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buyer2012

An Overpriced House?

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I've joined here to ask your thoughts about a house price. I found a thread once here that said you should aim to get back to 2005 or 2004 prices in this current housing market.

It probably varies over the country, but this house is valued at £214,950. It was bought for £165,000 in October 2005:

6318_GHP0008040_IMG_00_0001_max_620x414.JPG

Now, it might look inexpensive for what it is, but it is in Gainsborough, possibly the cheapest town in England. There are no industries or jobs around, the town has 18,000 people, no McDonald's or KFC, only a few shops. The Gainsborough Central railways station has 2 trains a week, both on a Saturday. There are more trains from Gainsborough Lea Road, but that is not centrally located, and you have to change in Sheffield or Doncaster to go anywhere. There are no good transport links to London. There is a minor injuries unit in town. Otherwise you need to travel 30 miles to Lincoln for an A&E department. And it is probably what you would call a "chav town" par excellence.

So our house prices are the cheapest, and they are the cheapest for a reason. So £215K is a lot for Gainsborough. You used to be able to buy a terraced house for £20K in Gainsborugh, until about 2002/03, and there are some (in a state) going for auction for those sorts of prices still. So I would hesitate to say "it's a nice house - so it must be worth the money", as the local price level has to be taken into account. After all that is said and done, if you're working from home, as I am, you can be in Gainsborough just as well as Chelsea, and the town is quiet, and very English. So not too bad - they could ruin it by expanding it - as they're planning on expanding the population to 36,000 over the next 20 years. If you need anything major, you can go to Sheffield, Lincoln, Doncaster, Retford, Scunthorpe, all sort of equidistant.

Why is this house priced at 30% above the 2005 buying price? That looks like a 2007 price to me - ie, the top of the boom. I haven't approached them, although I like the house, as I think they're unlikely to want an offer £50K below their asking price. Am I right in saying the 2005 price of £165K is the one to go for? Does the fact that Gainsborough's prices were very far below the national average for a long time and started to catch up ca. 2003/04 make any difference? Maybe you won't get them to go down to 2005 prices as they were still too low in 2005 and some of their catch-up was justified? Maybe £180K would be a realistic price?

The house is 19 Dunster Road and the postcode DN21 1HL. It is incorrectly listed on mouseprice as semidetached, which this one isn't, as you can see from the picture. There have been no sales in the road since 2007, when a semi-detached house in the same road went for £167,500. The paucity of houses sold in the road makes it difficult to determine the value. The mouseprice estimate of £184K for this house is based on the sale of a house in DN6 (near Doncaster, and not in Gainsborough at all), and so I am not sure how reliable that is.

This may be a case of a house that it would be better to wait a couple of years for, as realism drips through? it seems priced to sell in 2007 and not 2011 as far as I can see... Can anyone comment? Thanks.

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This may be a case of a house that it would be better to wait a couple of years for, as realism drips through? it seems priced to sell in 2007 and not 2011 as far as I can see... Can anyone comment?

Agreed.

If it goes don't worry, more will follow. These things take time.

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Good first post - nice little case study.

I think it's a microcosm of what is happening across the country. Pretty much all vendors (certainly within a large radius of Edinburgh) are asking for 2007 prices, and few are selling. It's been said over and over again, but with interest rates so low, vendors seem quite happy to sit on the market until they crystalise the profit that they were told to expect.

I've asked lots of builders how their prices compare to 2007, and they all say it's unchanged - it's as if they've tried to completely blank out what's happened to the economy in the interim period. For that reason, I'm pretty much resigned to waiting another year until some realism emerges.

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I've joined here to ask your thoughts about a house price. I found a thread once here that said you should aim to get back to 2005 or 2004 prices in this current housing market.

It probably varies over the country, but this house is valued at £214,950. It was bought for £165,000 in October 2005:

6318_GHP0008040_IMG_00_0001_max_620x414.JPG

Now, it might look inexpensive for what it is, but it is in Gainsborough, possibly the cheapest town in England. There are no industries or jobs around, the town has 18,000 people, no McDonald's or KFC, only a few shops. The Gainsborough Central railways station has 2 trains a week, both on a Saturday. There are more trains from Gainsborough Lea Road, but that is not centrally located, and you have to change in Sheffield or Doncaster to go anywhere. There are no good transport links to London. There is a minor injuries unit in town. Otherwise you need to travel 30 miles to Lincoln for an A&E department. And it is probably what you would call a "chav town" par excellence.

So our house prices are the cheapest, and they are the cheapest for a reason. So £215K is a lot for Gainsborough. You used to be able to buy a terraced house for £20K in Gainsborugh, until about 2002/03, and there are some (in a state) going for auction for those sorts of prices still. So I would hesitate to say "it's a nice house - so it must be worth the money", as the local price level has to be taken into account. After all that is said and done, if you're working from home, as I am, you can be in Gainsborough just as well as Chelsea, and the town is quiet, and very English. So not too bad - they could ruin it by expanding it - as they're planning on expanding the population to 36,000 over the next 20 years. If you need anything major, you can go to Sheffield, Lincoln, Doncaster, Retford, Scunthorpe, all sort of equidistant.

Why is this house priced at 30% above the 2005 buying price? That looks like a 2007 price to me - ie, the top of the boom. I haven't approached them, although I like the house, as I think they're unlikely to want an offer £50K below their asking price. Am I right in saying the 2005 price of £165K is the one to go for? Does the fact that Gainsborough's prices were very far below the national average for a long time and started to catch up ca. 2003/04 make any difference? Maybe you won't get them to go down to 2005 prices as they were still too low in 2005 and some of their catch-up was justified? Maybe £180K would be a realistic price?

The house is 19 Dunster Road and the postcode DN21 1HL. It is incorrectly listed on mouseprice as semidetached, which this one isn't, as you can see from the picture. There have been no sales in the road since 2007, when a semi-detached house in the same road went for £167,500. The paucity of houses sold in the road makes it difficult to determine the value. The mouseprice estimate of £184K for this house is based on the sale of a house in DN6 (near Doncaster, and not in Gainsborough at all), and so I am not sure how reliable that is.

This may be a case of a house that it would be better to wait a couple of years for, as realism drips through? it seems priced to sell in 2007 and not 2011 as far as I can see... Can anyone comment? Thanks.

I've had an offer accepted on a much bigger property further north, in another town, at a lower price than that house. (I dont care if i make a loss on it, it's a lovely house.)

But this property is a long way from ammenities and the train station. Def overpriced.

Good post. Its a nice house, its been extended, the rooms are a 'reasonable size'.

re-read my post...Added WHAT AM I SAYING HERE - What I've bought is going to be my HOME, Jeez cannot get the house buying crap out of my system

Edited by voidal

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If a house is priced realistically, odds are it'll sell relatively quickly.

Trouble is, Rightmove is full of overpriced houses that aren't selling, and it those that other vendors use as a guide for their own property.. rather than seeing what others SOLD for.

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I've joined here to ask your thoughts about a house price. I found a thread once here that said you should aim to get back to 2005 or 2004 prices in this current housing market.

It probably varies over the country, but this house is valued at £214,950. It was bought for £165,000 in October 2005.

Do you have Property Bee installed? http://www.property-bee.com/

It shows it originally went on the market at £245,000 - so £30k off and still more to come. :D

17 February 2011

Price changed: from '£235,000' to '£214,950'

02 September 2010

Price changed: from '£245,000' to '£235,000'

29 April 2010

Initial entry found.

As you say, nethouseprices shows that the sellers bought it for £165,000 on 14-Oct-2005. Number 7 Dunster Road sold for £130,000 on 19-Dec-2003.

I won't be looking to buy until prices are at least at 2003/4 prices - and even then they were grossly over-inflated. Around my way (West Midlands) many properties are already at those levels - I just don't yet have the deposit required to buy the type and size of home I'm aiming for; I should do in about 3 or 4 years though (should we decide to stay in the UK).

Based upon 2003/4 prices, you should be looking at making an offer between £140,000 and £150,000. That should go down well. ;)

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  • 284 Brexit, House prices and Summer 2020

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      • down 5% +
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