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Harold Bishop

Vendors Pulling Out

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It's happened three times to my ex who is a cash buyer. Three different houses, three offers accepted but a little way into each buying process, each of the vendors withdraws because the sale will leave them with "insufficient funds" to move.

I think the reason is that their mortgage companies will not offer the vendors the same loan ( amount/interest rates etc) against to new house. Further, the vendors need to find around £15k in stamp duty/agent fees/costs etc. All of this was "traditionally" added to the mortgage. So, strpping out the MEW as well and a smaller loan, these vendors are trapped and cannot sell unless they want to seriously downsize. Any hopes of moving "up the ladder" are dead. The only way is down or sit tight and pray that interest rates don't rise.

Chains failing, houses not selling and vendors stuck. All they can do is rent out and rent themselves if they abosolutey have to move. So much for a flexible workforce.

How do agents survive ? House sales requiring mortgages are on their knees and now cash sales are also failing. The only way to unlock this is to raise interest rates and force defaults and repocessions.

edit spelling

Edited by Harold Bishop

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I think that you are right in one way - an inflexible workforce is the result of the high houseprice disaster. I rent, and can move jobs from city to city, country to country. As a result I feel much more in control of my life....

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I think the chickens are coming home to roost for the EA`s the ones to adjust there sales technique first will survive and those that leave it to late will go through the hoop, with a massive shortage of buyers and the over indebted sellers things can only get worse

The vested interests have kicked the can down the road and it is now coming to a stop, the pain has to be felt before we turn the corner and the pain is a HPC

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I think the reason is that their mortgage companies will not offer the vendors the same loan ( amount/interest rates etc) against to new house.

Most banks dont mind porting your existing loan amount and interest rate to a new property as long the new place is worth more.

The vendors must be wanting a bigger loan to move up the ladder, and if they do manage to qualify for a bigger loan it wont be at the favorable rate they are getting now. So a 50% bigger loan may have a 100% larger monthly repayment of the current one + all the costs of moving you already mention.

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The vendors must be wanting a bigger loan to move up the ladder

Correct. But even if they just want more to pay the move costs of stamp duty, EA fees and a bit of MEW, they end up with a bigger mortgage against a similar value property. So, they pull out and sit tight - or expect the buyers to pay their bills.

And I think you are right about the terms being changed - so even a similar amount of mortgage may end up costing much more per month.

The whole system is fooked 'cause houses have stopped being ATMs. Cash buyers and mortgage buyers both being shut out.

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It's happened three times to my ex who is a cash buyer. Three different houses, three offers accepted but a little way into each buying process, each of the vendors withdraws because the sale will leave them with "insufficient funds" to move.

I think the reason is that their mortgage companies will not offer the vendors the same loan ( amount/interest rates etc) against to new house. Further, the vendors need to find around £15k in stamp duty/agent fees/costs etc. All of this was "traditionally" added to the mortgage. So, strpping out the MEW as well and a smaller loan, these vendors are trapped and cannot sell unless they want to seriously downsize. Any hopes of moving "up the ladder" are dead. The only way is down or sit tight and pray that interest rates don't rise.

Chains failing, houses not selling and vendors stuck. All they can do is rent out and rent themselves if they abosolutey have to move. So much for a flexible workforce.

How do agents survive ? House sales requiring mortgages are on their knees and now cash sales are also failing. The only way to unlock this is to raise interest rates and force defaults and repocessions.

edit spelling

Is he Catholic ? :P

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  • 284 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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