> The market has definately been flat in the southern home18 Holyhead court sold for 210,000 in May 2004 sold again this august for 227,500, an 8% increase in two and a bit years.
>> counties for 2 years. God know where this place is that is
>> having 10% pa increases
> Kingston-upon- Thames can only manage 25%
> :)
>formatting link>formatting linkTrying a couple shows a small movement. e.g
This is only a theory, but when value of property goes up, it encourages home improvements etc which add a non-inflationary increase to house prices. However statistics don't include price increases through house improvements. A better bet is looking at the house price indices of new builds where things look far more stagnant.
If prices went down wouldn't people be more likely to carry out home improvements than move?
Only if they were thinking of trading down or of becoming tenants.
I don't understand Peter's point:
If house prices went *up* surely people would be more likely to carry out home improvements? Home improvements are relatively static in price aren't they, so you get more "extra house" for your money?
My thoughts as well. There was an article which gave an example in Greater London, where if you add a bedroom you add in excess of 100,000 to the value of the house. That tends to encourage home improvements! It really doesn't cost that to make an attic room.
When prices are going up people usually want to buy a more expensive house to achieve a bigger absolute profit in the future.
Home improvements rarely result in a profit because if people prefer to have the choice of doing them or not and if they do them they want to choose how to do them.
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