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House prices falling due to ‘fear factor’
"The fear factor" is driving down property prices in Dorset with house values set to fall by five per cent by the end of this year.
That's the view of David Slade, senior partner with Slades estate agents, after figures from the Nationwide Building Society showed that house prices nationally have dropped for the fifth month in a row. Mr Slade said: "We are busy with viewings but instructions are below normal and the volume of sales is considerably down.
"Prices have fallen but asking prices haven't which is creating a frozen market. I anticipate a drop of five per cent in property values here over the next six to 12 months.
"But the price adjustment is positive for first-time buyers. The only people who are suffering are those who bought in the last two years who could find themselves in negative equity.
"The fear factor is definitely affecting the market; there is a shortage of applicants and selling times are taking longer.
"But I don't think there is going to be a property crash. These cycles normally last about a year and this one started last summer following the introduction of home information packs."
Nationwide statistics show that annual house price growth fell to its lowest level for 12 years during March as prices dropped for the fifth successive month.
The average value of a home inched ahead by just 1.1 per cent in the year to the end of March, its lowest rate since March 1996.
Nationwide's chief economist Fionnuala Earley said: "The outlook for UK house prices is clearly more downbeat than at the time of our November forecast.
"Some of the downside risks we identified then have become a reality - most notably the continued turmoil in the financial markets."
The group now expects house prices to end the year up to four per cent lower than they started it.
The British Bankers'Association has revealed that the number of mortgages approved during February fell by a third, compared to the same month in 2007.
7:00pm Friday 28th March 2008
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CommentPosted by: Trifecta, Southbourne on 7:08pm Fri 28 Mar 08
Sorry to be ignorant but what does this mean?
""Prices have fallen but asking prices haven't"
If he means that property is over valued he needs to have a think about who overvalues houses and flats in order to obtain the business.
Sorry to be ignorant but what does this mean?
""Prices have fallen but asking prices haven't"
If he means that property is over valued he needs to have a think about who overvalues houses and flats in order to obtain the business.
Posted by: godzilla, hamworthy on 7:21pm Fri 28 Mar 08
House Prices are frozen because people cannot borrow enough to buy a rabbit hitch in this area, it had to happen sometime
House Prices are frozen because people cannot borrow enough to buy a rabbit hitch in this area, it had to happen sometime
Posted by: godzilla, hamworthy on 7:21pm Fri 28 Mar 08
oops sorry rabbit hutch
Posted by: Carl Barron, Dorset on 10:39pm Fri 28 Mar 08
Well, I can't say prices are falling in BH23 Highcliffe. A young chap not much older than 35 came into Austin & Wyatt's looking at a £500,000 Bungalow, he said has it a garage the Sales lady said no I'm afraid not , so off he went to look at another at around the same price.
The point I'm trying to make is, that there is money out there for properties in upper class areas.
You might like to try this web-page for property prices as it has lots of different search facilities available. Good luck.
[bold]Copy paste[/bold] link below into browser:
http://dorsetvisualg
uide.co.uk/homes.htm
Well, I can't say prices are falling in BH23 Highcliffe. A young chap not much older than 35 came into Austin & Wyatt's looking at a £500,000 Bungalow, he said has it a garage the Sales lady said no I'm afraid not , so off he went to look at another at around the same price.
The point I'm trying to make is, that there is money out there for properties in upper class areas.
You might like to try this web-page for property prices as it has lots of different search facilities available. Good luck.
Copy paste link below into browser:
http://dorsetvisualg
uide.co.uk/homes.htm
Posted by: paul, poole on 11:51pm Fri 28 Mar 08
I'm surprised...usually it's the Halifax who starts the wind up first.....
I'm surprised...usually it's the Halifax who starts the wind up first.....
Posted by: HAL101, Bournemouth on 9:42am Sat 29 Mar 08
Trifecta, Southbourne on 7:08pm Fri 28 Mar 08
[quote]what does this mean?
""Prices have fallen but asking prices haven't"[/quote]
David Slade meant that people ask a price that is no longer accurate as the price that properties actually sell for has fallen.
Developers usually ask a price that is too high in the expectation that as prices rise due to inflation they will, eventually, get what they ask for. Ironically this in itself is a major contribution to the inflation process.
The government's prediction is that prices will level off, although there will be a bit of local movement, and then remain stable.
Trifecta, Southbourne on 7:08pm Fri 28 Mar 08
what does this mean?
""Prices have fallen but asking prices haven't"
David Slade meant that people ask a price that is no longer accurate as the price that properties actually sell for has fallen.
Developers usually ask a price that is too high in the expectation that as prices rise due to inflation they will, eventually, get what they ask for. Ironically this in itself is a major contribution to the inflation process.
The government's prediction is that prices will level off, although there will be a bit of local movement, and then remain stable.
Posted by: Trifecta, Southbourne on 3:14pm Sat 29 Mar 08
Hi Hal, that was my point.
"David Slade meant that people ask a price that is no longer accurate as the price that properties actually sell for has fallen."
It is he, and his ilk, who are setting these prices. Estate agents are fairly generic (there is one very well known name that is an exception. I swear that they are purely a listing agency)so in order to win the instruction they value the property as high as they can get away with.
In my recent experience at least.
Hi Hal, that was my point.
"David Slade meant that people ask a price that is no longer accurate as the price that properties actually sell for has fallen."
It is he, and his ilk, who are setting these prices. Estate agents are fairly generic (there is one very well known name that is an exception. I swear that they are purely a listing agency)so in order to win the instruction they value the property as high as they can get away with.
In my recent experience at least.
Posted by: HAL101, Bournemouth on 5:47pm Sat 29 Mar 08
Posted by: Trifecta, Southbourne on 3:14pm today
Yes I do agree with you that the agents do set the prices, which have resulted in the serious inflation of property prices.
But in order to stay in business they have had to do so. They must out do the competition in price valuations.
It is an ugly situation but it is difficult to see how it can be avoided other than let the prices rise to a point where people cannot, or will not, pay. It looks as though that point has been reached.
The property owners do not benefit as they must pay a high price when they move. In fact the higher tax makes it increasingly expensive to move. Renting does have it's advantages if you are mobile.
The first time buyers find it increasingly difficult to buy a house, yes, but I was very surprised to see how much cheaper property (especially flats) was around when I surfed Rightmove. Some are in very nice large old houses. Take a look and see. So I don't see that the first time buyers are at such a disadvantage. There is a very wide range of property prices on the market. Perhaps the first timers need to lower their expectations of what they can realistically hope for in their first home.
Posted by: Trifecta, Southbourne on 3:14pm today
Yes I do agree with you that the agents do set the prices, which have resulted in the serious inflation of property prices.
But in order to stay in business they have had to do so. They must out do the competition in price valuations.
It is an ugly situation but it is difficult to see how it can be avoided other than let the prices rise to a point where people cannot, or will not, pay. It looks as though that point has been reached.
The property owners do not benefit as they must pay a high price when they move. In fact the higher tax makes it increasingly expensive to move. Renting does have it's advantages if you are mobile.
The first time buyers find it increasingly difficult to buy a house, yes, but I was very surprised to see how much cheaper property (especially flats) was around when I surfed Rightmove. Some are in very nice large old houses. Take a look and see. So I don't see that the first time buyers are at such a disadvantage. There is a very wide range of property prices on the market. Perhaps the first timers need to lower their expectations of what they can realistically hope for in their first home.
Posted by: Mike Pickering, Bournemouth on 5:43am Sun 30 Mar 08
Just baffles me how anyone can afford even an average house on Canford Heath, for instance.
245,000 pounds for a small 3 bed house, a below average size family of 2 kids mum and dad, the mortgage set at 5 times annual pay, that's nearly 50,000 pounds a year you have to show to get the mortgage...
Has the whole town now become populated only by coke dealers, lawyers, doctors and stockbrokers then ?
Where do all the people who do all the other jobs - office work, shops, bus drivers etc live then ?
This whole house price debarcle is only just starting to come crashing down around everyone's ears.
Anyone who pay that much to buy so little is either mad, stupid or greedy, and we've only seen the tip of the iceberg. They did this to us all back in 89 remember ?
Just baffles me how anyone can afford even an average house on Canford Heath, for instance.
245,000 pounds for a small 3 bed house, a below average size family of 2 kids mum and dad, the mortgage set at 5 times annual pay, that's nearly 50,000 pounds a year you have to show to get the mortgage...
Has the whole town now become populated only by coke dealers, lawyers, doctors and stockbrokers then ?
Where do all the people who do all the other jobs - office work, shops, bus drivers etc live then ?
This whole house price debarcle is only just starting to come crashing down around everyone's ears.
Anyone who pay that much to buy so little is either mad, stupid or greedy, and we've only seen the tip of the iceberg. They did this to us all back in 89 remember ?
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