Has Knowing Sold Prices Changed The Market?

[cardiffone]

Has knowing sold prices changed the market?

Just wondering what effects that easy access to sold prices has had on the market the last few years.

When I bought my previous house in 2003 that info was not easy to access like it is today.

How many buyers just didn't know what previous sale prices were and ended up paying too much?

Did this lack of public information contribute to house price rises?

Even today we still don't have access to what sold houses where like at the time of sale, so still not easy to compare house A to house B in the same street as one could have been a wreck while another extended and done up.

Edited November 30, 2010 by cardiffone

[Tired of Waiting]

(...) Even today we still don't have access to what sold houses where like at the time of sale (...)

Yes, good point. It would be very useful to know it faster. It takes months for the LR to publish them.

[silver surfer]

Has knowing sold prices changed the market?

Good question. It's a useful tool for smart buyers, but as "smart buyers" have always been a very small group it hasn't made a material difference to the overall market.

[Constable]

I think this an important point re sentiment.

In recent years the sheeple have been encouraged to jump on the ladder at all costs and have not cared about previous sale prices because the expectation of future rises outweighed any value considerations (and to be fair they were largely proved correct, if only because of government policy).

Times have changed though and people will become increasingly keen to get value and previous sale prices will start to look ridiculous in many cases.

EAs hate this sort of transparency too. Every property listing (rightmove etc.) should be forced to include previous sale prices. That would be fun!

[Reluctant Heretic]

Has knowing sold prices changed the market?

Just wondering what effects that easy access to sold prices has had on the market the last few years.

When I bought my previous house in 2003 that info was not easy to access like it is today.

How many buyers just didn't know what previous sale prices were and ended up paying too much?

Did this lack of public information contribute to house price rises?

Even today we still don't have access to what sold houses where like at the time of sale, so still not easy to compare house A to house B in the same street as one could have been a wreck while another extended and done up.

I have often pondered this - logically I suppose you would expect it to speed the whole process up until there is a kind of 'real time' reaction as with stock markets. Imagine that.

[Executive Sadman]

Good question. It's a useful tool for smart buyers, but as "smart buyers" have always been a very small group it hasn't made a material difference to the overall market.

+1

Most people i know who have bought houses recently seem to buy them like they would a packet of cornflakes, unfortunately.

ie the price in the window is the going rate, dont care what it was worth 2,5, 10 years ago, and dont know what it will be worth in the future other than it will be 'worth more'

[winkie]

+1

Most people i know who have bought houses recently seem to buy them like they would a packet of cornflakes, unfortunately.

ie the price in the window is the going rate, dont care what it was worth 2,5, 10 years ago, and dont know what it will be worth in the future other than it will be 'worth more'

They must have more money available to them than sense...they are in effect throwing their future security away...so be it.

[Cinzano Bianco]

Has knowing sold prices changed the market?

Just wondering what effects that easy access to sold prices has had on the market the last few years.

When I bought my previous house in 2003 that info was not easy to access like it is today.

How many buyers just didn't know what previous sale prices were and ended up paying too much?

Did this lack of public information contribute to house price rises?

Even today we still don't have access to what sold houses where like at the time of sale, so still not easy to compare house A to house B in the same street as one could have been a wreck while another extended and done up.

Interesting question... further to that, does it affect mortgage availability - i.e. do banks mortgage valuation surveyors look at sold prices on the land registry to work out how much they will lend?

[Blue Nose Bear]

Has knowing sold prices changed the market?

Just wondering what effects that easy access to sold prices has had on the market the last few years.

When I bought my previous house in 2003 that info was not easy to access like it is today.

How many buyers just didn't know what previous sale prices were and ended up paying too much?

Did this lack of public information contribute to house price rises?

Even today we still don't have access to what sold houses where like at the time of sale, so still not easy to compare house A to house B in the same street as one could have been a wreck while another extended and done up.

Good post.

It is interesting to know previous sold prices and for HPC'ers an important source of information when considering buying a property.

But this has got me thinking, you wouldn't by a car with no service history or MOT, or if you did you would only pay peanuts.

So why do we pay much much more for a building with no real idea of it's provenance.

This is what HIPS should have done:

Full surveyors report, less than 6 months old.

List of changes made to the property by the current owner, what, when, how much spent.

Any structural or services problems rectified by the current owner, with proof.

All statements legally binding

There's probably more you can add, but at least it would have been a worthwhile exercise rather than the stupid searches that were acceptable and that daft coloured bar chart b*****ks.

Given this info and an idea of the inflation rate over the period a quick assessment could be made as to the current 'value' of the property.

[exiges]

I don't think it's changed "the market" really, perhaps only a small percentage of sales, since many purchases are made under threats of burnt dinners and no sex, and as such don't follow a logical process of investigation.

We HPCers are not you're normal bunch.

Edited November 30, 2010 by exiges

[Jadoube]

Yes, good point. It would be very useful to know it faster. It takes months for the LR to publish them.

To be fair LR don't know the sold price at the time of the sale either. They don't know until the solicitor fills in the forms and tells them. Then it has to be data captured, checked and loaded into the database.

Of course it could be faster. How much money are we willing to pay for that? (The data isn't free at present. Some people buy it and publish for free online, hopefully recovering their costs through advertising revenues. LR have not increased the price for 5 years but are about to in January.)

There are proposals to lump LR with various other agencies such as Ordnance Survey into a data shop and perhaps privatise it. Price may well go up for some data while other data becomes free.

There are people who would love to hear that people place value on more swiftly published LR data - and charge for it accordingly! I've met a couple of them. In my experience they already overvalue the data when making their business case.

[mikthe20]

 Access to price history can have the reverse effect with the feckless certain kinds of buyer. Many times I heard or read words to the effect of "the house we just bought has gone up 30% in the last two years so it's a great price to pay as it will go up 30% in the next two years too". Heard this again only just the other day from one of the yummy mummies at the school gates.   

[exiges]

LR have not increased the price for 5 years but are about to in January.)

Source ? How much ?

[jammo]

I'll certainly be sure to ask the estate agent what the house cost the last owner, or indeed when it was built when I finally get round to looking for a house. It's a fair question.

[winkie]

I'll certainly be sure to ask the estate agent what the house cost the last owner, or indeed when it was built when I finally get round to looking for a house. It's a fair question.

nethouseprices.com

will tell you.

[exiges]

Source ? How much ?

Found it http://www1.landregistry.gov.uk/property_info/ppd_add/

[RedHerring]

Found it http://www1.landregistry.gov.uk/property_info/ppd_add/

It isn't just sad bastards on HPC forum that seek out as much data as possible before buying a house. The internet, now accessed by most people, means that your average buyer knows the price of last purchase, knows what other housing on the street has been purchased for (understanding that these are in various states of condition), can spend a short time on rightmove comparing all properties for sale (instead of ringing up agents just to check what street a house is on), can use zoopla to get a valuation estimate and can use streetview to see if it is even worth visiting an area. I started looking at HPC due to a link from mumsnet and am staggered that people here are of the opinion that the majority of house buyers are stupid or a bit green. Everyone wants to negotiate and get the lowest possible price and I would think that MOST people google an address they are thinking of buying and the search will bring up nethouseprices (if it was purchased in the last decade).

[Reck B]

It isn't just sad bastards on HPC forum that seek out as much data as possible before buying a house. The internet, now accessed by most people, means that your average buyer knows the price of last purchase, knows what other housing on the street has been purchased for (understanding that these are in various states of condition), can spend a short time on rightmove comparing all properties for sale (instead of ringing up agents just to check what street a house is on), can use zoopla to get a valuation estimate and can use streetview to see if it is even worth visiting an area. I started looking at HPC due to a link from mumsnet and am staggered that people here are of the opinion that the majority of house buyers are stupid or a bit green. Everyone wants to negotiate and get the lowest possible price and I would think that MOST people google an address they are thinking of buying and the search will bring up nethouseprices (if it was purchased in the last decade).

Crap rant. Go back to mumsnet.

[buzzardo]

Has knowing sold prices changed the market?

Great question OP. It's definitely changed my view of the world, and how I'm approaching the whole buying lark...

Mrs B looking at some place at the moment (sick of renting after three years, getting well twitchy as we have several kids and she's desperate to wallpaper something - but that's entirely another story!!) Actually, for the size of the place and the location, if I didn't know what it last sold for I'd think it was fairly reasonable value if they accepted an offer of 10% off AP.

However, the LR data shows it last sold in December 2005, and it's now on the market for over £100K more than the Nationwide index calculator

http://www.nationwid.../calculator.asp

would estimate it at.

They've made some minor "improvements" like a new boiler and stuff, but a lot of the work is half-finished, or stuff that doesn't add any value at all (there's something they're really proud of in the garden, that it would cost money to rip out so it's actually devalued the place in my head, not improved it.)

So despite my "fairly reasonable value" statement earlier, my big question to the EA now is "just exactly WTF have they done, in the last five years, that makes it "worth" a hundred grand more than it should be - all other things being equal?!"

Not getting much of an answer yet, but I know for a fact we won't be putting in an offer anywhere near AP, any time this side of hell freezing over.

B

[buzzardo]

Access to price history can have the reverse effect with the feckless certain kinds of buyer. Many times I heard or read words to the effect of "the house we just bought has gone up 30% in the last two years so it's a great price to pay as it will go up 30% in the next two years too". Heard this again only just the other day from one of the yummy mummies at the school gates.

Did you take her from behind over the playground bench?

She sounds dumb enough for that kind of action to be a distinct possibility

B

[newbonic]

In a purely anecdotal vein, I know someone who was selling a house in a good area of Sheffield (cue the jokes) with good state schools etc. It had gone up a lot between 2002 wheb she bought and 2008. She was concerned that potential buyers could see what she paid vs what she was asking. As, obviously, the difference could be regarded as price reduction range, and the 2002 price as the basement. Assuming no mewing etc.

She's pretty clued up, but even the less clued up I know can't resist peeking at what their friends or neighbours paid for their houses. It seems pretty common.

[Jadoube]

Source ? How much ?

Private email (last September) to an existing buyer of the data (me) from LR Commercial Services Team attaching a document entitled 'PPI Repricing Notification' .

Broadly 17.5% but with some tinkering to the discount of regular vs one-off purchases. New prices start 1st Jan 2011.

NB This refers to the Price Paid Service, the datadase of sold prices published on various web sites, NOT other data/reports people may buy from LR.

[chicker]

Good post.

It is interesting to know previous sold prices and for HPC'ers an important source of information when considering buying a property.

But this has got me thinking, you wouldn't by a car with no service history or MOT, or if you did you would only pay peanuts.

So why do we pay much much more for a building with no real idea of it's provenance.

This is what HIPS should have done:

Full surveyors report, less than 6 months old.

List of changes made to the property by the current owner, what, when, how much spent.

Any structural or services problems rectified by the current owner, with proof.

All statements legally binding

The original idea for the HIP included a home condition report. Nu labour bottled it (too much transparency?) and dropped it from the Hip. Obviously all the people who trained as home inspectors were stuffed. The original idea was great but the final outcome was a waste of time. Even back in 2006 the gov were worried about slowing the housing market down by the vendor having to front the cost of the pack. Many people who put their homes on the market do so at a whim.

Edited November 30, 2010 by chicker

[Reck B]

This is the sort of home i'd be interested in to buy for my family to live in.

In 2001, the house was bought for £195,000 - (thanks nethouseprices!) I could have bought the house with a decent deposit and 2 times my salary on a mortgage.

The present owners put the house on the market for £420,000 in September 2010 and have since dropped it to £395,000 (thanks propertybee!)

I suppose this information has limited use in negotiating on price. I use it more as a reality check and to see how mad prices still are. Unless houses like this drop to £230k - £250k "ahhhmmm oooot"

[exiges]

In 2001, the house was bought for £195,000 - (thanks nethouseprices!) I could have bought the house with a decent deposit and 2 times my salary on a mortgage.

The present owners put the house on the market for £420,000 in September 2010 and have since dropped it to £395,000 (thanks propertybee!)

That's a bit odd.. only 2x the price that it was in 2001 ?! I thought houses had tripled or more in that time.