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Those Who Will Not Face Reality ....


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This is the first time I have used this forum but I am sure this is a situation that other people will have encountered.

I have inherited a half share in a house, another relative owns the other share. The house was valued by an agent at £229,950 and is now on the market at that advertised price, since February. Since then there has been one viewing and no offers. I spoke to the agent this morning who told me this is a pricing issue and in the current market it should be marketed as "Offers over £199,000".

I know house prices have dropped, how to I convince my relative of this when he says "House prices will bounce back in a few months when banks start lending again"? He won't face the new reality. He thinks the agent just wants q quick sale at a low price to get the commission. Is there any material I can show him that explains the new reality>

Anybody successfully handled this?

Thanks

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Ask your relative to explain the reasons why banks will suddenly start lending to all and sundry at low rates, with self-cert, and no deposits again.

Unfortunately my relative is not in a position to buy my share, the person already has a house. He has been told by his friends that this recovery is coming soon.

Has anyone actually handled this situation?

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This is the first time I have used this forum but I am sure this is a situation that other people will have encountered.

I have inherited a half share in a house, another relative owns the other share. The house was valued by an agent at £229,950 and is now on the market at that advertised price, since February. Since then there has been one viewing and no offers. I spoke to the agent this morning who told me this is a pricing issue and in the current market it should be marketed as "Offers over £199,000".

I know house prices have dropped, how to I convince my relative of this when he says "House prices will bounce back in a few months when banks start lending again"? He won't face the new reality. He thinks the agent just wants q quick sale at a low price to get the commission. Is there any material I can show him that explains the new reality>

Anybody successfully handled this?

Thanks

Had a similar problem with the sale of my mothers flat. Perhaps the situation is a little different as we werent inherinting it. However my brothers and I were managing the sale as mum is not able to cope with all of that stuff. The flat went on sale last August at a ludicrously inflated price of £230K - I tried pointing this out to my brother but he simply wouldnt listen. We spent the next six months chasing the market down, again with me trying to persuade my brother to see reality, to little avail. I suggested we needed to get ahead of the curve but he wouldnt be persuaded. Finally in March the agent advised us to cut the price to £160 K.- my brother reluctanly gave in. We then got an offer of £149K, we accepted and it seems to be going through.

When we finally got the offer my brother mocked my ability to read the market - even after I had told him the market was going to fall back in 2006. I sent him lots of data and facts but it made no difference - he would simply not believe what he didnt want to hear and I think that is your real problem - infact I think that problem is widespread - people wont believe what they dont want to believe - I suppose that is the essence of denial.

Anyway good luck.

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Unfortunately my relative is not in a position to buy my share, the person already has a house. He has been told by his friends that this recovery is coming soon.

Has anyone actually handled this situation?

No, but I've often thought about it. I would probably have no choice but to keep badgering him into reality, presenting more and more evidence as to why a miracle bounce is not about to occur.

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not alot you can do if they refuse to sell lower and dont have the money to buy you out. In the interest of family harmony, in your position if you wanted as neutral a position as possible i would open an account with IG and short the Halifax Price index and keep rolling it forward , the costs would be relatively small to the potential saving although clearly depending on property type and area it wont be exactly neutral

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not alot you can do if they refuse to sell lower and dont have the money to buy you out.

You can negotiate a charge over the property in your favour of say £100,000 in return for signing over 100% ownership.

If the other party really believes that the house will sell for substantially more than £200,000 then the offer is attractive.

If it eventually sells for £150,000 then you will get £100,000 and he will get £50,000.

If it sells for £250,000 you still get £100,000 and he gets £150,000.

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The Spaniard's charge looks good, though if it takes a long time to sell (as seems likely) then inflation will do its damage to your £100k.

It seems surprising that your relative cannot buy your share though. I would have thought many banks would be happy to lend on near 50% LTV ratio as they can't really lose.

Maybe take your relative to a mortgage broker to see what deals they can get. That would mean you walk away with over £100k now, which seems best.

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You can negotiate a charge over the property in your favour of say £100,000 in return for signing over 100% ownership.

If the other party really believes that the house will sell for substantially more than £200,000 then the offer is attractive.

If it eventually sells for £150,000 then you will get £100,000 and he will get £50,000.

If it sells for £250,000 you still get £100,000 and he gets £150,000.

like i say thats a sure way to destroy family harmony as money often does, it depends how close this family member was but if close it would defiinitely not be my choice of solution

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like i say thats a sure way to destroy family harmony as money often does, it depends how close this family member was but if close it would defiinitely not be my choice of solution

Tell me about it, having just inherited a property in France, which I'm not even being allowed access to.

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This is the first time I have used this forum but I am sure this is a situation that other people will have encountered.

I have inherited a half share in a house, another relative owns the other share. The house was valued by an agent at £229,950 and is now on the market at that advertised price, since February. Since then there has been one viewing and no offers. I spoke to the agent this morning who told me this is a pricing issue and in the current market it should be marketed as "Offers over £199,000".

I know house prices have dropped, how to I convince my relative of this when he says "House prices will bounce back in a few months when banks start lending again"? He won't face the new reality. He thinks the agent just wants q quick sale at a low price to get the commission. Is there any material I can show him that explains the new reality>

Anybody successfully handled this?

Thanks

Personally, I wouldn't try to convince him - it'll be an almost impossible task. I would, though, write to him reiterating your recommendation that you both - assuming you are joint executors - not ignore professional advice you've been offered. As executors, you have a duty to act in the best interest of the estate (and other beneficiaries, if there are any) and not to make personal 'guesstimates' of what the value of one of its main assets will be at a future date. It is not your job as executors to play the property market but to dispose of the assets sensibly and distribute the funds. If he is dissatisfied with the advice given by this one professional, then I would suggest that you organise other free valuations.

If you decide to try and convince him of your case, then you need to collect overwhelming credible information because you, too, need to show that you are acting in a reasonable fashion. In addition to the professional advice you've already received, there's now lots of data you can collect. Scan through the postings on this site for the comments of people like the spokespersons for CML, Nationwide, Halifax, BoE lending estimates etc. etc. and find the original sources before presenting them to him in a businesslike way. Your personal view of the market is immaterial unless backed up by credible comments.

Good luck: you'll need it.

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like i say thats a sure way to destroy family harmony as money often does, it depends how close this family member was but if close it would defiinitely not be my choice of solution

This other family member is currently destroying harmony with his refusal to listen to advice. Could end up costing the OP a lot of hassle and money. Imagine if he has to chase the market down for the next year, could cost many thousands and anything can happen to the house such as squatters.

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This is the first time I have used this forum but I am sure this is a situation that other people will have encountered.

I have inherited a half share in a house, another relative owns the other share. The house was valued by an agent at £229,950 and is now on the market at that advertised price, since February. Since then there has been one viewing and no offers. I spoke to the agent this morning who told me this is a pricing issue and in the current market it should be marketed as "Offers over £199,000".

I know house prices have dropped, how to I convince my relative of this when he says "House prices will bounce back in a few months when banks start lending again"? He won't face the new reality. He thinks the agent just wants q quick sale at a low price to get the commission. Is there any material I can show him that explains the new reality>

Anybody successfully handled this?

Thanks

simple. the type of buyer able to buy at that price ie 220k+ will not need for banks to start lending at higher LTV's. A flood of 90% or 95% LTV mortgage products will not make his property any more desirable at 200k+ for either a prospective buyer or a btl investor, and it won't open up his property to a greater number of realistic buyers in the market. Infact, through most of the dacade i believe the average deposit for a ftb has been well over 10% of purchase price, a reduction in the deposit reqt. from banks won't result in a stampede of enquiries. change of sentiment is more what your relative seems to be holding out for.....good luck with that one. if the current sentiment beds down and expectations of further price falls continue into next year, then you may have to wait it out and extented period.

the agent, btw i believe is wrong, i personally don't like it when houses are offered at 'offers over', price it correctly and it will sell. and tell the EA not to be cute with 'offers over' pricing strategy. Either you and the relative want to parcipitate in the market, don't go wasting EA window space by pricing the property incorrectly. If you want to wait it out and sell later, take it off the market ffs, and be prepared to wait for hell to freeze over. alternatively you could find an agent who's so desperate to devote window space to your inheritance, that he/she will tell you anything you want to hear.

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Your personal view of the market is immaterial unless backed up by credible comments.

Good luck: you'll need it.

Hang on a minute - why does party a's insistence on hanging out carry more weight than party b's wish to sell quickly.

Sounds like party a is a bit of a bully to me.

Absolutely I would go for the £100k fixed charge - or 90/95 or whatever. I'd rather have the cash than preserve the relationship - maybe not an only sibling. Other than that, screw them.

The irony is that in a rising market the 'relative' would probably try to sell really quickly to 'cash in' when they should be holding on to ride the bull market.

Most people don't understand markets sadly.

(Or happily if it means you can relieve them of their cash :P ).

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Unfortunately my relative is not in a position to buy my share, the person already has a house. He has been told by his friends that this recovery is coming soon.

Has anyone actually handled this situation?

I bought a BTL with my brother for £21k for my uncle to live in.My uncle died and my brother wanted to let the house.It was last Spring.I told him the market was in for a crash and we should sell.

It went up for £121k and we got an offer for £106 from a FTB.My brother said it was too low and we should wait :o .In the end it took a blazing row,where i laid it straight,and he accepted.

A house over the road has just sold for £62k.Carbon copy and my brother now says good job we BOTH decided to take that offer.Its always a very tricky situation.Maybe agree to a timescale.If it hasnt sold in 4 weeks we lower the price.Perhaps also you need to get them to read HPC for a few days.That should seal the deal for you :lol: .

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The bigger the boom, the bigger the delusion?

Seems that way anyhoo.

I think you are right.

Talking to people even now about the future of the economy/house prices and it is amazing how deluded they are. Now is great time to buy, crash is over etc

It's a bit like talking to a suicide bomber with his finger on the trigger and saying 'have you considered Buddhism?'

Edited by D.C.
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