House prices in my street
With ever more stories about global financial meltdown hitting the papers, property buyers and sellers in the UK can be forgiven for getting a little nervous. Do you sell? Do you buy? Will you even get a mortgage? But the one question you’ll be asking is ‘what about house prices in my street‘: the rest is irrelevant really.
One thing is for sure - this isn’t good news, and you’d be very hard pressed to find any financial commentator who will deny there is a fall in the housing market currently taking place. The bulls have gone out to pasture while the bears are growling about falls of at least 5 per cent this year. There’s an interesting piece ‘Will house prices fall?’ in the Daily Telegraph in which sentiment is remarkably consistent.
But … and it’s a big but. There is no such thing as the UK housing market. Those of us who’ve been buying and selling UK property over the last few years recognise all too clearly that this is an agglomeration of dozens, hundreds, even thousands of micro property markets. Suddenly, in early 2008, if the experts are to be believed, the market turned and now UK property prices will fall (across the board) by between 5 and 10% during 2008. Further, two-bedroomed flats are now in glut across the UK ‘you can’t give away two bedroom flats’ according to one Peckham estate agent I spoke to last week.
But here’s the thing. Many of these micro markets stalled at least three years back. Many have been falling for a couple of years. Others have been steadily rising. Some, to add confusion to this rich mix, have been rising while they SHOULD by any fundamental analysis have been falling. Step forward two-bedroom ‘luxury developments in Thameside locations’ (Woolwich andSilvertown in other words). Investors have piled in, artificially maintaining the premium prices of apartments in resolutely non premium location. These will fall by … well it’s your guess, but I wouldn’t take a spread bet on less than 20%. Meanwhile, a nice Victorian conversion two-bedder in East Dulwich will hold its price pretty much - because they have fundamental, historic value and there aren’t a hundred of them in a block. They will fall for sure … but not catastrophically.
So we return. How much are house prices in my street going to suffer? Get the REAL information not the apocrypha. Much of this is historic of course so you’re finding out what HAS happened, but it’s still useful. We’re talking Land Registry figures and there are any number of websites now offering this service, including thisishouseprices.co.uk. But remember this is a broad brush. You can’t simply bang in ‘4-bed house in BR5′ and get a homogeneous answer. Some houses are nicer, some have been vandalised by owners who think Tudor cladding looks sweet on a fifties semi. Talk to estate agents. Use your judgement. And remember … a house is worth what somebody will pay for it, no more no less.
