House prices

[_V_]

https://www.bbc.co.uk/news/business-59147718

A typical UK home costs more than £250,000 for the first time after prices rose by 9.9% in the last year, according to the Nationwide.


The building society said the average house price was £250,311 in October, up 0.7% on the previous month.


It said this was an increase of £30,728 since the start of the pandemic. Covid has coincided with intense demand from buyers unmatched by supply.

Great news for those that invested heavily in BTL property, anyone been in the game for the long run? Very tempting to sell into this buying frenzy and all time high.

So many property millionaires created.

[Mordac]

We haven't had a House Price Crash Doom thread for ages, I thought this was going to be one.

[Paralytic]

Just a link to the now-daily BBC house prices article.

[pjt]

https://www.bbc.co.uk/news/business-59147718



Great news for those that invested heavily in BTL property, anyone been in the game for the long run? Very tempting to sell into this buying frenzy and all time high.

So many property millionaires created.

Been on the BTL train for about 12 years. Sitting with 8 properties 5 totally paid off the other 3 paid off by the end of next year. Looking at a very health portfolio with very little debt (none by next year). My only regret has not been to leverage more as I've paid down the debt. But I've taken a low risk approach using much of the profits from the rent to kill off the debt so I can sleep easy.

[ladymuck]

My younger self was very risk adverse and sometimes I wish I'd kept my little flat in Worthing as a rental instead of selling it. It appreciated well enough that I could have drawn equity out to buy another home to live in but I was more worried about the risk of having to pay two mortgages if it didn't rent well. I was a permie at the time, so definitely in a different mental space.

Now I'm no longer on the property ladder, and unlikely to ever get back on it, so it's all moot. I've never felt particularly tied to property and like the flexibility of renting. Two months' notice and I can be off.

[NowPermOutsideUK]

Been on the BTL train for about 12 years. Sitting with 8 properties 5 totally paid off the other 3 paid off by the end of next year. Looking at a very health portfolio with very little debt (none by next year). My only regret has not been to leverage more as I've paid down the debt. But I've taken a low risk approach using much of the profits from the rent to kill off the debt so I can sleep easy.

Given that wealth and rental income coming in can I ask whether you continue to work and if so why as you wont be able to spend it ...

[pjt]

Given that wealth and rental income coming in can I ask whether you continue to work and if so why as you wont be able to spend it ...

Still working and no intentions to stop. My BTL portfolio has always been looked at as a retirement plan. When I pay the others off I may start buying some more to build on the portfolio. But the cash coming in for this is being reinvested. If the contracting goes tits up at any point I can start to use the BLT income as my warchest but for now I'd rather use it to build up a hefty retirement income.

[BigDataPro]

My younger self was very risk adverse and sometimes I wish I'd kept my little flat in Worthing as a rental instead of selling it. It appreciated well enough that I could have drawn equity out to buy another home to live in but I was more worried about the risk of having to pay two mortgages if it didn't rent well. I was a permie at the time, so definitely in a different mental space.

Now I'm no longer on the property ladder, and unlikely to ever get back on it, so it's all moot. I've never felt particularly tied to property and like the flexibility of renting. Two months' notice and I can be off.

Personally I think you did the right thing by selling that flat. Flats come with financial burdens such as Ground Rent + Maintenance + Lease period etc on top of usual things. Besides generally a flat don't yield a considerable profit even when you sell it (as opposed to Semi for instance).

[d000hg]

Technically we own 3 BTL properties although none were exactly planned that way:

1. We still own our first home bought in a tough village at (it turned out) the peak of the early 2000s boom. We left in the early days of my freelancing career when I was effectively working 2 full-time jobs... literally just moved out and left it empty because we could afford to and couldn't hack the stress of awful neighbours. Value collapsed about 1/3 so we reluctantly became BTL landlords to a string of rather hard-work tenants, the sort who post the keys through the agent's letterbox without notice and just disappear.
2. A flat we bought in the Cornish seaside after my parents passed away, in the same area, ostensibly to retain a link with the area by running a holiday let we could use. As it turns out we had a murderer downstairs and nobody would take it on as a holiday let - I was literally down there setting it up when I got the call and spent a day packing up all the flat-pack furniture to send back- so it became a regular rental. Doing OK but not especially convenient. I think I slept in it one night in a sleeping bag, my wife has only ever visited it when we looked round.
3. We bought a house in our village for cash as a way to help/invest in a young family in our church. They do a lot of voluntary work so we basically said we'd rent it to them near cost. Putting our money where our mouth is I suppose.

1. is currently in the final throes of being sold for what we bought it for, after the agent phoned me earlier this year and strongly advised it. In a rough NE village they had something like 12 visits on the first day and 4 offers. Dragging on very slowly though.
2. has probably jumped a lot in value thanks to dumb luck owning in Cornwall during Covid. We plan to sell.
3. has probably jumped, Zoopla guesses 30% though I have no idea if I trust it... rural Durham has seen quite big rises too.

When my parents passed we ended up with their 2 properties - not sure if the most we ever had was 5 or 6 properties but I did not enjoy it. As it turns out we seem to have done well from it despite our best efforts to make bad decisions but it's not something I'd really choose to do.

[agentzero]

I would expect contractors to look through statistics to determine how they are calculated.

The main reason average house has risen in price is a simple change. There are now many more transactions of houses that are larger and have always been worth more. Many people are relocating to larger houses in the city and countryside.

If ten houses sell for £100,000 and two houses for £800,000, the average is lower than the inverse of two houses at £100,000 and ten houses at £800,000. This middle and upper segment of the market is seeing huge volumes of transactions, many more than have occurred since 2008. If you pay then you can see these stats on rightmove as a faux agent. I separate housing into three categories: low, medium, high. Most middle classes aim for the medium, £300-£550K. While these have also increased in price, the high end has definitely increased. Very large housing that was under £1mil after the financial crash is now selling for multiples of that.

I see it as the rich dispensing of assets at a peak and I am acting accordingly by avoiding purchase of those at this time. Volume of transactions in each low, medium, and high segments should be examined. Volume is up in medium and high, in some areas down in the low segment or static.