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Alarming house prices!
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Newbie


Posts: 40
Joined: Apr 2008
Post: #21
07-03-2014 06:37 PM

Id urge anyone looking to buy a property at the moment to be extremely careful. Everything is extremely over-valued in London at the moment and properties are going for above the already too high asking price due to desperation. The economy is still weak and very little has changed in the past 5 years apart from the housing market. Its not normal -for example an average 3 bed house in FH to go from being worth 450k to 650k in the space of just 12 months! Thats inflation of nearly 50%! There is no way anyone can justify that especially when you consider nothing else has change in that period!

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Gump


Posts: 3
Joined: Apr 2013
Post: #22
07-03-2014 08:32 PM

Things obviously have changed otherwise how would people be able to afford the increased house prices and have begun to move out of choice rather than necessity. Considering FH is still very reasonably priced compared to other parts of london where you get a 1 bed flat for £650,000. Go ahead a be cautious and get out priced of an area that you want to stay in. Yes lending has become easier but restrictions are still there to stop people going over board. If you cant afford it dont buy it.~( but then the bank would most likely not let you anyway). I think better advise would be live within your means and buy what you can when you can because you never know when you will be in the same position again.

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Anotherjohn


Posts: 374
Joined: May 2005
Post: #23
07-03-2014 08:42 PM

Quote:
house in FH to go from being worth 450k to 650k in the space of just 12 months!


Forest Hill was a relatively unknown part of London until it became a destination on the tube map. This meant that for many years, whilst similar properties all over many better-known parts of London had seen their value increase, our undiscovered stock remained under-valued. What has apparently happened over the past year is that the town has been noticed and new demand for property has been created by potential buyers who dropped-by and have liked what they see. This merely brought FH house prices up, albeit very rapidly, to where they they probably should have been anyway and with the wider London property market going bananas right now it's easy to think that our properties have reached artificially high prices. If you look at other nearby towns you may consider that our property is still quite reasonably priced.

In my book the above quote could've been put another way -
house in FH took 7 years to go from 450k to 650k!

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Newbie


Posts: 40
Joined: Apr 2008
Post: #24
07-03-2014 10:26 PM

Its not a Forest Hill hike Another John it the whole of London in general. A lot of very average post codes in London have gone up by a similar %. The banks have laxed in their lending again and people are simply borrowing beyond their means. It may seem fine now but as soon as interest rates climb a lot of people will suddenly be in a lot of trouble.

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Anotherjohn


Posts: 374
Joined: May 2005
Post: #25
08-03-2014 08:54 AM

Newbie, trust me, jumps from 450k to 650k aren't as widespread as you suggest and Forest Hill really is quite unique in that it has always been relatively under-valued for a town with such good virtues. I know this because I have owned several properties here and in other parts of London since the mid-eighties and I study all aspects of my market very closely. By the way, the banks are not lax about lending - they are far, far more stringent than they were before the crash. Also, provided that you're sensible, don't be too terrified about the odd interest rate hike here and there because I, like all of my friends, were in 95% mortgages when rates rose overnight from 7% to 15% and we all got through it. I'm a glass half-full type of person.

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kingkong


Posts: 61
Joined: Oct 2006
Post: #26
09-03-2014 01:00 PM

http://www.woosterstock.co.uk/details/11794

Admittedly it is a very nice house, beautifully decorated, a lot of square footage, two bathrooms and so on, but £950k for a house closer to Catford than Forest Hill?

Does anybody else think this is asking too much?

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rshdunlop


Posts: 1,111
Joined: Jun 2008
Post: #27
09-03-2014 02:21 PM

Nice if you like grey...

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MightyMouse


Posts: 122
Joined: Apr 2012
Post: #28
09-03-2014 02:22 PM

It's only "too much" if no one will pay it. Given the current market, and the trend for "open days" which just draw on people's panic about the lack of available properties in their price bracket - I wouldn't be at all surprised if it's not "too much". Indeed, it may go for more.

A house near me (heart of Forest Hill) recently went up for £800k, "in need of modernisation". Sold sign was up within two weeks.

Me? I've come to terms with renting whilst I choose to remain in London. I refuse any longer to get caught up in the panic and frenzy, I will not pay more than my rent to buy something worse, and all in all I've more or less made my peace with the fact that this city no longer has any property I am both willing and able to buy.

There's always been parts of it where I could never have bought. That's now become all of it. I'm now thinking longer term, at which point there'll be a choice to be made - stay in London and continue to rent, or move back to the north where I could be a homeowner.

But, as a single childless person, there's more important things in life than mortgages and paying for new roofing! Or for Farrow and Ball paint... Wink

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Novels


Posts: 83
Joined: Apr 2008
Post: #29
09-03-2014 03:58 PM

Thank you for sharing this with us Mightymouse.

As to property prices: I am convinced it is a bubble.
A: properties get snapped up within days, no matter whether good or flawed.
B: there is no room for negotiations, no matter the asking price.

I think that as soon as interest rates start going up again, it will slow down, and we will see those not so good properties reappear on the market.

There will be winners and losers. I was extremely keen to move elsewhere but I might just hang on for another year or so...
I have also realised how fond I am of you guys! Smile

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Hillstop


Posts: 25
Joined: Feb 2013
Post: #30
09-03-2014 06:35 PM

I must admit I had a sharp intake of breathe when I saw the price of that house. They've done a beautiful job with it, but that is an East Dulwich price-tag. The receptions rooms aren't that big.

Will be interested to see what it sells for.

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shzl400


Posts: 729
Joined: Oct 2007
Post: #31
09-03-2014 08:04 PM

Very close to what I've heard is a quite highly rated primary school (Kilmorie). That may account for some of it.

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michael


Posts: 3,255
Joined: Mar 2005
Post: #32
10-03-2014 09:05 AM

A similar house in East Dulwich would probably cost £1.2m (example)
East Dulwich has been 20% higher for as long as I can remember, but in a market where house prices are rising by possibly 10-20% per year, it makes it difficult to keep track of market values.

My view (and I have no expertise in this area) is that the current growth rates are impossible to maintain. London house prices have been depressed for a few years, with little if any growth. This was mainly due to banks being unwilling to lend to first time buyers (plus a lot of belt tightening across the economy). Now we have increased government support for first time buyers, and some large bonuses being paid out to the wealthiest in society.

It isn't too surprising that prices go up a bit dramatically after this depression, especially in areas where houses are underpriced compared to other areas of London. But the growth should slow down and demand and supply start to match a bit better as people who have been unable to move in the last few years find places to move to. However, I find it very unlikely for house prices to drop below today's levels. And buying a nice house in Forest Hill still seems like a good investment in your future (if you are lucky enough to be able to afford it).

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ryananglem


Posts: 167
Joined: Apr 2009
Post: #33
10-03-2014 01:00 PM

I saw an interesting documentary last night on bbc world, that showed people from Hong Kong and mainland China and their investments in London property. London property is perceived to be cheap and safe. They are using property as a commodity and thus do not want the property to be rented as it depreciates it faster and they may need to sell it rapidly. Compared with Hong Kong when you pay 350,000 for tiny studio flat property in London is cheap and seems to be appreciating quickly (partly driven by demand from Hong Kong/China). They showed sections of the Hong Kong skyline at night, and many blocks are entirely empty as they are just owned by speculators who are only interested in the value of the apartment - rather than what its for ie living in.

I'm not really sure what the best option is given this environment.. it seems the bubble (if indeed there is one) is still a way off bursting.

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PackOfDusters


Posts: 30
Joined: Nov 2007
Post: #34
11-03-2014 09:21 PM

Despite the fact that I'm about to pay about £100k more than I thought I ever would for a perfectly ordinary 3-bed in Sydenham I do hope this is a bubble and that these prices are not the new normal. Otherwise I don't understand how anyone earning an average wage who doesn't already have property will ever be able to afford to buy anything.

Take this property for instance. I thought I'd seen it all, but this is ridiculous:
'4 bed' (ahem) house
Ok, so it's being marketed by F*xtons, but please someone tell me that price is a typo. It sold for under £250k less than 2 years ago!

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P1971


Posts: 816
Joined: Feb 2009
Post: #35
11-03-2014 09:51 PM

A house on my road was bought for £315k 3-4 years ago and was recently sold for £750k BUT do bare in mind 3 years ago there were lots of empty shops in the area. Since I opened just under 2 years ago I've seen 4 new decent independant shops open on Dartmouth Road and 1 very decent shop on London Road which was a SEE3 pop up that stayed. As far as I know 2 new shops are due to open next month on Dartmouth Road aswell as the new Railway Telegraph. There has also been a lot of press about the area being up and coming too, so maybe Forest Hill is finally on the map, and so it should be with all the hard work The Forest Hill Society and others have put in to make where we live amazing.

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rshdunlop


Posts: 1,111
Joined: Jun 2008
Post: #36
11-03-2014 11:08 PM

PackOfDusters - that's extraordinary. I don't think £700k can be right. I mean, seriously.

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Anotherjohn


Posts: 374
Joined: May 2005
Post: #37
12-03-2014 06:38 AM

'Extraordinary' - could be extortionate (if it sells at that price!).

I'm with you guys because this one is just silly. Three houses along there sold in 2013 for between £244,950 and £250,000 so that would make this a world-record 180% increase in a year. Can you imagine what some of the neighbours are thinking.

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rshdunlop


Posts: 1,111
Joined: Jun 2008
Post: #38
12-03-2014 07:03 AM

It's described as being in a 'charming cup-de-sac'. If you want to have a laugh, click on the 'street view' tab.

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PackOfDusters


Posts: 30
Joined: Nov 2007
Post: #39
12-03-2014 09:27 AM

I'm sure it's a perfectly nice place to live. In fact, the location is pretty good. But for that price you could get a substantially larger period property - even with the crazy increases we've been seeing. I wonder if they actually *want* to sell? I can't imagine there's going to be much interest in it.

I frequent a few local forums and *all* of them currently have threads with people expressing their consternation at the recent rapid rise in property prices locally.

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Londondrz


Posts: 1,538
Joined: Apr 2006
Post: #40
12-03-2014 10:59 AM

estate agents are know to inflate prices to get a property on board and then lower it when it doesn't sell The thing is, these days they do sell.

Two bed flats in FH have breached the £500k mark already.

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