Friday, Jan 09, 2009
Denial!, Denial!, Denial!
Findaproperty: 2 bedroom apartment for sale
I just thought I'd post this to remind us all that many vendors and EA's are still in denial. Flats in this block were selling in 2003-4 for 187K-197K, but the vendors want 285K, even though Finoulla at Nationwide has said that average prices are now down to 2004 levels. FYI.
Posted by bystander @ 03:21 PM (1069 views) Add Comment
19 Comments
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1. it_is_going_with_a_bang said...
What a miserable flat. 285k lol. Its worth half that.
2. montesquieu said...
I'm in strenuous conversation with the wife today, wants us to get back in the market.
Plan is to buy a flat near where she works, save another deposit and the buy a second house back in Somerset (we are renting in Berks at the moment) where we'll go for the half of the year she doesn't need to be near London.
Flat she wants 10min walking distance to her university dept, has been on since sept at £229, down this week to £195. Market peaked in the street at £267 in July 07 according to nethousprices (for nice but small 2-bed terrace just inside Surrey).
She wants us to offer £160k (which will be rejected I'm sure). I think it's a low of ££125-130k in a couple of years though prices will always get some support because 10,000 students and a lot of younger staff also have the same need to be in walking distance and Surrey will never get all that cheap.
Our total budget is £400k (at multiple of main salary x3 plus second salary x1) so that would only give us £250k left to buy the 'dream' house in Somerset - not enough even post crash, I fear.
Issue is - as you point out - a lot of places like these flats are still at high prices, even if they have fallen quite a bit from fantasyland numbers.
How do I persuade her to wait? She loves this place not least for its proximity to work and is worried another won't come along when we want it.
3. rm96696 said...
Looks like a dump. Guess it will be on the market for a long time (20-25 years?). More pent up supply...
4. justwatching said...
montesquieu, who wears the trousers??
put your foot down.
Only kidding, but I do remember an article of 6-12 months back about how some properties were being bought due to the hearts of the females in relationships/marriages. I've got a friend who made the mistake of listening to the misses, they bought in may 08, there was no need to, apart from 'she fell in love with the place'.
I caught myself eyeing up a property here, Dorset/Somerset border. It's been on for a while (oct 07), dropped from 310k to 230k, it would be ideal for our family. No, no, must.....not ...phone.....Connells........Must.....wait ....wait.....wait...
Phew that was close.
Haliwide = 110k average, I'm in.
5. Shipbuilder said...
montesquieu, the idea of only one or two properties in an area being an 'unmissable' bargain, is buying into EA rhetoric. The bottom is reached and 'normality' returns when there is a choice of properties at the new, reasonable level. Until we reach that point I wouldn't buy. Where there is one there will be others soon, cheaper. I've been following the market here in NI, and i've seen it many times.
Example - in East Belfast, 3 bed semis with garden and garage were £280K at peak. A while ago one or two were on for as low as £175-180K they looked like bargains, but now there are dozens for less, only months later.
6. need-a-crash said...
@4. justwatching
...but when Haliwide are at 110k what will the actual asking prices be? As this article points out the crash is happening so quickly I think many vendors are assuming it'll rise again as quickly as it's currently falling.
Quite a few friends of mine believe (mistakenly) that 3-6 months from now is the time to buy as prices will rise again in 2010. If buyers are parpared to believe this then vendors probably do as well.
7. shipbuilder said...
Need-a-crash, this is because we are still in the denial stage and the new reality has not been accepted. It will be.
8. gone-to-colombia said...
The graph that used to be on the home page always seems to convince most I show it to.
9. Vivaldo said...
Montesquieu.
Persuade the wife to hold on ... if you can.
If needs be she could rent a flat near to her work ... there shouldn't be any shortage right now!
10. wally said...
mq, jw - my missus wants to buy a house to be near her mum. North Devon, great for surfing so very tempting.
I had my fingers burned in the last crash so I am very cautious. But at what point do you jump in? 4 months back had an offer of 135K rejected (against 170K). The property is now sold and the missus goes on about it still. But if things carry on then properties like this are going to be well under 100K. So did I save 35k+ or will this type of property never be available again?
11. str 2007 said...
montesquieu
If you must buy the cheapest of the 2 now (if you get it for £160k that's 30% off peak asking) and of course you won't be renting.
Then get the other when you can afford it. That way you've hedged your bets, covered necessity and have something to look forward to.
And if things change, you're more likely to be able to rent out something close to a college. (Englefield Green by any chance)?
12. P. O. O. R. said...
Have just purchased after renting for the last couple of years. I know prices may drop another 10%, however the property just purchased ticked all the right boxes and was bought for 25% less than it originally came on market last spring. Also for a house that needs a lot of renovating now is a good time to buy. Builders, and shops falling over themselves to try and get the business. So I believe now is a good time to buy, but don't expect any gains in value over the next couple of years.
13. str 2007 said...
Wally
Even the vested interests admit it's going to fall this year, (oh no they're always wrong) just joking. You have to way up your own circumstances in all this.
If you want a family do not get yourself trapped in a flat.
If you assume prices will fall another 20-30% and the recovery to where prices are now will take 10 years then I don't think you'll be far off.
Assuming you find a place you like and are unlikely to need to move (children etc) over the next 10 years and you can comfortably afford it then go for it and be happy.
But do not overstretch at the moment IMO.
14. Amy said...
montesquieu:
I am in the reverse situation, I'm the misses and my husband is anxious to buy. A buy rent calculator may help, if she sees how much you're saving by renting in a falling market. I like this one:
http://www.nytimes.com/2007/04/10/business/2007_BUYRENT_GRAPHIC.html
15. little professor said...
This 1 bed in the same block has been reduced £254k to £225k and now down to £200k. Still hasn't sold. Can't think why - wouldn't you want to spend quarter of a million pounds for a shoebox like this?
16. justwatching said...
Wally, think about the money you are saving, about 3K per month on current 2%ish falls.
How about renting in North Devon?
I'm looking at the following, and waiting for trends to turn;
Home page, wait for graph to flatten.
Mortgage data, we're way below average at present in terms of approvals and average value of loan approved.
RICS survey
Unemployment data?
17. nubbers said...
montesquieu, I have had the same problem twice. Once in 1990 and again now. Last time I gave in. We split up a year later anyway and I had 10 years of paying off of a huge amount of negative equity. Just hold out another year at least.
18. montesquieu said...
@str 2007
Englefield Green indeed. I think I won this one for now but she is of a generation that owning property is the only route to financial security so she's uncomfortable renting.
We did look to rent in the area but only saw overpriced rubbish. So we ended up 20mins down the line towards Reading, walking distance from the train station.
19. str 2007 said...
Montesquieu
Keep us posted on progress