will Realestate Market crash ?

What do you think about buying a house in UK in this time ?
I heard that the houses went down in the past ..
I am monitoring some houses in Reston VA USA .. I see some slowdown in prices.
What do you thinK ? Do you have an analysis on UK ?

Regards,

Date                Sale Price
01/11/2005   330,000 
01/12/2005   326,900 
01/25/2005   318,600 
01/31/2005   329,500 
02/07/2005   310,000 
02/15/2005   285,500 
03/01/2005   332,900 
03/01/2005   335,000 
03/16/2005   332,500 
04/15/2005   315,260 
04/26/2005   348,500 
04/27/2005   345,000 
05/03/2005   345,500 
05/19/2005   354,000 
06/02/2005   350,000 
06/23/2005   356,000 
07/18/2005   355,000 
07/28/2005   356,200 
08/08/2005   366,000 
08/23/2005   361,000 
08/30/2005   365,000 
09/26/2005   355,000 
09/26/2005   355,000 
09/27/2005   362,900 
10/03/2005   358,000 
11/02/2005   350,000 
11/28/2005   350,000 
12/12/2005   339,000 

Do you plan to buy a house in London? It will always be an expensive place to live, regardless of interest rates and inflation. I doubt that house prices will ever go down there... But who knows?

In the US, people have invested in the real estate in recent years due mainly to low interest rates. However, salaries haven't quite kept up with the inflation, increasing property taxes, rising energy costs and overall over-valued house prices. Now the market is slowing down simply because less and less people can qualify for expensive mortgages. Is it the same trend in the UK?

Hiya,

The government and the Bank Of England are hoping there ISNT a crash, but more of a 'gradual' reduction in prices. Recent indications show however that even with last months Interest Rates rise of a 0.25% the housing market hasn't slowed but in fact average prices were up again.

Myoracle - you're 'generalisation' of buying a house in the UK is too vague. There have been increases and decreases in property values. I think you need to find a site which shows historical prices for the UK as a whole and then for specific areas. For instance, where I bought my apartment in Sept 02 for £112 grand, the same property in 1998 was 70K - it's now worth around £146K ( 2BR, purpose built around 18 years old) but this time last year it was worth around 138K after for a long while properties were selling for 143K - so I'd 'lost' 5 grand over a period of a few months. Over the last 3 months it's climbed to the 146K mark and one dreamer asking £160K for his ! (it'll never sell at that price!)

We all of course hope there isnt a crash in house prices like in 1989 & we hope a gradual slowdown/reversal doesnt put us into negative equity - but the current sitiuation is ludicrous. The way these prices are fuelled are due to people 'moving up the ladder' which accounts for around 70-75% of the market - the other margin being made up of a dwindling number of 1st time buyers.

nena - salaries here are no where near close to matching house price levels and it's pretty much the same in vast areas of the UK. In the US it's less so because of it's size and variation, it's still possible to find quite a large number of 'relatively' cheap properties. I'm currently eyeing up a few years old 4bd 2 BR house in florida (near disney) for $275000 and a 3bd 1br condo for 188,000 USD as well as other similar properties in various other states. We've also had crazy price hikes for taxes, energy costs etc which bite more than the same in the US becuase UK costs of living are significantly higher.

Currently - London is the most expensive home property market in the world. It's currently the 5th most expensive city in the world (for a couple years it's been 2nd) so value for money isn't so great here compared to the US, NYC and SF home property markets are the hottest with Miami playing catchup and even then NYC comes in at something like 7th place - Moscow is the 2nd hottest home property market.

Lets see what happens over the next few years...

Cheers ! Dennis! West bloomin expensive London UK!!

Hi Dennis and thanks..
please see below the last transactions in the area of Herndon,VA. I did moved to this area on jan-2003 and did try to buy a Condo for 300K or less , I was  not able to find any. So I moved to Atlanta and get a signle family house for $265K
with 5 rooms amd 3/4 Acreas.

reference:
ANGELINE DR  HERNDON VA 20171 for Condos

Now I see  condos for $305, $295.  I am monitoring about 100 Condos in this area and I think the marke in this area is over priced

Try to read these numbers and tell me what do you think ? All these condos are built alsmot identical.
Personly I dont see any great tax advantages to owning in UK. It is much cheaper to rent a house in the UK than it is to own that same house. ( Rent £700 vs  owning £2,000)

http://icare.fairfaxcounty.gov/Search/GenericSearch.aspx?mode=ADDRESS
 
read this  too
http://patrick.net/housing/crash.html

08/25/2006       $305,000
08/22/2006       $305,000
08/01/2006      $295,000
07/31/2006      $329,000
06/27/2006      $329,000
05/22/2006      $327,500
03/28/2006       $347,000
03/02/2006       $345,000
11/02/2005       $350,000

They've been talking about a *housing crash* since I arrived here in 1999! It's not going to happen.  And worst of all - by the time my step kids want to buy a house - there is no way in hell they would ever be able to afford even a downpayment.

I say bring on the capital gains tax on primary residence - that'll slow things down! 

Check out the message board at:

http://www.housepricecrash.co.uk/

Personally, I think it will deflate. Whether quickly or slowly, I don't know. The way things are right now is not sustainable. I mean, if the average home price in the UK is 180k and the average salary is 23k, the math just does not work out. Two incomes would be required to obtain a mortgage, and even with two incomes, they would be well extended. If they have an interest only mortgage or a variable rate mortgage, and interest rates are raised, there is a large amount of people who are so over leveraged that they wouldn't be able to handle the fluctuations. It won't take much for the dam to break for many of these families.

I foresee many foreclosures in a few years, so I think DH and I will just rent until conditions are more favorable to buying. If the prices just keep going up, then fine we will inherit 1/2 of his mum's home in (greater) Manchester- bought for £8k in 1976. Now it is "worth" £170k. So... in 1976, regular working class people could purchase a 3 bed semi on one (blue collar) income. Now it takes two professional incomes. It is outrageous. I found a calculator that said Mum's home should cost £50k in today's currency.