Jump to content
House Price Crash Forum
Sign in to follow this  
White Craw

A Different Approach To House Price Statistics

Recommended Posts

From The Herald Letters, Monday 8th November (will be an expiring link?) http://www.heraldscotland.com:80/comment/herald-letters/letters-monday-8-november-2010-1.1066623

"Reports on housing market can do more harm than good

Readers must be bamboozled with reports on the housing market. As a conveyancing lawyer of 35 years, my blood boils when I read them as I fail to see what positive contribution they make.

Statistics from organisations such as Registers of Scotland or mortgage lenders tell one-dimensional stories and I fear do more harm than good. Over the last three months I have checked the prices of 400 houses sold across Scotland against the price paid by the previous owner and the current Home Report valuation.

The average house price is 10% below the Home Report valuation. The average house price is 15% below the price the current seller paid, if purchased from 2005 onwards. Where sellers have stayed in the market by buying on they are not losing out financially as what they lose on the sale price they gain on the purchase.

Graeme McCormick, Conveyancing Direct, The Salmond Chambers, Morrison Street, Glasgow."

This chap is really getting to the nitty-gritty.

Share this post


Link to post
Share on other sites

From The Herald Letters, Monday 8th November (will be an expiring link?) http://www.heraldscotland.com:80/comment/herald-letters/letters-monday-8-november-2010-1.1066623

"Reports on housing market can do more harm than good

Readers must be bamboozled with reports on the housing market. As a conveyancing lawyer of 35 years, my blood boils when I read them as I fail to see what positive contribution they make.

Statistics from organisations such as Registers of Scotland or mortgage lenders tell one-dimensional stories and I fear do more harm than good. Over the last three months I have checked the prices of 400 houses sold across Scotland against the price paid by the previous owner and the current Home Report valuation.

The average house price is 10% below the Home Report valuation. The average house price is 15% below the price the current seller paid, if purchased from 2005 onwards. Where sellers have stayed in the market by buying on they are not losing out financially as what they lose on the sale price they gain on the purchase.

Graeme McCormick, Conveyancing Direct, The Salmond Chambers, Morrison Street, Glasgow."

This chap is really getting to the nitty-gritty.

You've reminded me of something I heard on the BBC (so it must be true), between the time 'sub prime' was first mentioned here (explained then as a uniquely American phenomenon - we do things differently) and the credit crunch a few months later. The programme came from Manchester, where estate agents were reportedly selling new build flats 'off plan' and exaggerating the sold price to Land Registry in order to sustain prices. They got around any discrepancies by giving the buyer some kind of cash back refund.

Critiques of the various surveys always quote the Land Registry figures as slow but dependable, and whenever I see that I think of the BBC report.

Anybody else heard of this, or maybe recall the BBC report?

Share this post


Link to post
Share on other sites

From The Herald Letters, Monday 8th November (will be an expiring link?) http://www.heraldscotland.com:80/comment/herald-letters/letters-monday-8-november-2010-1.1066623

"Reports on housing market can do more harm than good

Readers must be bamboozled with reports on the housing market. As a conveyancing lawyer of 35 years, my blood boils when I read them as I fail to see what positive contribution they make.

Statistics from organisations such as Registers of Scotland or mortgage lenders tell one-dimensional stories and I fear do more harm than good. Over the last three months I have checked the prices of 400 houses sold across Scotland against the price paid by the previous owner and the current Home Report valuation.

The average house price is 10% below the Home Report valuation. The average house price is 15% below the price the current seller paid, if purchased from 2005 onwards. Where sellers have stayed in the market by buying on they are not losing out financially as what they lose on the sale price they gain on the purchase.

Graeme McCormick, Conveyancing Direct, The Salmond Chambers, Morrison Street, Glasgow."

This chap is really getting to the nitty-gritty.

I like the cut of his jib. Also bears out what I am beginning to see at the lower end in Edinburgh.

Share this post


Link to post
Share on other sites

This is just so right. Prices are not going up at all. If a property sells quickly, say within the first month or so they tend to go at or around the Home Report value. The longer it goes on the more likely an offer will be less than the Home Report. The percentage less will rise the longer it is on the market.

However, an instance of how these reports affect the market. I had a call today someone asked for a value. My response was about 100K if it was really good. Oh no they said we want 115K. Why ? Well one is on a few doors up at £105K and ours is better. So I had a look at the photos of that and it was fine - so why is yours better ? Oh their decor is horrible. So they expect an extra 10K for that. I then pointed out that one had been on the market for 4 months or so and hadn't sold. No that didn't matter to them because prices were on the rise in Scotland it said so on the news ! I know that most people are not aware of the intricacies of the property market but when they are only prepared to listen to the BBC and not professional advice I do despair.

My experience at the moment is that phones are not ringing, viewers are not there and these figures will start to filter through to the Land Registry in 6 months time. However, if only 3 houses sell in that time and they are all a million pounds then the average price of a house is a million pounds, how do they spin that ?

Share this post


Link to post
Share on other sites

This is just so right. Prices are not going up at all. If a property sells quickly, say within the first month or so they tend to go at or around the Home Report value. The longer it goes on the more likely an offer will be less than the Home Report. The percentage less will rise the longer it is on the market.

However, an instance of how these reports affect the market. I had a call today someone asked for a value. My response was about 100K if it was really good. Oh no they said we want 115K. Why ? Well one is on a few doors up at £105K and ours is better. So I had a look at the photos of that and it was fine - so why is yours better ? Oh their decor is horrible. So they expect an extra 10K for that. I then pointed out that one had been on the market for 4 months or so and hadn't sold. No that didn't matter to them because prices were on the rise in Scotland it said so on the news ! I know that most people are not aware of the intricacies of the property market but when they are only prepared to listen to the BBC and not professional advice I do despair.

My experience at the moment is that phones are not ringing, viewers are not there and these figures will start to filter through to the Land Registry in 6 months time. However, if only 3 houses sell in that time and they are all a million pounds then the average price of a house is a million pounds, how do they spin that ?

Interesting to me is that even the ESPC etc.. are now trying to explain this to people in the media. Very different attitude to even 6 months ago. I reckon their members are starting to really feel the pinch of very low sales volumes and little commision. I wondered how so many could survive for so long but I reckon we must be near the point of no return for many.

Other EA's offering their services for free is not going to help matters either !!

Feee Edinburgh EA offer

Share this post


Link to post
Share on other sites

Interesting to me is that even the ESPC etc.. are now trying to explain this to people in the media. Very different attitude to even 6 months ago. I reckon their members are starting to really feel the pinch of very low sales volumes and little commision. I wondered how so many could survive for so long but I reckon we must be near the point of no return for many.

Other EA's offering their services for free is not going to help matters either !!

Feee Edinburgh EA offer

I don't know why so many professionals weren't saying this. There was a small, very small, recovery early in the year, although prices remained static generally, but since June it has definitely gone downhill. A lot of solicitor/agents have survived as they have other income streams and both they and independents have just cut everything to the bone - from advertising to staff and right down to window cleaning. I don't think all will survive but hopefully those that don't will be the ones just out to make a fast buck anyway. As a small business we used to employ 7 members of staff and now just 1. I have to admit that after being in the business for 30 odd years there are an increasing number of days recently when I have just wanted to throw it all in.

As to selling for free - I could put on loads of houses and charge no commission but still couldn't guarantee a buyer though. There are still lots who want to sell just not enough buyers unless they are realistic with their price.

Share this post


Link to post
Share on other sites

I don't know why so many professionals weren't saying this. There was a small, very small, recovery early in the year, although prices remained static generally, but since June it has definitely gone downhill. A lot of solicitor/agents have survived as they have other income streams and both they and independents have just cut everything to the bone - from advertising to staff and right down to window cleaning. I don't think all will survive but hopefully those that don't will be the ones just out to make a fast buck anyway. As a small business we used to employ 7 members of staff and now just 1. I have to admit that after being in the business for 30 odd years there are an increasing number of days recently when I have just wanted to throw it all in.

As to selling for free - I could put on loads of houses and charge no commission but still couldn't guarantee a buyer though. There are still lots who want to sell just not enough buyers unless they are realistic with their price.

Yep you seem like one of the small number who actually understand the problems. But then when these huge events take place everyone seems to get dragged down with the majority ? Same as most things really.

Good luck anyway.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 140 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%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.