and an shortfall in demand. In economic terms, that tells us that the true equilibrium price for houses is below current asking or completion prices, which will therefore continue to fall until they reach or pass equilibrium. Equilibrium is likely to be near the point where rental yields comfortably exceed mortgage rates. > All I am saying is that > this situation could, and is more likely in the UK > than almost more than anywhere else in the world > at the moment, to change surprisingly quickly. that's not quite correct. The UK's particular balance of supply and demand does not make the housing market move more quickly or with more volatility. It merely sets the level of the floor under house price falls. Limited supply will stop prices falling as much as they would if supply was much looser. As for how restricted supply truly is, again you need to look at rents which reflect demand for accommodation without the distorting infuence of the credit bubble. > It may not be the bottom of the market yet, but > the fact is that we enjoy some excellent housing > stock in ED which in recent years has been > improved and restored and, with all the other > amenity values of the area, schools, transport > restaurants etc etc, should be in high demand when > some confidence returns. Even if the septics (not > sceptics) bugger up the banking system. As for > those bankers, greedy bastards, eh? well the best housing stock in this part of london is in Dulwich village. ED is mostly small workers houses packed closely together - the victorian equivalent of a housing estate, though more desirable after a century thanks to the period charm we now all want. I wouldn't say the housing stock here is especially good (and don't forget the area's widespread subsidence problems), but it's nice that there is a large and almost wholly intact victorian neighbourhood. As for amenities, Lordship Lane is great, but apart from LL what is there to recommend ED apart from the peace and quiet? Transport is definitely a weak point with no tube access. At the moment, canny buyers are more likely to be shopping along the route of the southeast london line extension, particularly in the areas around honor oak, forest hill and crystal palace. I've no doubt the new service will mitigate house price falls in those areas. It may even help ED a little, but not as much. As for how ED weathers the coming storm, I think we just have to wait and see. In the last crash Dulwich village pulled through well and ED didn't fall as far as peckham or lewisham, but it did suffer. This time round it's a nicer area, which may protect it. On the other hand, the economic crisis could hit london's commuter neighbourhoods especially hard as the city is going to bear the brunt of the downturn.

EDOldie Wrote: ------------------------------------------------------- > Just to quote benmorg "the thrust of your argument > as you seem to be saying there is so much > uncertainty that a rise in prices is as likely as > a fall, i.e. the market could swing either way > with equal probability." er, yeah, thats what I > think. The market could be complete crap, could be > a blinder. Hence saying extreme caution is how you > go ahead. But, and it really does kill me to say > this as I can't stand the centralised bigotry of > the bloke, Gordon Brown is right about one thing > (and one thing only) the UK property market is > very, very different from the US property market > and there lies our salvation (hallelujah). We have > a very small supply, which will choke very quickly > as the number of building starts stops, so to > speak, and the number of people prepared to sell > drys up. In essence, the market could turn very > quickly. But you might be right, the fact is no > one know what will happen next. I think you're wrong to see the UK and US markets as unrelated. In reality both are part of the same economic system, and our housing downturn was triggered by the one in the US. The same applies to Denmark (where house prices peaked in 2006 and still falling), spain, ireland, new zealand, australia, france... supply of properties in east dulwicch is certainly not limited - there are about twice as many properties on sale now as there were a year ago. The old argument that limited supply of housing in the UK underpins prices is spurious. If it were true, rents would have risen to giddy heights in parallel with house prices. The truth is that there is a house price bubble, driven by low interest rates and lax lending. that bubble is now bursting. As for a quick rebound.. I will just remind readers what happened when japan experienced a banking crisis in the early 90s similar to that now unfolding in the US. House prices went into an 18 year decline that continues to this day. There has been no rebound! This is one of the reasons the current banking crisis is so alarming.

As the banking crisis seems to be going from bad to worse, I would strongly caution anyone against completing on a house purchase in the next few days. At least wait until end of Monday to make sure the evening standard's apocalyptic prediction does not come true: http://www.thisislondon.co.uk/standard/article-23560539-details/Stand+by+for+Black+Monday/article.do it would be a catastrophe if the US can't sort this mess out by monday and somehow prop up the credit the markets. It has now got to the point where none of our banks are safe, let alone the housing market.

EDOldie Wrote: ------------------------------------------------------- > Probably said this before, but the property market > is incredibly unpredictable. Just when you think > you know where it's going it turns round and bites > you in the arse. Having already experienced, the > two worst property recessions since the war, the > only advice can be extreme caution. Either buying > or selling. Now is not the time to make a hasty > decision, but you can still make the right one. So > this could actually be a very good time to buy, or > sell. > > benmorg, what are you taking about over 30's being > tired of London??? Thats a bit early. > > "Why, Sir, you find no man, at all intellectual, > who is willing to leave London. No, Sir, when a > man is tired of London, he is tired of life; for > there is in London all that life can afford." > ? Samuel Johnson i love the samuel johnson quote - one of my favourites. Also like the one about a man's best moments in life being spent lying in bed in the morning. Perhaps shouldn't have said that oldies quit london because they'e "tired" of it - the full explanation is usually that growing families and need for better schools and bigger houses force people out. I agree there is a lot of uncertainty in the housing market, but I don't agree with the thrust of your argument as you seem to be saying there is so much uncertainty that a rise in prices is as likely as a fall, i.e. the market could swing either way with equal probability. In fact the risks are far greater on the downside. Not just in the UK - the housing bubble was almost global, and the bursting will be too. Unfortunately for us, we happen to be in one of the countries most exposed.

east dulwich has got enough gyms already. What we need is a cinema. And a decent bookshop please

the surveyor saw no evidence of bat roosts, but I've definitely seen them flying at dusk. It would be easy enough for residents to commission a bat survey from english nature or some other independent body if they wanted to throw a spanner in the works.

they do nest in trees (especially in old trees of "poor condition", which are full of holes and hollows). However, it might be too late now, according to the website below: "Once planning permission has been granted it is unlikely that the presence of bats will stop a development in progress. However if there are good reasons to believe bats are being affected by a development then English Nature should be notified, as there may be grounds for delaying or modifying the project, as the necessary licences and permissions will still have to be obtained. In extreme cases where roost destruction is imminent and if there is tangible evidence that bats are being harmed, the police should be called. Theoretically, even if a council and developer have gone through the above procedures, it may be possible to launch a judicial review to determine whether or not a DEFRA licence has met all three of the necessary conditions. Similarly if councils have failed to take sufficient account of protected species in determining applications there may be grounds for an appeal or complaint to the local government ombudsman." http://www.surreybats.org.uk/planning.htm

interesting. The report notes that 'no habitat or ecological study has been provided by the council'. There are definitely bats living in the greenery around abbotswood road - I've seen them flying through my garden. I don't know if the species if protected, but if it is and there are nesting sites in the trees, then this planning application should not have been approved. I can provide contact details for a biologist with experience in such matters should anyone wish to PM me. She has dealt with a very similar issue in North London, where a developer wanted to build on a site occupied by a protected bat species.

local estate agent Wrote: ------------------------------------------------------- > Yeah, the trees are coming down.... do you know where the gym driveway will be on that picture? My guess is that it would in the large gap between the houses in Talbot Road, where the white rectangle is currently parked.

the thing to keep an eye on at the moment is mortgage rates. They were coming down, but now they are all over the place due to the collapse of lehman and total panic among lenders. Already major banks have started hiking rates: http://www.thisislondon.co.uk/standard/article-23560251-details/Double+blow+on+mortgages/article.do so what next? If the US doesn't somehow manage to sweep all toxic debt in the banking system under an enormous rug, then mortgage rates are going to climb. (In the unlikely event that the US bailout collapses, they will climb very steeply, but thatwould be the least of our worries..) Meanwhile, the Bank of England will probably start cutting base rates sooner than had been planned. If the US bailout is completely successful and inflation peaks soon, then we'll probably see mortgage rates falling and dropping a lot in the new year. However, it all hangs on the success of Paulson's bailout. My opinion is that the bailout will go ahead, but with a load of conditions added by Congress, and then will start to unravel when it turns out that the dodgy assets paulson want to buy off banks are impossible to value. What that would mean for mortgage rates is very hard to judge at the moment. There is huge uncertainty, and that's part of the reason markets (including the housing market) are freezing up.

so they must be planning to cut down the trees in the thin strip of land along the railway line. Any flats there are going to uncomforably close to passing trains, which won't help with selling. And presumably not outdoor space besides balconies overlooking either the train line or people's back gardens. Not a great plan as residents will be able to object to intrusion of privacy, and the street will lose the screen of trees blocking train noise. If the developers are using the gym as a stepping stone to building flats, I think they could come badly unstuck.