UK House prices: News & Views

[tallim]

Well, our tenancy is up in a few months, so we thought we'd have a quick check of what's for sale in our area of the North West. Before we looked we decided that we'd go check what kind of mortgages were being offered, so booked in to see the Nationwide this lunchtime. We look like a decent credit risk on paper; double income, no kids, no debt, decent deposit, etc... I wasn't prepared to be offered 5 times joint salary though, I thought those days were gone.

 

My advice is don't bank with Nationwide, though they're probably not alone on this, so maybe the advice should be don't bank in the UK

Just to finish this anecdote off, we chose another rental, good value to be had round here at the moment if you're mid-market or above. I estimate at today's selling prices (back to 2004ish round here) the landlord is getting about 4.2% gross yield, 3.3% after they've paid the service charge (it's a large apartment in big well-maintained grounds, so the charge is quite hefty) and <3% after fees and a small maintenance budget.

 

While I could beat that cost of funding in the short-term, making it technically cheaper to buy than rent, it's marginal and I'd not get compensated for taking on the risk.

 

The place is owned outright and has been a rental for a while, so I hope I'm minimising the risks to security of tenure.

[TrueNorth]

Have noticed locally that vacant high-end properties that haven't sold in +6 months are finally being offered for rent. Vendors clearly wise in choosing to get tenants and having the place heated this winter, to heating them themselves. I would happily rent one but they tend to be thermally disastrous and completely wasteful. It's a shame, though, because these are some decent properties.

[John Doe]

Just to finish this anecdote off, we chose another rental, good value to be had round here at the moment if you're mid-market or above. I estimate at today's selling prices (back to 2004ish round here) the landlord is getting about 4.2% gross yield, 3.3% after they've paid the service charge (it's a large apartment in big well-maintained grounds, so the charge is quite hefty) and <3% after fees and a small maintenance budget.

 

While I could beat that cost of funding in the short-term, making it technically cheaper to buy than rent, it's marginal and I'd not get compensated for taking on the risk.

 

The place is owned outright and has been a rental for a while, so I hope I'm minimising the risks to security of tenure.

Sounds a good move.

 

I was speaking with an EA from our area today (discussing a possible extension etc).

 

He said the nice family houses by us rented for ~3% of their sale price.

 

Meanwhile, back in the west end, the flats rent for about 5 or 6%

[Van]

One should take a pinch of salt when working out rental yields. Lots of properties are rented because they have been unrealistically priced.

Great example was my last rental flat - on the market July 2010 @ £340k. We were paying £1128/month, so the asking price was 300 times the monthly rental.

 

Fast forward 16 months later, and it is still on the market. Price has been down, down, up and back down, and currently sits at £315k.

 

Point is that a lot of places are on for kite-flying prices because the landlord can afford to sit on them and collect the monthly rent. Lots of prospective buyers will only buy a real bargain - you can say the same for lots of prospective sellers.

 

Here is the flat: http://www.zoopla.co.uk/for-sale/details/11685931?search_identifier=0ed623b0901ddb41b43052ff6d5c293d

[tallim]

Sounds a good move.

 

I was speaking with an EA from our area today (discussing a possible extension etc).

 

He said the nice family houses by us rented for ~3% of their sale price.

 

Meanwhile, back in the west end, the flats rent for about 5 or 6%

 

I hope so, I have no doubt in my mind that I would be making a different decision if my circumstances were not as they are. I think personally I can only take advantage of things like this because I have few responsibilities and an understanding wife who is willing to override her nesting instinct.

 

Add dependants, or illness, or a less flexible job, etc... and I would pay a significant premium to have a more permanent home and greater security of tenure over a standard Assured Shorthold Tenancy. Maybe the market for decent family homes has always been like this and will continue while the only choices are AST or ownership?

[drbubb]

I was speaking with an EA from our area today (discussing a possible extension etc).

He said the nice family houses by us rented for ~3% of their sale price.

Meanwhile, back in the west end, the flats rent for about 5 or 6%

I see those sort of numbers frequently,

Yet most people will often say: "Houses are a better investment than flats."

 

Is it because they think the underlying land value is going up?

[John Doe]

I see those sort of numbers frequently,

Yet most people will often say: "Houses are a better investment than flats."

 

Is it because they think the underlying land value is going up?

 

Possibly.

Maybe also the ability to extend (or even rebuild as we have essentially done).

 

Also, I think flats in England are leasehold (also have service charges a lot of the time).

 

As for rentals, the king and queen of BTL (the Wilsons , the ex maths teachers) always suggested small houses (2 or 3 bed semi/terrace AFAIR) but in the right location, were the best for yield etc.

 

You can see that here also. Small places like this up the road, but still in the good catchment areas etc, would give a yeild closer to 5%, where the big detached 5 bed places would give ~3%.

[BlackPepper]

UK is generally just a bleak over rated dump no matter how you look at it

[John Doe]

UK is generally just a bleak over rated dump no matter how you look at it

[BlackPepper]

it is without shame a total dump and I can say spending some time there......

[LC1]

it is without shame a total dump and I can say spending some time there......

You're a half-full type of guy aren't you?!

[BlackPepper]

You're a half-full type of guy aren't you?!

speculation is the mother of all stuff ups

[John Doe]

Just to cheer everyone up....

 

British house prices rose by 0.6 pecent on a seasonally adjusted basis in August, the biggest rise since March, government data showed on Tuesday.

 

The Department of Communities and Local Government said house prices were 1.3 percent lower than a year earlier, the smallest annual fall since April, and taking the average price of a home to 208,476 pounds.

 

 

http://www.lse.co.uk/FinanceNews.asp?ArticleCode=p1um4oqscc05f9u&ArticleHeadline=UK_house_prices_up_06_pct_mm_in_Aug__DCLG

[TrueNorth]

UK is generally just a bleak over rated dump no matter how you look at it

 

I agree. And the weather is dreadful.

 

My sister told me, "You have to find somewhere with better weather. Life is too short."

 

She's right!

[simonc]

I agree. And the weather is dreadful.

 

My sister told me, "You have to find somewhere with better weather. Life is too short."

 

She's right!

 

Tis true but where to go?

 

Personally I can cope with (and ignore) the weather, I'd even be happy to move back to my homeland of Scotland, if only for the peace and quiet of the glens but Mrs Peter and the Wolf is having none of it.

 

Looks like rural France for us.

 

Sunshine, fertile land and most importantly the

leftist (comparatively) lifestyle

of a republic.

 

Still stacking and hoping.

[John Doe]

Don't worry all, the master plan is starting to work

 

The UK's trade deficit narrowed in August as the export of goods hit a record high, official figures have shown.

 

http://www.bbc.co.uk/news/business-15287582

[warpig]

I completely disagree. There are dumps in every country, where were you in the UK and where is home? When the sun is shining and you look out over the rolling British countryside, there's nowhere else I'd rather be. We have one of the highest standards of living in the world here.

 

it is without shame a total dump and I can say spending some time there......

[John Doe]

I completely disagree. There are dumps in every country, where were you in the UK and where is home? When the sun is shining and you look out over the rolling British countryside, there's nowhere else I'd rather be. We have one of the highest standards of living in the world here.

 

Yep, really depends where you are (and what the weathers like).

 

There are some fantastic places in the UK, (and some dumps).

 

One of my colleagues retired last year and instead of a round the world trip, he went all around the UK.

 

Found some great places, one of which (Bradford on Avon) we visited after he told us about it. Lovely place, canal, river etc with fascinating history to boot.

[BoldAsBrass]

I completely disagree. There are dumps in every country, where were you in the UK and where is home? When the sun is shining and you look out over the rolling British countryside, there's nowhere else I'd rather be. We have one of the highest standards of living in the world here.

 

Yes, I completely disagree too. So many people are negative about this country yet (as has been observed, depending where you live), there really are few places on earth I would rather LIVE.

 

One day I hope to retire either to the South Hams or the North Cornwall coast somewhere around Watergate Bay. A walk along that beach every morning and evening, and a pint of Doom in the bar there watching the sun go down over the Atlantic is, as far as I am concerned, 'as good as it gets'. Bearing in mind you are in a country that is vaguely civilized - it will do for me.

[pondlife]

I completely disagree. There are dumps in every country, where were you in the UK and where is home? When the sun is shining and you look out over the rolling British countryside, there's nowhere else I'd rather be. We have one of the highest standards of living in the world here.

 

I agree with you warpig. I love our countryside and its rich history and its the rain that makes it so green and fertile. I think it was Billy Connelly who said there is no such thing as bad weather - its just you're wearing the wrong clothes.

 

The main problem I have with living in the UK is that it is over populated and we have a political class (and civil service) who are as mendacious and detached from the reality of its people as any in the world. However come the revolution etc etc......

[warpig]

I disagree with this as well (I'm on a roll... )

 

I moved back from Melbourne to England because we missed England. What I did realised is the weather isn't anywhere near as bad as people claim it is. The problem is British people want a raging hot summer every summer and when the MET Office promise us one and we don't get it, everyone in the UK whinges, blame the MET Office for setting false expectations... I'd also say whilst Melbourne is renowned for having four seasons in one day, the Oz weather is boring. It's blisteringly hot all the time, it's dull... I like dramatic seasonal weather, it's nice, the landscape changes and it keeps it interesting. Christmas in Australia is horrible, it just doesn't feel like Christmas. I had a private white sands beach at the bottom of my garden and in the end I never used to go down to it, you take it for granted and you always want what you haven't got... One thing I will say for a hot climate, is New Years Eve is awesome at the peak of summer, I'll miss that...

 

When I got back, I kept a close watch on the weather to see if it was as bad as I remembered and do you know what, we have the best cross section of weather anywhere in the world I've ever been to. Extreme weather in any capacity has it's draw backs. I'm glad we came home.

 

I agree. And the weather is dreadful.

 

My sister told me, "You have to find somewhere with better weather. Life is too short."

 

She's right!

[warpig]

Sounds nice!

 

 

 

Yes, I completely disagree too. So many people are negative about this country yet (as has been observed, depending where you live), there really are few places on earth I would rather LIVE.

 

One day I hope to retire either to the South Hams or the North Cornwall coast somewhere around Watergate Bay. A walk along that beach every morning and evening, and a pint of Doom in the bar there watching the sun go down over the Atlantic is, as far as I am concerned, 'as good as it gets'. Bearing in mind you are in a country that is vaguely civilized - it will do for me.

[warpig]

I couldn't agree more. Also at least we are the top of the food chain in this country, which I couldn't say for OZ.

 

 

 

I agree with you warpig. I love our countryside and its rich history and its the rain that makes it so green and fertile. I think it was Billy Connelly who said there is no such thing as bad weather - its just you're wearing the wrong clothes.

 

The main problem I have with living in the UK is that it is over populated and we have a political class (and civil service) who are as mendacious and detached from the reality of its people as any in the world. However come the revolution etc etc......

[nobla]

I completely disagree. There are dumps in every country, where were you in the UK and where is home? When the sun is shining and you look out over the rolling British countryside, there's nowhere else I'd rather be. We have one of the highest standards of living in the world here.

 

Completely agree with Warpig too. Yes the UK has problems, but so does everywhere else. Calling it a total dump just shows your ignorance IMO . There are some lovely lovely places and people in the UK.

 

I can see how the weather might not be to everyones taste but I really enjoy all the seasons here, especially a crisp autumn morning

[John Doe]

When I got back, I kept a close watch on the weather to see if it was as bad as I remembered and do you know what, we have the best cross section of weather anywhere in the world I've ever been to.

 

I'm guessing you don't live near us (in Glasgow)?