Post: #1

I am looking to buy an apartment in the city where I live and I saw one one sale for £170,000. The thing is, it was last sold last October (2015) for £140,000.

Does anyone who is into real estate have an idea if this means that a bubble is about to burst?

Post: #2

Depends on your sources. Do not look at property search websites or estate agents. Both over value properties and big-up the owners big time and this sense of ego translates into bigger cash demand.

Your best bet is to look at the mortgage lending of that area. If you can obtain mortgage information which can reflect the true value of a property and compare to similar properties (more than a dozen is helpful) then you will be set.

No-one wants to be told they have a lower value than they believe. it is human psychology.


Property bubbles are only created when the debt cannot be funded by the customers (home buyers).

Post: #3

On zoopla, is the previous sale price not reliable? I am not sure if I am to be attracted or scared off by a property which has an asking price so much greater than the recent sale price.

There is a chronic under supply of accommodation in my city and the student population is booming.

Post: #4

Things that raise property prices:
- Location
- Not wanting to move
- Acquaintances of homeowners relocating ("person X got Y amount for their home so we can get Z for ours!")
- Population increases (ones like the European migrant crisis nationally, and migration domestically)
- Amount of available land to build on (subject to local building authorities etc.)

I don't think a bubble is likely to burst soon. Although the factors above are showing a move towards a continued rise in prices, the FCA (Financial Conduct Authority) has really clamped down on the financial real estate sector, giving extra implementations for mortgage advisors to stop another crash happening like the one seen in Ireland in 2008/09.

Post: #5

I'm just wondering if I should go anywhere near a property that purports to have increased in value by 20% in 2.5 months.

Post: #6

(01-07-2016 12:49 PM)N°6 Wrote:  On zoopla, is the previous sale price not reliable? I am not sure if I am to be attracted or scared off by a property which has an asking price so much greater than the recent sale price.

It could be where renovation and/or development work has taken place within those 2.5 months.

My dad in the past has been a bit of a DIY enthusiast, and over the course of a few years has gained a large increase on the value of some of the houses we've lived in. Although that was over a few years, not a couple of months. But just renovating the garden can add something like £5k to the value of a house, and a conservatory another £10k.

It might be where the buyers have called in a renovation team, redone parts of the property, and are trying to make profit from it.

Post: #7

Just wait a few months and see if Corbyn gets elected in. I'd be you'll seeNo a rush to exit London property in a heart beat!

I love England, but home buying is a mother f*cking joke here. Prices are a scam goosed by politicians to bring in more council tax revenue.

Nothing would make me happier than to see these bubbles pop and strangle district councils for tax revenue. Government really has become the problem.

Post: #8

In both the USA, UK and EU I would keep my powder dry for a while especially with the Chinese stock market new circuit breakers kicking in two days in a row and shutting down their markets! Could you imagine the DOW, S&P (NYSE) and NASDAQ markets shutting down for an entire days trading???

http://thesovereigninvestor.com/exclusiv...e-dollars/

2016 … “The End of the Dollar’s Reign (Noted Economist Proclaim the Unthinkable)
BY JL YASTINE January 4, 2016

And now, in a new controversial video, Davidson shows irrefutable evidence for this collapse (he uses over 20 unquestionable charts to prove his point).

“I know that everywhere you turn things look pretty good,” Davidson goes says in the video, “The market is near all-time highs, the dollar is strong and real estate is booming again. But remember, the exact same scenario played out in 1999 and 2007. The economy is unraveling right now, and fast. Very fast.”

Davidson warns that a 50% stock market collapse is looming, that “real estate will plummet by 40%, savings accounts will lose 30% and unemployment will triple.” (To see Davidson’s research behind these predictions, click here.)

And although our future may seem bleak, as Davidson says, “There is no need to fall victim to the future. If you are on the right side of what’s ahead, you can seize opportunities that come along once, maybe twice, in a lifetime.”

The Sovereign Investor grew out of the Sovereign Society - basically the original Global Nomad Capitalists - focused on ultra high growth markets with rapidly expanding middle class and investment opportunities much greater that in the stagnating G8 - so not a bunch of doom and gloomers. These are not the only folks pointing to a severe 2016 market correction...

http://mythfighter.com/2016/01/02/the-mo...-internet/

In every one of his blog articles RMM includes his recession clock chart... not looking good...

His latest CRISPER designer human articles are thought provoking as well... two women scientists collaborate on perfect designer babies and a way to cure HIV in human cells - they are likely to be the new feminist and LGBTQ/Metrosexuals heroines...

Post: #9

(01-07-2016 12:49 PM)N°6 Wrote:  On zoopla, is the previous sale price not reliable? I am not sure if I am to be attracted or scared off by a property which has an asking price so much greater than the recent sale price.

There is a chronic under supply of accommodation in my city and the student population is booming.

Zoopla is one of those sources I mentioned you shouldn't take much notice of, they're bullshit, ego-driven valuations.

Lenders are the people who define the market value of a property, not some numpty who demands 300k for a 250k property. It is all to do with personal finances and risk to the lender.

Post: #10

I was in UK a week ago and I noticed that in Colindale (Zone 3) at the top end there’s 3 bed flats on sale up to £660K. That’s fucking crazy. You can live in a very nice flat in zone 1 at that price. I think it’s obvious that foreigners (mainly Chinese) are buying these flats as investments.

I can’t see any Londoners paying those prices. You can buy a 4 bed semi detached house with its own parking and a big back garden for £600K in the same area.

Colindale isn’t even a nice area!

I was told by a relative that some of the new flats are being given to people on the dole! There’s a huge shortage of housing in London. I wonder if that will cause prices to go down when there’s loads of DSS people living in the area.

Regarding Corbyn, I can’t see him ever being PM, he’s such a 70s left wing dinosaur, he’s unelectable.

Post: #11

Ask yourself this when it comes to analysing a property bubble in the UK ... Are prices rocketing upwards?

If yes then let's go through the following as you may have a bubble in your area of the UK :

Can supply be increased to meet or even supersede demand ? Key to this answering this question is whether there are height limits on your city, greenbelt protection, expensive regulation and powerful communities of NIMBYs who have political control over local planning approval processes that allows them to reject new housing in their area. If none of the above apply, then yes, supply can be ramped up aggressively beyond the point of demand. Probably a bubble.

Will demand decrease if prices started to decline (by 25%) or would people simply pile in at the cheaper prices. If the answer is yes to the former, probably a bubble.

Is the trend in your city one of overall population declining, thus reducing demand over time. If yes, probably a bubble.

Does the explosion of international millionaires interested in investing in UK property have zero effect on demand for property in your city ? If no, probably a bubble.

Is the economy in your city growing more and more irrelevant and insignificant to the overall UK economy over time ? If yes, probably a bubble.

Is renting in your town/city a supremely attractive option compared to buying in terms of financial consequences ? If yes , probably a bubble.

Is there no real foundation or structural cause behind rising demand in your part of the UK beyond mere speculation in the hope prices will rise ? If yes , probably a bubble.

Post: #12

Interest rates are about to rise in the UK from their historic lows. If this is the new trend then soon after will come repossessions of property as overstretched home owners cannot afford to pay their mortgages. This will cause a collapse in house prices by as much as 50% over a year/ So don't buy now, wait till that happens. Pay £85,000 for a flat not £170,000.

Post: #13

There will not be a property meltdown in 2016...

Post: #14

Credit markets are already overextended, combined with weak job markets in post-industrial countries and a massive amount of social unrest due to unassimilated migrants all throughout the Europe, you couldn't convince me to buy right now with someone else's money.

Post: #15

(01-07-2016 05:36 PM)Guitarman Wrote:  Interest rates are about to rise in the UK from their historic lows. If this is the new trend then soon after will come repossessions of property as overstretched home owners cannot afford to pay their mortgages. This will cause a collapse in house prices by as much as 50% over a year/ So don't buy now, wait till that happens. Pay £85,000 for a flat not £170,000.

I agree with this. Home ownership is a national obsession in the UK; this obsession causes people to overstretch themselves massively. I used to watch property TV shows - people always max out their "budget" or go over it by tens of thousands of pounds.

There's a whole generation of homeowners who have never experienced any interest rate rises whatsoever. I think 2007 was the last interest rate rise. Rates will rise, and that's when the shit-show will start.