[Sender]

I'm in the process of getting ready to put a house on the market in south east London. Probably sometime early in the new year. The plan is to buy another 'project' for re-development.

I'm aware how notoriously difficult it can be to predict the housing market. Despite this, I'm curious what are forum members thoughts about where the property market will go in the next few years in London? Any specific advice you could give me?

I DO have experience in this area but always good to hear other intelligent people's opinions.

[sterlingarcher]

I've been following the London property market, especially over the past few months.

One thing I've definitely come to be wary of is irresponsible alarmist journalism.

It's fucking ridiculous sometimes, 'London property market GROWTH crashes!' 'London property market TUMBLES! (goes on to detail 0.2% fall)'

That said, prices are crazy, way out of wack with wages, foreign buyers that inflated the market have melted away (Russians/Saudis), property at the top of the market is being sold at MILLIONS below asking price, interest rates are at a historic low and are certain to rise (and it won't take a lot to cause pain for many) and you've got the shadow of a hard Brexit.

A friend bought a flat in central London 7 years ago, and it has since doubled in value.

BUT its a low rise world city that will always be in demand where expansion is always going to be restricted?

Bottom line, no one knows. We're horrible at predictions. You've read Naseem Taleb?

Ignore the press, I'd say. But the underlying climate points to a correction, maybe?

I'd look at Candy and Candy for an example. One of the brothers just sold off a mansion for GBP 53 Mil. Looks like they say sell.

[Castillo]

There’s a saying - it’s never a good time to buy, so just buy anyway and hold long term.

As you are moving from one place to another the loss on one place would be made up by the next place being cheaper.

I bought on Commercial Road E14 in 2007. In 2008 the market crashed and the flats in my block were selling for 20% less. It took 3 years to get back to what I paid. I sold after 8 years for £150k more than I paid.

A massive correction is due. But I’ve been saying that for the last 5 years lol. You can always put it on the market and test the waters. You just need one person to bite.

[Sender]

Sterlingarcher, your response echoes pretty much exactly my thinking at the moment.

(09-09-2018 02:08 PM)sterlingarcher Wrote:  

I've been following the London property market, especially over the past few months.

One thing I've definitely come to be wary of is irresponsible alarmist journalism.

It's fucking ridiculous sometimes, 'London property market GROWTH crashes!' 'London property market TUMBLES! (goes on to detail 0.2% fall)'

This endless stream of scare-mongering news stories is annoying and irresponsible.

What's interesting is that they're often found in the more leftist media outlets like 'The Gaurdian'. Post-economic crunch there's been an increasing and alarming agenda to depict property developers and, in particular, Landlords as these moustache-twirling vampires leeching the blood of the downtrodden.

Whilst I admit I may not be quite as 'rightist' in my thinking as perhaps some other members on this forum, the idea of a Corbyn government scares the crap out of me. I suspect it would be a disaster for the economy and the death of entrepreneurialism in the UK.

(09-09-2018 02:08 PM)sterlingarcher Wrote:  

That said, prices are crazy, way out of wack with wages, foreign buyers that inflated the market have melted away (Russians/Saudis), property at the top of the market is being sold at MILLIONS below asking price, interest rates are at a historic low and are certain to rise (and it won't take a lot to cause pain for many) and you've got the shadow of a hard Brexit.

A friend bought a flat in central London 7 years ago, and it has since doubled in value.

BUT its a low rise world city that will always be in demand where expansion is always going to be restricted?

Bottom line, no one knows. We're horrible at predictions. You've read Naseem Taleb?

Ignore the press, I'd say. But the underlying climate points to a correction, maybe?

I'd look at Candy and Candy for an example. One of the brothers just sold off a mansion for GBP 53 Mil. Looks like they say sell.

This is exactly the dilemna I (and every other developer!) face. On one hand, London will always be in demand property-wise. On the other, there has been years and years of over-inflation.

As for Brexit, that really is the proverbial riddle, wrapped in a mystery, inside an enigma. It's hard to know wtf will happen post-brexit since we don't yet know what brexit actually is. My cynicism tells me whatever happens I'm the one who'll be screwed.

(09-09-2018 02:08 PM)sterlingarcher Wrote:  

You've read Naseem Taleb?

I haven't. But it looks like I should.

[Sender]

(09-09-2018 02:24 PM)Castillo Wrote:  

There’s a saying - it’s never a good time to buy, so just buy anyway and hold long term.

As you are moving from one place to another the loss on one place would be made up by the next place being cheaper.

I bought on Commercial Road E14 in 2007. In 2008 the market crashed and the flats in my block were selling for 20% less. It took 3 years to get back to what I paid. I sold after 8 years for £150k more than I paid.

A massive correction is due. But I’ve been saying that for the last 5 years lol. You can always put it on the market and test the waters. You just need one person to bite.

I'm in a position to afford a (mortgage-free) property in London thanks -- in part -- to growing my capital through other development projects that I did in another cheaper town of the UK. Following that experience, I'm aiming to make this my full-time work. So holding on to the property isn't the ideal option, unfortunately.

What I have going for me is that I'm capable and experienced in doing much of the building work myself. I also have access to a few skilled tradesmen at good rates in London.

Admittedly, doing developments in a falling or static market is nerve-wracking. I'm just debating whether it's foolhardy.

There's a part of me that says that with enough entrepreneurial drive and some ducking and weaving it should still be possible to add value to a project no matter the market conditions.

I want to be in a position that I can live without working as quickly as possible. This isn't gonna happen without some risk or going back to working for 'the man'.

[jbkunt2]

With what you are trying to achieve, you can do everything right and it still go tits up due to a crash. I think you have to be in a position where you can hold the place for five or so years.

Brexit is also a big question mark. It’s really the unknown. A hard Brexit might not even do much damage but we just don’t know.

[cycl0ne]

(09-09-2018 03:50 PM)jbkunt2 Wrote:  

With what you are trying to achieve, you can do everything right and it still go tits up due to a crash. I think you have to be in a position where you can hold the place for five or so years.

Brexit is also a big question mark. It’s really the unknown. A hard Brexit might not even do much damage but we just don’t know.

Hard brexit would harm the UK economy badly mainly due to the lack of what model the UK government want to adopt (WTO, Swiss etc). It has been 2 years now and no progress has been made (Irish border, movement of people, etc). This is bad for both brexiters and remainers alike as businesses aren't going to wait, with some already moving. Inevitably it will the little man that will feel the pain, especially the current 20-40s generation. As a side note, you will notice that top brexiters/backers all seem to have back up plans

So as not to derail the thread, why the draw to London and not say the neighbouring commuter towns?

[MrTickle]

I thought the days of flipping property especially in London were long gone. Have been keeping a close eye on the market for a few years and whilst I don't think there will be a crash I think the steam has come out and it will flat line for a few years. Thus, money to invest might be better somewhere else.

That being said local knowledge will always trump the above, for example areas along the new cross rail route may see localized growth. I am not in London so I can't offer any.

[Sender]

(09-11-2018 09:09 AM)MrTickle Wrote:  

That being said local knowledge will always trump the above, for example areas along the new cross rail route may see localized growth. I am not in London so I can't offer any.

There maybe some areas still left in London that seem undervalued as they have yet to go through the inevitable process of gentrification. Particularily in the suburbs of south London.

As for crossrail, I've actually been keeping a lazy eye on the massive development pojects that Berkley Homes are doing Woolwich and Kidbrooke. Having spoken to one of their salesman, they seem to be doing well.

[Constitution45]

That is the East London line, areas along that line have been gentrifying for the last few years now, it appears to have slowed down a bit.

Properties around Lewisham, Catford and further out in Bromley would be worth a shot at, as they all have new developments coming into fruition.

Bottom line is, no one knows how Brexit is going to play out, anything can really happen. Also there is the whole threat of what is going to happen with the next government coming in, Corbyn looks like a possibility and that will really put a spanner in the works.

My guess is that London will stay stable due to the amount of international money here. Even with widespread rioting like 2011 again and the public services completely collapsing due to lack of money, it would take something special for people to stop flocking here.

[Longshanks]

Sidcup is the best value area in SE London if you get a large house imho. Discussing London as a flipping proposition is ridiculous.

[Bikal]

Having bought and sold in London, my opinion is that London property will always be hot if you're targeting a particular wealthy area, that said those properties are being sold for a lot less and some new builds aren't being sold at all, even at a discount/free car.

I do believe that if Brexit ends up being a mess, there will be a correction of the UK markets as a whole, not just property so I'd be wary to invest what I could not afford should IR changes negatively impact your holdings but if you can weather the storm, go for it and target the areas undergoing gentrifying or a solid area already that will take a hit but then rise again as it did during the 2008 and 2011 dips.

[Lino]

Interesting thread.

I am thinking about investing in London. How much would it cost to get a 1 or 2BR in a decent location, it doesn’t have to be fancy but not ghetto neither.

I have seen some properties, is the price a good reflection of the current prices? Is it possible to negotiate? Are there additional costs?

For instance this 2br house near Angel station:
https://www.rightmove.co.uk/property-for...74410.html

Or this 3BR flat near Canary Wharf:

https://www.rightmove.co.uk/property-for...51358.html

I am thinking having a base in London and renting it while away can be a good investment despite the brexit, your thoughts?

[Lino]

(12-12-2018 09:29 AM)Lino Wrote:  

Interesting thread.

I am thinking about investing in London. How much would it cost to get a 1 or 2BR in a decent location, it doesn’t have to be fancy but not ghetto neither.

I have seen some properties, is the price a good reflection of the current prices? Is it possible to negotiate? Are there additional costs?

For instance this 2br house near Angel station:
https://www.rightmove.co.uk/property-for...74410.html

Or this 3BR flat near Canary Wharf:

https://www.rightmove.co.uk/property-for...51358.html

I am thinking having a base in London and renting it while away can be a good investment despite the brexit, your thoughts?

Actually I just noticed that the first property is for sale by auction so the final price might be way higher.

[edlefou]

I used to live in that area many years ago. It was sketchy, but cleaning up since the St. Pancras reno and Eurostar changed from Waterloo.

The canal is good for running and cycling and you can head to Camden or Shoreditch pretty easy.

It's the typical shitty, tiny British flat. I personally wouldn't move back to the UK and live there, but could be a good rental property.

The other shitty thing is it's a leasehold, so it won't be as expensive as freehold, but you don't own the property. That would be a deal breaker for me.

[Lino]

(12-12-2018 07:32 PM)edlefou Wrote:  

I used to live in that area many years ago. It was sketchy, but cleaning up since the St. Pancras reno and Eurostar changed from Waterloo.

The canal is good for running and cycling and you can head to Camden or Shoreditch pretty easy.

It's the typical shitty, tiny British flat. I personally wouldn't move back to the UK and live there, but could be a good rental property.

The other shitty thing is it's a leasehold, so it won't be as expensive as freehold, but you don't own the property. That would be a deal breaker for me.

Thanks for your feedback. I don’t know that area well but I thought it would be a good neighborhood because it’s 10 min walk from Angel tube station.

Good point for the leasehold, I didn’t even know that was possible as where I am when you buy you become the owner of the flat and the land.

I agree the house doesn’t look good but to me a 2BR house near Angel for £350k seemed like a low price, I guess you get what you pay for.

[Lime]

Dont let it deter you, but in London you need a permit already to hammer a nail in the wall. Keep it in mind.

[SteezeySteve]

Long London highend housing market
Short liverpool suburbs

Finance industry will take a hit in the next few years so you could probably extort them on rent.
And I have a feeling the blue collar classes over there will have some more buying power.


I'm just a dumbass american though so maybe I'm fucking wrong.