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House Bought In 2001. What Would You Pay For It Now?


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We're looking at a house that the current owners paid £165k for in 2001.

4 bed detached. Decent lounge, dining room, kitchen, study. Oversized garage. Nice garden.

It's located in a great area with a country park nearby, good schools, nice pubs, no chance that the surrounding area will be built on.

It doesn't look like the kitchen or bathrooms have been replaced during their ownership.

Located on the edge of a town in the east mids.

I'm not going to tell you the asking price. What would you pay?

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We're looking at a house that the current owners paid £165k for in 2001.

4 bed detached. Decent lounge, dining room, kitchen, study. Oversized garage. Nice garden.

It's located in a great area with a country park nearby, good schools, nice pubs, no chance that the surrounding area will be built on.

It doesn't look like the kitchen or bathrooms have been replaced during their ownership.

Located on the edge of a town in the east mids.

I'm not going to tell you the asking price. What would you pay?

£185K approx?

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What was the avg house price in 2001?

Looks like it was about £90k. So they paid 1.8x the avg price. On that basis £290k would be considered "avg". According to zoopla at peak it would have been "worth" £310k.

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£165k adjusted for inflation since 2001 is £218k.

So on the basis of all of that i'd consider something between £218k and £290k as "fair", depending how much i want to contribute to their HPI profit. Minus the fact that it needs a new kitchen and bathrooms.

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Looks like it was about £90k. So they paid 1.8x the avg price. On that basis £290k would be considered "avg". According to zoopla at peak it would have been "worth" £310k.

I think calculating your way is basically the correct way. Should be done with regional figures rather than national figures though, and preferably for "detached houses only" in your example. Looking at E. Mids figures from Halifax (all housing types), there was a pretty big variation through 2001.

Q1 2001 E.Mids 271,3 0,4 70.920

Q2 2001 E.Mids 279,6 3,1 73.084

Q3 2001 E.Mids 288,4 3,2 75.386

Q4 2001 E.Mids 302,8 5,0 79.153

Not knowing which quarter they bought in lets take 75k as a representative average.

The latest figures are

Q1 2012 E.Mids 531,2 1,3 138.850

So from that I would say a increase by a factor of 1.85 over the period, which gives an asking price of 305k.

Now if I was selling, then that seems a more than reasonable way to find an asking price. If that is what they are looking for I don't think it's fair to call them delusional, but I wouldn't pay it. I have little faith in today's figures due to volumes, and as far as I can see prices are only heading in one direction. If I needed to buy today then I would probably be offering just under the 250k stamp duty threshold.

Edit to add:

Just for some additional perspective, I would say that 2001 is a long time ago. It doesn't even need an annual increase of 4% to get you from 165k to 250k over 11 years.

Edited by ScrewsNutsandBolts
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We're looking at a house that the current owners paid £165k for in 2001.

4 bed detached. Decent lounge, dining room, kitchen, study. Oversized garage. Nice garden.

It's located in a great area with a country park nearby, good schools, nice pubs, no chance that the surrounding area will be built on.

It doesn't look like the kitchen or bathrooms have been replaced during their ownership.

Located on the edge of a town in the east mids.

I'm not going to tell you the asking price. What would you pay?

it depends on the house and how much it was overpaid when it was bought in 2001. A nearby house to me sold for 165k in 2001 new, in 2010 it resold for 170k, others sold for between 190k and 240k. I would say a good price would be 190k... but it depends how keenly priced the sale in 2001 was.

Edited by AteMoose
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Interesting. Thanks for the replies.

It's actually on for £280k, so £10k below my calculated "current market value" of £290k based on avg prices and what they paid in 2001.

It's in a street where houses come up for sale very rarely. Houses that we've looked at nearby, which are of similar size, but where houses come up for sale more frequently, have been put on at £240k and have sold quickly.

It's at the cheaper end of other houses on that street. The majority are bigger and obviously more expensive. Personally i'd rather it was that way round, rather than having an expensive house surrounded by less expensive.

My gut feeling is that i'd be "happy" to pay £250k. So roughly half way between what their £165k is now worth in real terms (£218k), and their asking price. So we'll have only contributed £32k above inflation to HPI. I could live with that.

Edited by the stig
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My gut feeling is that i'd be "happy" to pay £250k. So roughly half way between what their £165k is now worth in real terms (£218k), and their asking price. So we'll have only contributed £32k above inflation to HPI. I could live with that.

You could get extremely lucky and find a distressed sale at 2001 prices, but let's be honest it's not very likely. I really don't see prices being nominally flat from 2001, perhaps 2003 but no earlier. I think that will change, but it's not the case today. If they are asking 280k then there is a reasonable chance you could get them the right side of the stamp duty threshold. Good luck if you decide to have a go.

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Interesting. Thanks for the replies.

It's actually on for £280k, so £10k below my calculated "current market value" of £290k based on avg prices and what they paid in 2001.

It's in a street where houses come up for sale very rarely. Houses that we've looked at nearby, which are of similar size, but where houses come up for sale more frequently, have been put on at £240k and have sold quickly.

It's at the cheaper end of other houses on that street. The majority are bigger and obviously more expensive. Personally i'd rather it was that way round, rather than having an expensive house surrounded by less expensive.

My gut feeling is that i'd be "happy" to pay £250k. So roughly half way between what their £165k is now worth in real terms (£218k), and their asking price. So we'll have only contributed £32k above inflation to HPI. I could live with that.

i think 250k is about right, i still think it should only be about 200k though, but if you can live with that and ticks all the right boxes, area etc, go for it,

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i think 250k is about right, i still think it should only be about 200k though, but if you can live with that and ticks all the right boxes, area etc, go for it,

To be honest, the area is the main consideration. We want peace and quiet.

It seems the ideal place to find that is a street of 4 or 5 bed detached houses (i.e. perfect FAMILY homes), where most of the residents are married couples above the age of 65, who's kids have long since moved out. Sad but true.

I'm quite happy with those calculations though. The last thing i really want to be doing is working for the next 25 years paying for someone else's luxurious retirement!

Edited by the stig
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You could get extremely lucky and find a distressed sale at 2001 prices, but let's be honest it's not very likely. I really don't see prices being nominally flat from 2001, perhaps 2003 but no earlier. I think that will change, but it's not the case today. If they are asking 280k then there is a reasonable chance you could get them the right side of the stamp duty threshold. Good luck if you decide to have a go.

Unfortunately distressed sales of nice houses in good areas are proving to be few and far between. It seems that those are mostly either at the cheaper end, where someone with a low income has overstretched themselves and bought recently, normally in an area where the turnover of houses is high, or at the higher end of the market where someone with their own business has gone under in a big way!

This is in the middle, where houses coming on the market is RARE. So the occupants have lots of equity and are mostly retired.

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To be honest, the area is the main consideration. We want peace and quiet.

It seems the ideal place to find that is a street of 4 or 5 bed detached houses (i.e. perfect FAMILY homes), where most of the residents are married couples above the age of 65, who's kids have long since moved out. Sad but true.

I'm quite happy with those calculations though. The last thing i really want to be doing is working for the next 25 years paying for someone else's luxurious retirement!

Your going to hate me for saying this, but if an HPC member is thinking of offering £250k, and they're asking £280k, I don't think your offer will be the highest they'll get!

Better you wait another year or two until desperation sets in. There's alway going to be an ideal property for sale someplace.

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£165k adjusted for inflation since 2001 is £218k.

So on the basis of all of that i'd consider something between £218k and £290k as "fair", depending how much i want to contribute to their HPI profit.

Do you say the same thing to the cashier at the supermarket, Pub landlord or waiter in the restaurant.? Of course not

How they came by the house and what they paid for it is nothing actually to do with you, apart from a smalll extra piece of data to add to the Zoopla search.

What matters is:

The market conditions now

What you can afford

Your wants and needs

It actually doesn't matter what's fair because in buisness and this is to all intents and purposes the closest most people get to a business type transaction fair doesn't come into it.

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OK - well an average house in the area would be worth around £120k ( in real afforability terms not any other measure of value). But this is obviously much nicer than an average house. So perhaps add £100k for extra beds and garden and another £50k for location =£270k.

After that it comes down to how much you want it compared to the next guy and what you can afford to give up in terms of income to pay for it ( either with cash or mortgage), that would otherwie give you a great day to day lifestyle, in order to buy the house you like.

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FWIW, here's a filter of my spreadsheet showing recent sold prices for houses previously bought in 2001 between 125K and 200K.

I think it shows that averages can only ever be a broad guide, and without knowing the particular property in question none of us can really say what we might be prepared to pay today.

2001Purch125K-200K.gif

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To be honest, the area is the main consideration. We want peace and quiet.

It seems the ideal place to find that is a street of 4 or 5 bed detached houses (i.e. perfect FAMILY homes), where most of the residents are married couples above the age of 65, who's kids have long since moved out. Sad but true.

I'm quite happy with those calculations though. The last thing i really want to be doing is working for the next 25 years paying for someone else's luxurious retirement!

Don't let this cloud your thinking.

On the other side of the coin, would you take satisfaction if you bought a house on which the previous owners had defaulted and were now ruined? No you wouldn't, I hope.

Negotiate a reasonable price you're comfortable with and that you can afford. Turn it into a home.

Good luck.

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Don't let this cloud your thinking.

On the other side of the coin, would you take satisfaction if you bought a house on which the previous owners had defaulted and were now ruined? No you wouldn't, I hope.

Negotiate a reasonable price you're comfortable with and that you can afford. Turn it into a home.

Good luck.

It would be a bit mean to draw satisfaction from a previous owners default (unless it was BTL), but neither should you pity them. You should try to pay as little as possible and that is fair. If the seller accepts any offer from you then it must be fair to them too.

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We're looking at a house that the current owners paid £165k for in 2001.

4 bed detached. Decent lounge, dining room, kitchen, study. Oversized garage. Nice garden.

It's located in a great area with a country park nearby, good schools, nice pubs, no chance that the surrounding area will be built on.

It doesn't look like the kitchen or bathrooms have been replaced during their ownership.

Located on the edge of a town in the east mids.

I'm not going to tell you the asking price. What would you pay?

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Seems reasonably priced based upon halifax/lloyds price calculator and your description. Well more so than alot.

Sounds like you're in a similar situation to me. With a big deposit it starts to make more sense buying than renting but only if you provide cover for further significant drops. So I'd offer £249,999 if you really like it. And not negotiate.

But I'd expect it to go as low as £200k in "value" at some point but if it's your dream home for 10 years or more who cares?

Edited by ader
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To be honest, the area is the main consideration. We want peace and quiet.

It seems the ideal place to find that is a street of 4 or 5 bed detached houses (i.e. perfect FAMILY homes), where most of the residents are married couples above the age of 65, who's kids have long since moved out. Sad but true.

I'm quite happy with those calculations though. The last thing i really want to be doing is working for the next 25 years paying for someone else's luxurious retirement!

Over 65, in a 4-5 bed family house, no kids at home

how long do you plan on living there ?

You could see them all sell to fund their pensions so that by the time you want piece and quite you are surrounded by go-karts

Having said that you can't plan for this, just like you can't plan against having a DIY car mechanic move in next door.

All reasons why I wouldn't put money in a property unless I was surrounded by fields, and I can't afford that.

I wish you all the best if you buy. I hope it works out and you get a price your happy with.

Edited by LiveinHope
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  • 444 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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