Saturday, Aug 21, 2010
Erm, try lowering the price?
Daily Mail: Plight of the 1.1million stuck in homes they can't sell
Around 1.1million have tried to move in the last year but have been unable to attract buyers. The study by banking giant Santander found the number of 'failed sellers' was nearly double the number who did succeed in getting a buyer. When asked why they had not been able to sell their home, the most common reason was a failure to find 'a suitable buyer' or 'an acceptable offer'.
Posted by cat and canary @ 02:31 PM (2912 views) Add Comment
28 Comments
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1. estrader said...
"And then my heart with pleasure fills,
And dances with the daffodils."
2. uncle tom said...
Eight out of ten FTB's tapping the BOMAD is a credible stat.
But how many upcoming FTB's have access to significant family funds?
I've not seen any good research on this, but my guess is that fewer than half of potential FTBs have access to such finance.
So they rent, of course; but the supply of property to let is drying up, and rents are soaring as a result. This may well provide a temporary lifeline to the BTL brigade, but it will also start to price out tenants, and contract the overall demand for housing.
Expect some pundits to proclaim a new opportunity for BTL buying; but don't expect much response. BTL people don't look to get rich from rents, they look for capital growth, and only the most rose tinted optimist would bank on that now..
..with luck, we will see the underlying trend for house prices dip steadily now, with the YoY figures going negative before xmas.
My real hope though, is for a mood change in the media, and a focus on the plight of young couples unable to afford anywhere to rent or buy; coupled to a recognition that we need more houses built, - and sooner rather than later..
3. keith thomas said...
If they dropped the price and they'd soon have plenty of buyers.
4. Carol said...
The impact on rents will be affected somewhat by the number of people doubling up -- moving in with friends or family when they can't afford to rent on their own. And probably increasing numbers of adult children not leaving home. I know some of my nieces and nephews continue to live with their parents since they have no job/low paying jobs. Add the elders who will have to move back in with their children and rents will not increase as much as some might expect.
Forecasters get into trouble by assuming that people won't change their behaviour in response to a changing situation.
5. mark wadsworth said...
C&C, exactly. I have read the whole article and not once does it even hint that prices may be far too high. But on Planet Home-Owner-Ist, house prices are an absolute and fixed figure which is whatever it was last year plus five or ten per cent.
UT, there have always been the occasional stories about young couples who can't afford to buy a home or who have been on a council house waiting list for years. The Home-Owner-Ists just don't care. And not one square inch of The Hallowed Greenbelt may be sacrificed for today's fekcless generation who want everything financed by debt and they want it now!
6. titaniccaptain said...
I lowered my asking price to one which someone could afford from one that the estate agent said it was valued at....and I sold...the bloke I bought my new house off did the same and lowered his asking price to one which was affordable .....So I sold, moved and bought......but neither of us were in negative equity.......
7. brickormortis said...
TC - Absolutely right. it doesn't matter what you sell it for unless your trading down. If your trading up then your quids in if the market falls. Unless all 1 million (where did they get that number from) wanted to trade down!
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9. gone-to-colombia said...
TC - absolutely, we need a shift in understanding.
Thanks for you offer about Wales, I'm still looking, but still here in the Caribbean.
10. clockslinger said...
I have every sympathy as I had the same problem running my high class newsagency selling traditional "Sherbert Fountains" and "Black Jacks" chewing confectionary at two quid each and fine English "newspapers" such as The Times and The Telegraph at three pounds per organ. The Official Reciever still can't understand my firm belief in top quality prices for traditional products sold in a convenient location, and I can't understand how Mr Patel who took over the shop makes ends meet.
11. Keith said...
One of the problems is that people who bought in the last 5 years (at the bottom of the so called ladder) can't afford to sell even at a 10% discount.
The HIP ladder was taken away some years back and now people want to move. With no new entrants into the market they are now stuck.
It will take forced selles for the prices to drop, with low base rate that is not going to happen soon. unless the cutbacks have a profound efffect.
12. crash bandicoot said...
Regulars will have heard this story before but I'll repeat it again,
There was a plan to build a major international airport - the size of Heathrow - down the road from me, between Rugby and Coventry. It became the subject of a local television documentary. There were several interviews with local people who were either going to loose their home to a CPO or would be under the flight path. In one interview a woman was asked "has this uncertainty affected house prices in the area?" She replied "No, house prices remain unchanged" ................... "It's just that none are selling at the moment".
This is a microchosm of the country at the moment. The easily won gains we be relinquished reluctantly.
13. peter said...
Yeah, lower the price. It is a simple enough concept.
But the trouble is that if there are enough people with daft ideas, like expecting prices never to fall, the govmint will surely pander to them.
Look out for a bit more money printing from the BofE to try and help these idiots out. But watch out, it will end with a bang.
14. Jonboy2010 said...
people just dont want to face the reality that the party is over.
15. Cypher007 said...
@uncle tom the problem is not so much a need for more housing but a need for lees people. dont forget we have had a huge influx of foreign nationals that also need somewhere to live. i think in part this is why house prices have not fallen as much as other areas of the EU. its also in part the reason why blt's helped drive prices up.
16. mr messy said...
people are refusing to drop their prices to a realistic level, so many people selling by me are either being over optimistic or are being given incorrect valuations by the estate agents who i have challenged on many occasions ,only to be told that is what the vendor wants for the asking price not what we have valued it at !!!!!!!!!!!!!, bring on an interest rate rise that is the only thing that is going to bring prices down
17. Cypher007 said...
@all lowering the price is all well and good if your an str, but if your in a property and want to move up the ladder, there not much you can do about the price as you still need X to add to your saving to buy Y, and if Y wont drop there price then it becomes a game of, who will blink first.
18. Panda said...
The circus was brought to a grinding halt by international markets and will be brought down again. In England, there is a happy consensus which is quite insane, and the entitlement culture that is documented in another article this morning weighs heavily on all of this. There really is no way out. Inflation is rising, and will rise heavily, and foreign lenders will raise interest rates to suit. Why?
Because the purchasing power of our currency is less than it was..
You can't shift that one out.
19. a saver said...
Guess it wouldn't be surprising if people were holding on to houses expecting that the government will do something to stimulate the market. They certainly did in 2008, so anyone holding a house as an investment has had ample chance to get out. I am hoping that the current gov have a bit more integrity than their predecessors.
20. peter said...
@ a saver
Don't fool youself.
Just when you think politics coldn't sink any lower...it sinks a bit lower.
21. Fingerbob69 said...
11. mr messy said...people are refusing to drop their prices to a realistic level, so many people selling by me are either being over optimistic or are being given incorrect valuations by the estate agents who i have challenged on many occasions ,only to be told that is what the vendor wants for the asking price not what we have valued it at !!!!!!!!!!!!!, bring on an interest rate rise that is the only thing that is going to bring prices down
Why all the explanation marks? That is what is happening. With one or two exceptions most property I have taken on recently (I'm an EA in Ipswich) is on at a price that is 10-20% more than I valued it at because that's what the vendor wants.
One property I valued this week the Vendor wants it on for £180k. With one exception in October 2007 no property in that postcode has ever sold for more than £165k.
Blame 'greedy' EAs all you like but actually while you ordinary people,vendors, refuse to take the advice you pay for then expect not to sell, expect asking prices to stagnate while actual values continue to fall.
22. cat and canary said...
oh dear, if (as the article suggest) that a huge number of sellers stubbornly wont drop the price and accept the new reality... then they presumably have a lot of "wealth" tied up in their houses.
As the austerity axe starts to fall, and inflation eats away disposable income, then surely what once seemed like a perfect investment, that could only go up in value (or Kirsty will eat her hat), suddenly becomes a ball and chain for years to come?
How can you negotiate higher salaries in new locations, or find a new job, if you cant sell your house at the value you think its worth? They should accept their loss of wealth now, or cut their nose off to spite their face.
23. sureseam said...
There is a distinction between "won't sell" {won't drop the price} and "can't sell" {'cos we would have to pay the negative equity}.
That said sheeply Brits regard houses as wealth in the way that some Africans measure their wealth in goats; or goldbugs measure their wealth in troy ounces of gold. The notion that there might not be a stampede of buyers offering mere money for their precious house is a bit of a shock after the last few decades.
Once the disillusionment sets in - it will be deep and prices could go lower than most imagine {in real terms of course}.
24. Squirrel_and-g-man said...
I'm not sure how much prices will drop even in real terms, as when inflation starts to take hold anyone with 'cash' with want their wealth in 'assets' such as property.
Time will tell of course, and i do hope i've very wrong.
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