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pajd

Estate Agents Or Sellers?

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I just had a look on propertypal at some houses in my home city which are over my budget.

Im actually shocked that people still expect these prices! I checked the stats on propertypal and a lot are still listed from 2007!

Now this brings me to my point. Who is actually setting the price? It couldn't be estate agents could it? Afterall not much is selling and do they not get a certain percentage of the sale value? 10 sales at a lower price is better than 1 sale at a high price.

Is it the vendor who is setting the price and refusing to budge? Do they think for one moment that in these days when a UK double dip recession is likely, when the NI economy is still going downward, when unemployment is still rising, job uncertainty still lingers,wages are static, massive cuts are just around the corner and banks are not lending (and probably never will lend like they did before)....do these people actually think they can get peak prices for their houses? Or are people still stupid enough to part with their money and buy at these prices?

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I imagine that sellers are holding out for the 2007 price. I see the same thing happening with all the new builds near where I work also. Developers and sellers are deluded. I don't expect this to change any time soon with ultra low interest rates. Wait until these rise then there will be a rush to lower prices. But I do think it is some sort of collective mental illness.

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Alot of the 32,000 or so, properties listed on Property News have been there from 2007 and before. Are they really for sale at all? There is a war going on between Property News and Property Pal, to who is the largest and therefore Property News are reluctant to remove the older 'forgotten' stock. I know , on our own developments we have to go back to them to get the houses we have sold taken down.

Therefore we cant assume that the houses listed at 'boom prices' are really on at that level at all. If they are recent listings then that is a different story.

2buyornot2buy: I have to challenge you on this perception that mortgage rates or availability is in some way contributing to increased sales or holding sales. First of all the average mortgage is not at 'ultra low interest rates'. Whilst the BOI rate is ultra low at 0.5% this is in no way reflected in the products available to the average purchaser. If you have a loan to value of 60% or less you may be able to lock into a 4% 5 year fix. But for most at the 85% to 90% Loan to Value the rate is closer to 5% and above. I would guess that this rate is close to the average rate over the last 15 years. Secondly the higher deposit requirement (some of which I agree with) is making the purchase of houses more difficult. Thirdly the lenders, as they have to keep the loans on their books are extremely careful about who they lend money to (again most of which I actually welcome). Therefore the current mortgage situation is in no way 'propping up or sustaining prices in any way. Whilst it has improved I believe it needs to improve more. i.e HSBC for some reason will only lend 85% on Newbuild but will give you 95% on the same house if it, for example has been rented out for 6 mths. Go figure.

As for the 'collective mental illness', without it we would never have survived.

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Sorry vi I was talking about sellers who might otherwise have to sell won't because rates are low and they have reverted to base + x lifetime tracker products. Like you say in a lot of cases this fantastic rate would not be available if they tried to refinance now, so I imagine they are staying put because they can only afford the property while rates stay at these historic lows. I personally know lots of people like this. I also now lots with btl that can now only afford the places because of these rates. And were banking on cap gains

Not to mention the people on government support for mortages.

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Alot of the 32,000 or so, properties listed on Property News have been there from 2007 and before. Are they really for sale at all? There is a war going on between Property News and Property Pal, to who is the largest and therefore Property News are reluctant to remove the older 'forgotten' stock. I know , on our own developments we have to go back to them to get the houses we have sold taken down.

The ones i looked at are also listed on estate agent websites

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Sorry vi I was talking about sellers who might otherwise have to sell won't because rates are low and they have reverted to base + x lifetime tracker products. Like you say in a lot of cases this fantastic rate would not be available if they tried to refinance now, so I imagine they are staying put because they can only afford the property while rates stay at these historic lows. I personally know lots of people like this. I also now lots with btl that can now only afford the places because of these rates. And were banking on cap gains

Not to mention the people on government support for mortages.

point taken

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I don't think it is much to do with the interest rates anyway. The problem, I think, is that the banks are not foreclosing, they are holding onto a large number of properties at a high book value and listing them for sale at that price. I have seen specific examples of houses on sale for 2 years or more. It seems to be a voluntary repossession thing, where the bank agree you don't pay the mortgage and they then sell it for you to recover the money. These are also people who don't count themselves as in Negative equity, and the banks doesn't want to admit it either, if they could sell now they might break even or with a small loss, but the longer they wait the bigger the deficit they will owe the bank.

These are the forced sales that should have corrected the market, but havn't because banks are being allowed to count them as assets. Something which no other business would be allowed to do for 2 year old stock.

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I know several ppl who have had their houses for sale for 2yrs + ... as does most ppl on these forums probably! I think most sellers realise that their house is no longer worth what it was originally up for in 2007, and some will have made some small adjustments. But most will not have reduced the price in line with the 40% drops that we have seen in some areas. Easier to apply the 'bury head in sand' theory.

Now what is the reason for this??? ... prob different reasons depending on the individual but for the most part I would agree with the point made ... is the house still really for sale? It may very well have a sign up but most of these sellers will have prob adopted the sign as part of the furniture by now and just continue on with every day life in the hope that some day the phone rings and somebody offers them the £200k+ that it is up for. Some will be reluctant to take it down because they may have to pay fee's to an estate agent as a result of doing so.

Some sellers will fall into the category of complete ignorance and will have convinced themselves, and prob attempted to convince everyone they know that the houses arnt selling simply because the Banks wont lend the money. They have prob convinced themselves that once the Banks start lending again :ph34r: that there will be an influx of potential buyers. I think we can classify these ppl as deluded. Who was the crazy one, the person who asked for the loan or the person who gave them it. I will leave it to them to fight it out together in the retirement funny farm.

Recently there has been an increase in the number of properties for sale, but there is no demand for them at current prices. This is were I personally see a big correction in terms of mindsets. I have no doubt that there are potential buyers out there who prob would buy at todays prices only they are finding it hard to get a loan, but in all reality I dont see this as being the main reason for transactions not taking place. The sentiment isnt there at the minute to buy ... the main reason for this has to be prices. Generally a 'lets just wait and see' approach has been adopted and there are a lot of potential buyers attempting to time what they see as the 'bottom of the market'.

If you bought in the last 3-5 years you may well have no choice but to put your property on at a higher value than what it is worth due to negative equity and hope. Foolish to do this in the current market but there is nothing as 'Queer as Folk' sometimes.

Should also bear in mind that 1 in 3 marriages end in divorce so a parting of ways could be forcing sales etc! Point being that there can be many variables/factors as to why someone puts there house up for sale, not everyone is in negative equity after all.

Houses that have been put on the market in the last year or so have been overvalued for the most part by the Estate Agents. Dont want to tar them all with the same brush but in my own (recent) experience of them they talk the biggest load of bullswax at times. But then that is there job.

Human nature is prob lastly to blame and greed. If I told you as a buyer that your house was increasing by £1000 a day you would shout that from the roof tops. If I told you it was dropping by £1000 per day you would prob punch me on the face.

Human nature ... greed .... God loves crazy people.

Estate Agents or Sellers ... hmmmm. Both still pretty much deluded! :rolleyes::unsure::blink:

Edited by tinbin

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I know several ppl who have had their houses for sale for 2yrs + ... as does most ppl on these forums probably! I think most sellers realise that their house is no longer worth what it was originally up for in 2007, and some will have made some small adjustments. But most will not have reduced the price in line with the 40% drops that we have seen in some areas. Easier to apply the 'bury head in sand' theory.

Now what is the reason for this??? ... prob different reasons depending on the individual but for the most part I would agree with the point made ... is the house still really for sale? It may very well have a sign up but most of these sellers will have prob adopted the sign as part of the furniture by now and just continue on with every day life in the hope that some day the phone rings and somebody offers them the £200k+ that it is up for. Some will be reluctant to take it down because they may have to pay fee's to an estate agent as a result of doing so.

Some sellers will fall into the category of complete ignorance and will have convinced themselves, and prob attempted to convince everyone they know that the houses arnt selling simply because the Banks wont lend the money. They have prob convinced themselves that once the Banks start lending again :ph34r: that there will be an influx of potential buyers. I think we can classify these ppl as deluded. Who was the crazy one, the person who asked for the loan or the person who gave them it. I will leave it to them to fight it out together in the retirement funny farm.

Recently there has been an increase in the number of properties for sale, but there is no demand for them at current prices. This is were I personally see a big correction in terms of mindsets. I have no doubt that there are potential buyers out there who prob would buy at todays prices only they are finding it hard to get a loan, but in all reality I dont see this as being the main reason for transactions not taking place. The sentiment isnt there at the minute to buy ... the main reason for this has to be prices. Generally a 'lets just wait and see' approach has been adopted and there are a lot of potential buyers attempting to time what they see as the 'bottom of the market'.

If you bought in the last 3-5 years you may well have no choice but to put your property on at a higher value than what it is worth due to negative equity and hope. Foolish to do this in the current market but there is nothing as 'Queer as Folk' sometimes.

Should also bear in mind that 1 in 3 marriages end in divorce so a parting of ways could be forcing sales etc! Point being that there can be many variables/factors as to why someone puts there house up for sale, not everyone is in negative equity after all.

Houses that have been put on the market in the last year or so have been overvalued for the most part by the Estate Agents. Dont want to tar them all with the same brush but in my own (recent) experience of them they talk the biggest load of bullswax at times. But then that is there job.

Human nature is prob lastly to blame and greed. If I told you as a buyer that your house was increasing by £1000 a day you would shout that from the roof tops. If I told you it was dropping by £1000 per day you would prob punch me on the face.

Human nature ... greed .... God loves crazy people.

Estate Agents or Sellers ... hmmmm. Both still pretty much deluded! :rolleyes::unsure::blink:

Great post

However I personally believe the sentiment issue has more to do with lack of job security and lack of confidence generally than price.

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Agents would be crazy in the present market to list stock at unrealistic prices .. What is the benefit? Why would they do viewings /handle enquiries on houses with no chance of selling. Houses are selling at present, as long as the price is todays price and is realistic. Switched on agents will not accept an instruction at a silly .

On the repo front ,there are plenty of repos being sold at present , again at whatever they make in todays market.

prices are still falling,albeit more slowly. Some of the current buyers know that prices may still fall, but they want to own rather than rent and have got fed up waiting over the last two or three years.

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I'm new to the forum, so please bear with me if I'm not quite up to speed yet. I watched a BBC programme several months ago when one prominent Belfast agent asserted that we were back to 2005 levels: if this is the case, surely we should be seeing many more properties at rateable value? I've also read comments on the site about rateable value, but when I check out most of the re-sales in my area, they are still significantly above this level (around 1.6 times, sometimes more). There is still clearly a huge divergence between what sellers and estate agents think can be achieved and what the market will/can support. Would-be buyers are constrained either by a lack of bank finance (does the world really want banks to go back to the hugely irresponsible lending of the pre-Lehman era?) or, even if they can obtain the finance, by the knowledge that we are entering a new economic reality. However, vendors and/or their agents do not seem to have come to terms with this yet. Are they perhaps on a different planet to the rest of us on the eve of the Spending Review?

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Hello and welcome to the site. I can only agree about the prices being sought by estate agents being unrealistic in today's climate. You were right about the EA from Templeton Robinson saying prices achieved are back to early 2005 levels although I doubt you will find many houses on their website at that level in asking price.

Tonight I was doing my usual search through all recently added on propertynews and I was surprised at the number of houses which are now coming into a price range that I would view as affordable.

Most of these seem empty and may be repos - interesting if we do get more coming on the market to bring down the prices of the other houses round about them.

Oh joy! To think that TR are coming to a town near me soon - Jan 2011 if the article you referenced the other day was correct!

I would not wish repossession on anyone, but I do wish that those who are not prepared to accept today's price would remove themselves and their properties from the market. After all, an asset is only worth what someone else is prepared to pay for it. Going back to 2005 levels may even still be a little too high, as we were just about to move into the phase when the market started to go parabolic (generally the final phase of a bubble). Credit conditions currently are a lot tighter than they were back then.

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On the topic of 2005 price levels and rateable value I would hazard a hunch that rateable values tend to be conservative so as not to be easily challenged, particularly freshly after reval. It matter little if all RVs are 5-10% under the then market value as everything is relative but it would explain why some current valuations remain stubbornly above RV.

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  • 142 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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