Saturday, May 09, 2009
Blatant FT property ramping using selective statistics
FT: Slump in UK homes up for sale
This front page headline article claims that there is a large drop in property on offer for sale over the past year - typically around 25% - without once mentioning that most of the property that is no longer on offer was priced completely unrealistically, and thus could be said not to have been on offer to begin with. The fact that prices are still falling is not considered a sign that supply at reasonably saleable prices still exceeds demand.
Posted by mark @ 11:05 AM (705 views) Add Comment
8 Comments
- If you do not have an admin password leave the password field blank.
- If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
- Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
- Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
- Please adhere to the Guidelines
1. tyrellcorporation said...
Anecdotally, there has been a marked reduction of properties on sale in Exeter. I noticed a surge after Christmas and they have all but cleared either through being bought, taken off the market or rented out. The last month I'd say for sale boards have dropped by 50% or more.Rather than this being a fillip to support prices (through reduced supply) I reckon EAs will be squealing as turnover dries up; many will go to the wall. Those that remain will be desperately trying to get vendors to drop prices. The housing market dynamic has changed a lot in the last month or so IMO.
2. mark wadsworth said...
Ah diddums, is all I can say - properties for sale may be down 25% but properties being sold are down more than 50%.
What's with the FT's closing shot that prices are down to levels of 3 years ago? Don't they mean 5?
EA's really ought to get with the plot and advise vendors to pitch the price at whatever it was 5 years ago minus ten per cent in order to get their commission.
3. dbc reed said...
In Northampton, there has been a marked reduction in estate agents' For Sale boards in the last couple of months.Maybe EA's are trying Mark W's approach to would-be vendors already: and vendors are saying in that case, we'll not sell.Something is going on.
4. Screamifyouwanttogofaster said...
This is good. It means more owners have now got the message that their property really isn't worth what it was anymore. So Denial is over and we're into Anger ("right, I jolly well won't sell it then"). Only Bargaining and Depression to go before we finally arrive at Acceptance...
That said, my property-for-sale email updates today have more than 3 times the number of properties I've seen for most of this year... don't know what's going on there...
5. enuii said...
Having read the article it fails to make the distinction between new builds and pre-owned properties, a good percentage of EA listings were previously for new builds from small to medium sized developers. Their business has evaporated as it became unsustainable and this has merely cascaded through to Estate Agents books. As Mark says this is the selective use of statistics to create a story.
6. Mark said...
Perhaps I should have mentioned that the stock of property on sale currently is more than twice that at the peak of the boom according to a search I have run regularly since about 2006. I've also seen some properties that were withdrawn over the past few months reappearing to try to catch the dead cat bounce. Another factor that hasn't been mentioned is the effect of HIPS expiring after 12 months, or the impact of the new requirement since April 9th that a HIP be in place prior to marketing - which is bound to have caused a backlog in property listings.
7. mander said...
More information from estate agents...
Probably sellers think that prices will rise again soon and preffer to wait although the so called green shots should have brought some sellers to the market.
But prices are 30-40% over the acceptable and credit worthy buyers will not step in. Unless banks lend to investors only we do not see how the market will get back to normal.
There is a lot of unsold stock on the Rightmove, properties spend even 2 years there.
8. stillthinking said...
There must be a lot of people who can't sell because of negative equity, and have no choice but to hang on. If your BTL is secured on your main asset, the family home, then selling transfers the loss and perhaps gives you less choice of mortgage finance.
Truly it is a strange dynamic because all the time the market is frozen the economy worsens, and the market freezes more. There will always be a base level of rent available, from the DSS if necessary. How long can speculators hang on for, topping up rental income every month? Probably a long time considering the alternative is a foreclosure against the family property.
Employment levels and rents ultimately drive prices so watch where they go.