Hi Campers!

The question we all want to know the answer to! I would like some opinions as to when prices will be at their lowest! What is your own opinion/theory etc...... when should I buy again basically........???!!!

I still think it will take a while for prices to go down, I expected more drops after the recent media coverage and was suprised there wasnt more......... what do ya'll think,

love sophia

In 4 to 5 years.

Agreed, 4-5 years until the lowest point, maybe. Saying that, there may be reasonable deals in 2-3 years imo, as most of the froth should have been blown off by then.

BTW, I thought the recent drops were pretty massive - what were you expecting Sophia? Armageddon?! 20% or so in 3 months is a very high figure and if it keeps up at that rate, I'll be changing my 'reasonable deals' time frame to 1-2 years.

At the end of the day, it's probably best to buy when you think the prices are 'reasonable' again. This may not be quite the lowest point, but at least you'd have avoided the high prices near the peak.

Buy when no-one is talking about property. When the man in the street is saying that it is a really bad idea to invest in property, you should start looking!

I agree with you Traktion. I find the drops massive too since I didnt expect price reduced until March and we started first week in January. I reckon a lot of the semis/estate houses are coming back to December 2006 now. (Thats when I started looking and house prices were starting to go really crazy with gazumping) I notice in the Lisburn area lots of exLA houses now coming on the market as people start to realise their dream portfolio is turning into a nightmare. I have personally heard of Canny MCSavvy investors regretting all the subsidised rent they paid for their "pension pot" now the pot is emptying fast.

I think this is going to happen a lot quicker than we thought. No-one expected this lack of 125% mortgage for FTBs to come in so quick and when we get back to proper affordability and stop paying the mortgage on credit cards then I think we are going to be pleasantly surprised. I dont intend to wait for the bottom - as soon as houses get back into kilter and I can get a decent house with a garden for a reasonable amount of money then I will be happy. (Reasonable would be Rateable value plus 15%)


Banks kick away bottom rung of ladder.
http://www.guardian.co.uk/money/2008/feb/26/banking

In answer to your original question Sophia, I could produce a long-winded answer pointing to different graphs (comparing index data and nominal data), acknowledging different variables, crystal ball time analysis etc. etc.

but instead I will refer to mmca22gr answer above which is bang on the mark.

When your 'average Joe' (not hpc readers) thinks that property is a bad investment and there is general widespread little appetite to buy, when the obsession with property has passed, when the majority of Estate Agents are humble with their opinion, when prices are stagnant and there is seemingly no possibility of future growth in the near to mid term future, this is the time to buy.

Warren Buffett's mantra through and through

PS - remember to target you preferred property a long time before buying, i.e. if you want a flat on the north coast, or a three bed terrace near Ravenhill, make sure you do your homework first, because there will be discrepancy between areas and property types.

I've been told already by a work colleague that I've 'missed the boat' again and prices are on the rise.

So there you go, the crash is over.

Don't worry, it was the Titanic.

Without knowing the person in question, but assuming they are an 'average Joe' who does not spend an exhaustive amount of their time looking at property prices etc. , then this is precisely why it is not the time to buy.

With the assumptions above still in place, when that person starts saying that buying property is for fools, well you might start thinking that it is indeed a good time to buy.......

apologies for the broad generalisations but hopefully the point comes through

The only thing I am certain of, is that all housing bubbles deflate differently. Sorry, I know that does not help.

I know a few people are rushing out and buying properties now. But this is now a falling market. Buying this year is a big mistake.

My opinion is that prices should look alot more reasonable by autumn 2010. Even then I will intend to be negotiating hard for a lower price.

I would expect to see the prices hit bottom around 2012 and remain there for several years.

While I like the short-sharp-shock theories. Repossessions and forced sales will take some time have their effect. Initially, I expected to see prices sticky on the way down. However, if prices are falling at £6,500 a month as the University of Ulster reports suggest - then these theories may prove correct.

This crash is accelerating, look at the reductions every week, once this feeds into the next quarterly report the heads will come off the chickens. The next report could bring average price to 200k - then who knows?

The earliest I will consider buying is end 2009, might be better end 2010

How's the baby?

I would like to buy in the Lisburn area. From my reading of this market I feel there will be further drops to come as there will be major supply coming to the market soon with some major developments such as the wood brook 'eco village' of up to 2000 units over the next ten years. So I believe with the further competition from these, which while not the cheapest appear to be priced a good 20k less then other developments in the Lisburn area and with the already high inventory already there looks like further falls to come. There does appear to be some movement in sale of the houses that are priced below the 'pack' but as a total of the stock on the market this is relatively small.
It also depends on how the houses above your basic semi goes as I believe there is a great demand for these type of houses in the area but without a reduction in the step up in price then there will be less people willing to put their house on the market and accept a lower price if that step up is not achievable.

There are many basic semis priced at the 220k level in Lisburn which in my opinion need to drop down to sub 200k to get any real interest in them as that is the level were in the boom that the action was happening with FTBs excluding the 'investor activity' which drove them above the 200k mark. I see many properties that had lots of interest sub 200k and offers but for what ever reason did not sell and are now back on at 220k and appear to be getting no interest at all. I feel that the price range of say around 160-180k for these semis would probably get the market going in the Lisburn area.

So I am thinking of buying maybe 2009 but it depends on how the drops occur! At the end of the day it is to be a home and not an investment!

Also I'll be looking for average house price @ 5 times average income. Then I'll be negotiating hard for a good price on my new house

Though I'll be keeping a careful eye on how bad things are in America... Interesting 5 page article...

Housing Meltdown - click here.

My prediction would be that most of the decline in house prices here will happen over the next 2 years.

I will be making no attempt to guess the bottom of the market; when I see a house I like at a price I think is reasonable, I will buy. Simple as that.

I would not be inclined to call bottom.... I suspect that we will have seen the majority of the falls within the next year or two. After that, any falls are likely to be less significant and thus it is safer to buy.

As far as when is safe to buy.... that is a different question. If you are in it for a longish term, you can safely buy as soon it is genuinely affordable to you. If you are in it for only a couple of years then you need to be a bit more cautious.

Sophia, there have been quite substantial falls already!!! It's definitely falling faster than the Republic even. I agree with Traktion (below).






Well, there you go! Blink and you missed the crash!



Seriously though - there may a few people who think like this, but there certainly aren't enough of them to soak up the ENORMOUS oversupply of houses that we have. So don't worry - the crash still has another 3-4 years to run I reckon! I'll buy as near to the bottom as possible - prices are now going in the right direction but they have some way to go before they get close to rateable value!!!

Talking about rateable value, I agree that's probably a pretty good point to aim for. Perhaps when we're approaching rateable value +20%, the bottom is approaching. It may dip below this or take an aye to reach rateable value +5-10% (as there *has been* a small, steady rise over the last decades).

It's quite handy to have that rateable value site to hand to check too. It makes is dead easy to find out where the "target price" is!

I agree! Can we have a new topic on it maybe?

I've put a link to the Rateable value site for newbies on the Useful site thread further down the page. I definitely think this should be a topic to see if we can track house prices coming closer to R.V. - its a great pity we can't get Land Registry prices for accuracy though since asking prices are no guide now.

I have my own reservations using RV data, like you say it's a shame LR data is not easily obtainable.

As you know (I'm sure I mentioned it a few times ) I am a big fan of Nationwides historical average nominal data, yes it has problems (delayed, averaged, no distinction between prop. types and areas) but it's real data, so I will be putting a link to this data on the other thread.

Keep it real

Can you expand? Not literally, obviously...

Yes - I am fond of tea-cakes!

Seriously, look at my example for instance, I live in a new-built house, we approached the council to notify them of the dwelling and start paying rates.

About a year later we got our bill and I saw our address listed on the RV website with the RV value.

Therefore, someone somewhere applied that value (yes they may have resourced historical data etc.) but basically the judgement was still on that person to apply a value. Hence, human error and all of the associated bias (if any) were in existence.

My point about Historical data is that, at least it is based on real sales (averaged of course) but real sales, not someones interpretation of what a house is worth.

edit - typo

I have looked at hundreds of 3 bed detached bungalows with garden about 15- 20 years old in various areas and to be honest there is not a great deal of difference between them with the rateable value. Mostly 130-150k with slight variations according to size of garden. Nearly all those houses are now 265-300k.

Where I live some houses are being advertised at circa 20% below peak value but a few are actually selling up to 33% below peak (to investors surprisingly) which brings them a lot closer to their rateable value. I think that is where prices will stop dropping in nominal terms as those desperate to sell will have sold and at those price points someone with a 15% deposit would see the rent covering an I/O mortgage. Other areas might not have have come this far this quick however-local EA's are being quite frank here!

Yes I've noticed too. Although there aren't that many, it is currently possible to purchase the odd house at RV+20%

Look at properties in the country the ratable value is usually lower than that of a home in urban or suburban areas, ( mostly to do with amenitiens, sewerage method, ect. ) Although some people might prefer to live in the country.

In 2004 I built a house 3400 sq ft @ £59 per sq ft = £200,600.00 that included a double detached garage and the house finished (ie wooden flooring, tiling). The site was £68,500.00 making the total cost to build £269,100.00. The ratable value of this property today is £270,00.00, this couldn't be the right value for a 3400 sq ft 6 bedroom home in the country on 1.2 achers.

The point being the ratable values don't seem to reflect the value of certain homes.

Yes I agree with this, especially with particular regard to country homes.

On the (country) road where I live, I know of many people who had their house built from scratch, so presumably their experience is the same as mine - in that it was up to the council to 'calculate' a value for rate purposes based on the number of rooms etc. from 'scratch'

Interesting post from the Motley Fool PP - can you advise if it is accurate?

from TMF

It's been suggested to me elsewhere that Nationwide cooked their books to reach a 0.5% fall in February. Were it not for downwards revisions to previous months, the February fall would have been twice as bad:

January report

Nov 367.9
Dec 366.4
Jan 365.9

February report

Nov 367.6
Dec 365.9
Jan 365.0
Feb 363.3

We've seen this kind of thing before from the VIs - using every trick available to massage their figures, short of simply inventing them out of thin air.

Hi Doccyboy

I have no knowledge of the above but interestingly I see the index figure being quoted.

When I compile graphs I never use the index figures only the historical average nominal quarterly figures (i.e. real average prices).

Obviously, the data is only as good as the source, but as you know yourself in NI you don't have many choices when it comes to data.

edit - funnily enough, I remember their being some discrepancy between what the nominal quarterly figures were 'saying' and what the price index was 'saying' for the last batch of quarterly figures (NI).

I suppose at the end of the day there is no substitute for 'being on the ground' and keeping a keen eye on prices in your chosen target area / property type.

2nd edit - I don't think Natwide are as VI as some other banks, I bank with them and they are strict on mortgage LTVs and income ratios.

The houses I have been looking at are older properties with much smaller floorspace and often single or no garage and no en-suites etc. I have always thought that rateable value plus 15% was a fair price for them in ordinary times.

I wouldn't be able to afford a large house like you built and would be wary of doing so because I know that houses like that in Scotland out in the country with few amenities would cost upwards of 3000 ukp in rates. My 3 bed house was 2000 ukp per year in a rural area. Rates will eventually rise over here to match the Uk as the money from Westminster dries up.

Couldn't agree more. That's why I value the input from Serpico and others on the way prices are going in their area. I spend a lot of time on propertynews and propertypal checking how prices go - its only with a lot of research you can hope to bag a bargain.

yep unfortunately so - when I moved over in 2002 I was paying £1200+ a year for a 2 bed mid terrace in SE18 (cheapest* postcode in London).

edit = *to buy at the time

Great to know. Can you provide examples? I haven't found any yet which fit into either category...




You built a house to your own specifications and I'm sure it is lovely. Regardless, the rateable or indeed the saelable value may turn out to be less than the build+site price. It can happen and has happened over and over again in the UK. Property is worth what someone is prepared to pay - no more, no less. When a house goes down in value, what is reducing is the value of the land on which it is built. If there are no takers for a house which is up for sale, it is impossible to gauge its true value - except to say that its true value is less than the asking price.

Those who believe that a house's worth cannot drop below site+cost price are mistaken. Lots of developers who bought land at or close to the market peak are finding that out right now.

Remember that rateable value is based on the January 2005 valuation of a property. It is not an unpenetrable barrier. I remember some homeowners at the time complaining that their properties were being overvalued at the time!
One chap, I remember, an SDLP politician - Alaistir McDonnell was complaining that his house on the Malone Road had been valued at 600k or so. He had bought it for much less and had spend a fortune renovating it. He felt he was being penalised for doing up his house
I think this is why the rate payments are capped at 400k

All very valid points Tara

To continue with a discussion from earlier........

I have high-lighted the above quote because any reasoned 'prediction' regarding the future of this 'law' i.e. what will houses be worth in the future requires a baseline of what houses were 'worth' previously.

There are differences in opinion as to what % movement (and time-scale) will occur, but I would avoid using RVs as my baseline because of their arbitrary nature.

Are they? This is ridiculous!

The prices, of course, are not capped at any value.

Why is it ridiculous? Dont forget what rates are 'paying for'. To make two houses pay vastly different amounts for the same services, just because of what the property is worth, seems to be a concept which is biased towards the 'have nots'. Ultimately I think you should be rated on the services provided.

I have to agree with you, Imagine if they made petrol more expensive for new cars and cheaper for old ones. I think it is going a bit too far to discriminate against people based on where they live, especially as it is not means tested or income related.

the end of this market has to be viewed in the context of the inflation which we will surely see over the next few years. In effect I would call its end as such in 2.5 - 3 years. However that does not mean that prices will drop for all of that time and indeed there may be increases but when inflation is taken into account any such increases will be seen to be falls in real terms.

Good point Vicmac - inflation is one thing, but rises in earnings is something else. With 70% state sector employment here, most earnings are rising at 2% or so at the minute.
With the utter lie that is CPI, people are effectively getting their pay cut at the moment as the real cost of living is shooting up faster than 2%. This may exacerbate the crash

Precisely. It's a scam perpetrated by the rich upon the poor. Are you in favour of capped income tax as well, say at #100,000? Fab - that extra half million I made last year is mine, all mine, all mine, I'm walking on sunshine.

We live in a country where nobody is allowed to be badly off just because they are lazy or stupid. Personally it seems to me that the rich (most likely reading the intelligent, hard working or descending from one of these) are being screwed over by the poor. It pains me greatly that I work my ass off and pay taxes to enable some social/intellectual retard to sit at home in wait of the weekend when they go out to get pi**ed and cause trouble. If nature had its way, these people would die long before they can pollute the world with offspring. Unfortunately, our country is very successfully breeding these people.

Well, no. I see lots of people every day who are lazy, stupid and poor. I also see lots of hard working folks who keep the place going who are poor. And I see others who are lazy, stupid and rich, just because daddy left them it. And now you're feeling "pained", Darwinian and Malthusian, have you dismissed the hard working who happen to have bad health? Possibly you reject health care as well for the same reasons.
There was only one reason for capping rates. Letting the rich hold on to their stack. Does that pain you? It pains me. I think it's disgraceful.

The hard working but unhealthy and 'rich kids' cases are in the minority. The majority of those on benefits are either too stupid or too lazy or are unable to keep their legs together.

I dont believe your arguement is one which will be supported by many intelligent and successful people. Basically you are saying that anyone who has more than you has to pay some of it back because it is not fair. You are wishing to penalise those people for doing well. That is what is wrong with this country, you get rewarded for being a bum and penalised for being successful.

I live in a 5 million pound house, on my own. You live in a 400k place with a wife, 4 children and 2 dogs.... you would be costing more to maintain than I would. Why should I pay more?

If I use the same services as the guy down the road, why should I pay more just because my house is on a nicer site?

Incidentally, I probably work with your cousin if he is physics in QUB.

[quote name='talksalot81' date='Mar 4 2008, 11:44 AM' post='997988']
I live in a 5 million pound house, on my own. You live in a 400k place with a wife, 4 children and 2 dogs.... you would be costing more to maintain than I would. Why should I pay more?

If I use the same services as the guy down the road, why should I pay more just because my house is on a nicer site?

Incidentally, I probably work with your cousin if he is physics in QUB.


Rates in NI really only pay for street cleaning and bins, graveyards and the sports facilities. Oh - and junkets.Other more sensible countries have equivalent taxes which pay for education etc. My four children will not be costing your rates bill anything, and they'll be paying your pension when they grow up to be taxpayers. The dogs are outside the tax system provided I clean up after them. I might be having more crack as well.

Here in Lurgan/Portadown, or Craigavon as some insist on calling it, the rates are paying for inter alia a ski slope and a really rather charming horse jumping facility. I really don't think many terrace dwellers are availing of those facilities, do you? All together now - it's the rich wot gets the pleasure, it's the poor wot gets the pain....

But as a larger family, you will contribute more to messing the street, you will produce more waste for the bins, you will have more people to die and need a graveyard and mroe likely to use sports facilities....

Sorry - another thought. The premise that the rich pay more tax than the poor has been prevalent since the reign of, yes, the Man Himself, William of Orange. Another reason to Rem 1690. I don't see why that had to be changed to suit a few rich bods off the Malone Road. "Socialist" MPs included.

Good heavens. Have you heard of VHEMNT? They're the voluntary human extinction movement, who believe no one, that is no one, should have any children. Check them out now before they're extinct. And remember - if your parents had no children, you probably won't either