Are houses selling?
Discussion
blade7 said:
I don't know what is going to trigger it but when the bust comes some people are going to have massive negative equity. I know several people that just walked away from their house/mortgage 20 odd years ago. Waited a while, paid around 10% of what they owed to clear it and bought again.
Of course people will feel they've lost money if the value of their house drops, but are there really that many with such high LTV's that they're in danger of "massive negative equity"?Rangeroverover said:
I'm an agent, many houses stay on the market as they are over priced, what usually happens is
Agent 1: In his heart of hearts he thinks its worth £450, he knows that two other agents will be pitching on it and he also knows that most householders will always go with the person who dreams up the biggest valuation. So he goes £475,000
Agent 2: will guess what agent 1 has done and go £485-490,000
Agent 3: will now value it at just under £500,ooo
As the losing agent when you call and ask them do they really think they can get that much, standard answer is "well its worth a go you never know". The problem is the vendor now has £500,000 in their mind, they look at houses on the basis that they will get every penny for their house and manage to knock 5-10% off the house they want to buy.
Everything that is priced right will sell, it may not be fast but within 6 months.
Fixer uppers are priced about the same as ready done, doesn't make much sense. Part of the reason they aren't selling is the sort of young buyer who wants them have already stretched as far as they can to get the house. Cash for doing the house up is real money not mortgage money and most of them don't have £20-50,000 extra cash
As a seller I have fallen for the above and it probably cost me money as I was selling just as the market was dipping in the late 80s. If I had gone with the lowest price advised, £145k, I am sure I would have sold quicker at around £140k. Instead I held out, initially at £170k, and ended up taking my company's home equity offer, £132k, in desperation. The house sold eventually for less than £120k. I know that the total hit to the company was around £20k including interest and charges. I always remind my kids of what can happen. Agent 1: In his heart of hearts he thinks its worth £450, he knows that two other agents will be pitching on it and he also knows that most householders will always go with the person who dreams up the biggest valuation. So he goes £475,000
Agent 2: will guess what agent 1 has done and go £485-490,000
Agent 3: will now value it at just under £500,ooo
As the losing agent when you call and ask them do they really think they can get that much, standard answer is "well its worth a go you never know". The problem is the vendor now has £500,000 in their mind, they look at houses on the basis that they will get every penny for their house and manage to knock 5-10% off the house they want to buy.
Everything that is priced right will sell, it may not be fast but within 6 months.
Fixer uppers are priced about the same as ready done, doesn't make much sense. Part of the reason they aren't selling is the sort of young buyer who wants them have already stretched as far as they can to get the house. Cash for doing the house up is real money not mortgage money and most of them don't have £20-50,000 extra cash
My neighbour is a respected local agent. He makes me chuckle when he tells me stories of how clients tell him what their house is worth and set the price against his advice. He is usually right from seeing what sells in our area. BTW he told me he lost 5 sales in the week after Brexit. People pulling out in fear for their jobs, typically mid-career young family types.
Sheepshanks said:
blade7 said:
I don't know what is going to trigger it but when the bust comes some people are going to have massive negative equity. I know several people that just walked away from their house/mortgage 20 odd years ago. Waited a while, paid around 10% of what they owed to clear it and bought again.
Of course people will feel they've lost money if the value of their house drops, but are there really that many with such high LTV's that they're in danger of "massive negative equity"?iain014 said:
Brentwood/Shenfield - Still utterly ridiculous. Some thing are taking longer to sell than previously, but they are still actually selling. The prices of 2 bed Victorian railway cottages have near on doubled since I started looking 3 years ago. Santander are valuing my place at 25% more than they were when I remortgaged in December. Was very lucky to have got in when I did as there is no way I'd be able to buy again from a standing start.
Yup, may partly be the Crossrail effect although Brentwood already has excellent transport links to London. On the increase in value - I recently changed mortgage deal (to a lower LTV) and the online valuation cleared it easily - putting almost a 50% increase on the price I paid new in 2011; considered in isolation that's high return albeit not as high as other properties.
There are some one bed studios being built on Kings Road (above commercial) that will be going on for over £300k. In fact, the pricing of 'good' flats seems very high relative to the price of houses in the area, but according to Rightmove they are selling (at what price though isn't clear).
blade7 said:
I don't know what is going to trigger it but when the bust comes some people are going to have massive negative equity. I know several people that just walked away from their house/mortgage 20 odd years ago. Waited a while, paid around 10% of what they owed to clear it and bought again.
Agree, i think it will happen at some point, which is a good reason for avoiding high LTV's if your lucky enough to be able to. As a first time buyer the combination of a property bust and rocketing interest rates are the two things that keeps me up at night and has made me avoid stretching myself too much. I got talking to a chap on the train the other day though who gave me a view I hadn't really considered previously and was an interesting way of looking at it Broadly he was saying that
"If I carried on renting I would lose £10k a year anyway. So if I spend the same on a mortgage and get any of the amount I pay back I am better off, OR i can afford for my property to drop by £10k per year and I'm still no worse off than i was......"
Not perfect logic I appreciate, but I kind of like his way of looking at it!
Brexit scythed the top end market where I am in NW London. Tons of uncertainty/negative sentiment as many buyers are international and/or exposed to the financial services sector in some way. #
The local agent tells me only a third of are still going through as planned - a third have gone for good and a third are subject to all sorts of gazundering/delays/slow death. This has just happened to a mate of mine who was all set to move out to the countryside somewhere but is now having to stay.
Thankfully I was a few weeks ahead of him and exchanged just before Brexit and completed the week after. Kerching.
The local agent tells me only a third of are still going through as planned - a third have gone for good and a third are subject to all sorts of gazundering/delays/slow death. This has just happened to a mate of mine who was all set to move out to the countryside somewhere but is now having to stay.
Thankfully I was a few weeks ahead of him and exchanged just before Brexit and completed the week after. Kerching.
ChasW said:
As a seller I have fallen for the above and it probably cost me money as I was selling just as the market was dipping in the late 80s. If I had gone with the lowest price advised, £145k, I am sure I would have sold quicker at around £140k. Instead I held out, initially at £170k, and ended up taking my company's home equity offer, £132k, in desperation. The house sold eventually for less than £120k. I know that the total hit to the company was around £20k including interest and charges. I always remind my kids of what can happen.
My neighbour is a respected local agent. He makes me chuckle when he tells me stories of how clients tell him what their house is worth and set the price against his advice. He is usually right from seeing what sells in our area. BTW he told me he lost 5 sales in the week after Brexit. People pulling out in fear for their jobs, typically mid-career young family types.
I think estate agents for the main part are rung up from solicitors! Our last house we had three round, one said £225k, another said £280k and gth said £169k! The lady from gth seeing my wife's dissapointment said 'but that's what it's worth'. We sold for £255k!My neighbour is a respected local agent. He makes me chuckle when he tells me stories of how clients tell him what their house is worth and set the price against his advice. He is usually right from seeing what sells in our area. BTW he told me he lost 5 sales in the week after Brexit. People pulling out in fear for their jobs, typically mid-career young family types.
As with all questions about how well or not things are selling, it is all down to the price being asked. Too many sellers have their egos massaged by estate agents who want their business by over-valuing their houses.
My dear old Mum has just sold her house to fund her care home fees and had two offers within a week of it going on the market and has just accepted another offer all within four weeks. It's not at the top end of the market and not exactly in Belgravia either but if there is realism from the seller about the value I believe anything will sell.
My dear old Mum has just sold her house to fund her care home fees and had two offers within a week of it going on the market and has just accepted another offer all within four weeks. It's not at the top end of the market and not exactly in Belgravia either but if there is realism from the seller about the value I believe anything will sell.
Im sure i will get shot down in flames and disagreed with but the bottom end of housing in the north has gone through the roof. Small btl terraces have just gone up 20% plus.
I personally thought the 3% stamp above £40k would have a negative effect but houses are selling quickly,
The top end in the north isnt really moving butbthe bottom end is.
I am trying to figure out why
Pension freedoms has brought more cash to market
Low interest rates for borrowing
Low intest rates puts people off holding cash
10% yield plus capital growth appeals when stockmarket high
People feel tangible property is secure
People in the south realising that in a northern town you can buy a done up terraced home in an area that is safe for £40-50k and get £400-450pm rent. If you club together with your wife/sibling and save hard you can build up a few houses fairly quickly. A lot of southern buyers are buying.
I personally thought the 3% stamp above £40k would have a negative effect but houses are selling quickly,
The top end in the north isnt really moving butbthe bottom end is.
I am trying to figure out why
Pension freedoms has brought more cash to market
Low interest rates for borrowing
Low intest rates puts people off holding cash
10% yield plus capital growth appeals when stockmarket high
People feel tangible property is secure
People in the south realising that in a northern town you can buy a done up terraced home in an area that is safe for £40-50k and get £400-450pm rent. If you club together with your wife/sibling and save hard you can build up a few houses fairly quickly. A lot of southern buyers are buying.
I just had a look at a place we sold in 2014; "prime" west London, W14, and the two comparables to our place are currently on the market are £900-£920 per square foot. We got £990, so I am very glad we sold when we did. And people would have you believe London is a permanently climbing market.
[quote=TR4man]As with all questions about how well or not things are selling, it is all down to the price being asked. Too many sellers have their egos massaged by estate agents who want their business by over-valuing their houses.
My dear old Mum has just sold her house to fund her care home fees and had two offers within a week of it going on the market and has just accepted another offer all within four weeks. It's not at the top end of the market and not exactly in Belgravia either but if there is realism from the seller about the value I believe anything will sell.[/quote?
Surely over valueing a property has a negative effect for the estate agent? For if it doesn't sell they have spent good money trying to sell it and the vendor just thinks they are not doing their job properly, why would they want that?
I am sure some so but if you go with an agent that has a good history of selling then they must be doing something right!
With regards to pricing it right, well that could change from the spring, to the summer, to the winter and we could all price or to sell. ..if it sells to quickly surely it's too cheap?
My dear old Mum has just sold her house to fund her care home fees and had two offers within a week of it going on the market and has just accepted another offer all within four weeks. It's not at the top end of the market and not exactly in Belgravia either but if there is realism from the seller about the value I believe anything will sell.[/quote?
Surely over valueing a property has a negative effect for the estate agent? For if it doesn't sell they have spent good money trying to sell it and the vendor just thinks they are not doing their job properly, why would they want that?
I am sure some so but if you go with an agent that has a good history of selling then they must be doing something right!
With regards to pricing it right, well that could change from the spring, to the summer, to the winter and we could all price or to sell. ..if it sells to quickly surely it's too cheap?
jke11y said:
I just had a look at a place we sold in 2014; "prime" west London, W14, and the two comparables to our place are currently on the market are £900-£920 per square foot. We got £990, so I am very glad we sold when we did. And people would have you believe London is a permanently climbing market.
That was an excellent time to cash out - things were getting approaching the peak at that point.I'm just glad I got out by the skin of my teeth - I had a lot of profit tied up in my 4th development an that would have been wiped out by Brexit.
Nine years of hard work so nearly went up in smoke.
Phew.
AC43 said:
jke11y said:
I just had a look at a place we sold in 2014; "prime" west London, W14, and the two comparables to our place are currently on the market are £900-£920 per square foot. We got £990, so I am very glad we sold when we did. And people would have you believe London is a permanently climbing market.
That was an excellent time to cash out - things were getting approaching the peak at that point.I'm just glad I got out by the skin of my teeth - I had a lot of profit tied up in my 4th development an that would have been wiped out by Brexit.
Nine years of hard work so nearly went up in smoke.
Phew.
jke11y said:
AC43 said:
jke11y said:
I just had a look at a place we sold in 2014; "prime" west London, W14, and the two comparables to our place are currently on the market are £900-£920 per square foot. We got £990, so I am very glad we sold when we did. And people would have you believe London is a permanently climbing market.
That was an excellent time to cash out - things were getting approaching the peak at that point.I'm just glad I got out by the skin of my teeth - I had a lot of profit tied up in my 4th development an that would have been wiped out by Brexit.
Nine years of hard work so nearly went up in smoke.
Phew.
I call the new place my Brexit Bunker.
I downsized a bit but, more to the point, dumped the debt which I'd been using to buy/develop/sell a series of properties.
But, yes, there are a lot of people with their arses hanging right out the window now. Poor feckers.
blade7 said:
What's the chances of a US subprime situation...
I think the banks are much more careful now. I can't see there being much of a problem. Sure, some are over leveraged but it's not like what was happening in the US. I think. The main thing is over leveraged borrowers are much more likely to know they are in a high risk position now. The reason I think this is that I have recently (April) swapped mortgages on my main residence and they ask a lot of questions now. If they're not happy you're not getting the mortgage. Anyone in a vulnerable position will have understanding of the reasons why.I am thinking of moving to Shropshire (Telford probably). Does anyone from that area know how the market is just now? I'm not moving there for work, but it is an area that suits my family's lifestyle. I'm keen to move before the year end, and just need to get idea how to approach and deal with a house that suits.
In the process of selling two houses and buying another;
1st house sold in one week ; second property sold after first day of 6 viewings with 5 offers. Went to final bids and someone offered 20k over asking price and they chose a first time buyer offer on their property to keep chain short and deal attractive. (HP14)
So as for being a buyers market - i don't think so. I've made 75k on a new build flat in 4 years in South Oxfordshire (OX10) . I'm stunned that someone would pay £290k as a first home for a (admittedly large) 2 bedroom flat. But i sold at the price that 2 EA's recommended and was happy with that.
We got 5% off asking for larger house - 1 other couple bidding so could not go lower.
Estate agent told us that houses over £800k or more were really struggling to sell.
As for mortgage offers- got 4 to choose from - was not the spanish inquisition i expected either.
1st house sold in one week ; second property sold after first day of 6 viewings with 5 offers. Went to final bids and someone offered 20k over asking price and they chose a first time buyer offer on their property to keep chain short and deal attractive. (HP14)
So as for being a buyers market - i don't think so. I've made 75k on a new build flat in 4 years in South Oxfordshire (OX10) . I'm stunned that someone would pay £290k as a first home for a (admittedly large) 2 bedroom flat. But i sold at the price that 2 EA's recommended and was happy with that.
We got 5% off asking for larger house - 1 other couple bidding so could not go lower.
Estate agent told us that houses over £800k or more were really struggling to sell.
As for mortgage offers- got 4 to choose from - was not the spanish inquisition i expected either.
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