2006-08-21 02:01:22 · 17 answers · asked by Anonymous in Business & Finance ➔ Other - Business & Finance
I think the housing market has gone crazy. My boyfriend and I have just bought our first house together, we are in loads of debt now and will be paying our mortgage over 34 years!!!!!!!!!! I think house prices went up because there was a huge demand when people stated buying houses to make money- e.g. property developers and the letting market. I don't think people should be able to do this because it prices first time buyers out of the market. I even see new houses go up for sale that have just been built, somone buys them and then a few weeks later they're back on the market again, to make a profit. Its all wrong.
2006-08-21 02:09:35 · answer #1 · answered by juliamc 2 · 0⤊ 2⤋
The price of a house is determined by economic forces, e.g.
1. Availability of property - i.e. a shortage of property will increase prices.
2. Price of money - i.e. cheaper mortgages, government subsidies such as the reintoduction of tax relief would increase the value of properties since there would be an increase in the demand for mortgages.
People have been priced out of the market, because the market can survive without them. Firstly, it was single people being priced out, then poorer couples.
2006-08-22 13:36:38 · answer #2 · answered by nemesis 5 · 0⤊ 0⤋
Simple supply and demand. What a buyer & a seller will agree. Buy to let mortages became readily available so people could take capital out of their own homes (prices & incomes had risen) to fund deposits for properties to rent out. The prices or what lenders will lend depend upon what tenants will pay. It is what the tenant pays that covers the cost of the mortage. So lenders will lend but only up to a point. It means prices can't rise rapidly forever but the price is no longer controlled only by the affordability to first time buyers. Its not corruption its just that the financial structures in our society favour those with money!
2006-08-21 10:18:30 · answer #3 · answered by Frank M 3 · 0⤊ 0⤋
It is a collusion, a conspiracy!
NOT! But, the rising prices of homes is a play on high expectations, the synergy of realtors who get commissions, and lenders who are happy to lend half a million to someone to collect all that interest, and the TV wannabe millionaires who 'flip' homes!
Realize that at any one moment there are 60,000 to 600,000 homes on the market, and the dreamhome expenses can exceed the paycheck reality!
Also realized that there are over 1 million American millionaires, and a new one is 'made' every hour! It is the land of opportunity!
My experience is that it is just as easy to lose your shirt when you try to sell a home, because you don't see the homes that have depreciated in the market, hyped up on TV, until after they are re-furbished and sold at a profit!
2006-08-21 09:14:02 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Buyers decide the price, and amount of property available, lots of people wanting to buy, decrease in the number of appropriate properties, then the price goes up. No corruption, just normal supply and demand. Same thing happens in many fields.
2006-08-21 09:33:58 · answer #5 · answered by mike-from-spain 6 · 0⤊ 0⤋
It's not corruption - just human greed and stupidity.
Estate agents try to persuade you that houses are more valuable than they really are (the more you pay, the more their commission). Mortgage lenders ditto (the more you borrow, the more they make). Even friends and family will try to lure you in with lies like "nobody ever lost money investing in bricks and mortar".
If people had the nerve to say "wait a minute, that house isn't worth anything like that!", all the prices would fall. But like lemmings we prefer to price ourselves out of the market.
2006-08-21 09:11:54 · answer #6 · answered by gvih2g2 5 · 1⤊ 0⤋
Usually an Estate Agent will give an indication as to how much they could sell the property for. I suppose the true answer is that a house is worth what someone will pay for it.
As to coruption then I do not think so unless an Estate Agent seels the properrty below market value and then make a bigger profit from selling on.
2006-08-21 09:11:06 · answer #7 · answered by Big Tall Paul 2 · 1⤊ 0⤋
Youve got to be brave and get on the property ladder, my parents had sleepless nights when they bought there first house 40yrs ago, I did as well about 10 yrs ago, thought I would never afford the payments.
most people Could pay cash for my parents house now, if it was the same price.
In the 80s(uk) interest rates were about 17% that was tough.
2006-08-21 17:34:11 · answer #8 · answered by annon 2 · 0⤊ 0⤋
the market decides the price. this is based on supply and demand. at this moment the number of houses being sold has increased, while the number of people buying has decreased. when people cant sell their houses at the higher prices they want, the price comes down.
2006-08-21 09:10:06 · answer #9 · answered by Sam 3 · 1⤊ 0⤋
The cost of any house starts with the tax records of that home and the other houses in the neighborhood that fit the same description of yours. The additional value is based soley on the location, and the qualities of the house. You can get all this information as public record.
Good luck.
2006-08-21 09:33:08 · answer #10 · answered by Denise W 6 · 0⤊ 0⤋