Asking Prices Now Detached From Reality

[TheCountOfNowhere]

I've just updated my property bee/right move search for the the previous week ( Northants ) and I can't believe the insane asking prices I am seeing.

What I am also seeing is loads of places that had gone SSTC coming back on the market.

I am also seeing loads of places dropping their insane asking prices.

lastly, I am also seeing the houses that haven't sold over the last 12 months still sat there not selling.

It's like the agents/sellers are expecting some insane boom ( thanks to the media hype I think ).

Meanwhile, i walked round Northampton on Sunday and the place is falling apart, it's like a ghetto. The ladn registry is showing actual sale prices down on last year and sales volumes still at historic lows. Also, someone I know locally that was made redundant last year is now facing redundancy again this year with another company. There seems to have been a detachment from reality for homeowners and estate agents locally.

Edited June 10, 2013 by TheCountOfNowhere

[cashinmattress]

2014 = no Olympic effect, BASEL iii implementation, etc... yadda yadda

US coughs and we catch cold.... they say....

Infact, we are equally as screwed...

House prices matter nowt.

[Bruce Banner]

Estate agents need sales to survive. To get sales they need instructions. To get instructions they need to advise a high asking price or the agent next door will get the instruction. High asking price means sale unlikely......... vicious circle continues until sanity returns.

[StainlessSteelCat]

Asking prices have been detached from reality for most of the last ten years (at least - longer perhaps in London). No house is suddenly worth double its in a year - which the land registry apparently shows happening around 2000-2003 for many parts of the country.

The difference is that people were willing to pay ridiculous prices. They still are but the nasty bankers won't give them the cash - and it appears that EA/sellers/bankers can survive on a market with tiny amounts of transactions at high prices or perhaps more likely cannot afford to "give them away".

That's changing in many parts of the UK, where asking prices and certainly selling prices are going steadily downwards. Locally, ignore the bulk of the market where people are happy to wait for years, and look for those who are desperate.

[PopGun]

The difference is that people were willing to pay ridiculous prices. They still are but the nasty bankers won't give them the cash -

They will to investors, at rock bottom rates as well. My Mother works for a national builder, and has sold half of her allocation (between two sites) to the same individual BTL speculator. Imo prices have only one direction to travel so long as rates remain near zero (for some) and the governement owns most of the national mortgage book.

[SarahBell]

One near me on for same as it sold several years ago. Landlord selling it up.

Last night some bloke in a shiny blingy big car thing pulled up, got out and weighed it up. He paced out from the side of the house to the neighbours fence.

You'd get a two storey extension on it easily, but lose the garages. I am not sure what profit there is in it for a builder though - there'd been some big houses that never sold not far away.

[Venger]

They will to investors, at rock bottom rates as well. My Mother works for a national builder, and has sold half of her allocation (between two sites) to the same individual BTL speculator. Imo prices have only one direction to travel so long as rates remain near zero (for some) and the governement owns most of the national mortgage book.

Whilst those conditions remain then, at least I might be spared more of your excuses of how people have been lured into debt by bankers and tv and claims they're more or less entirely innocent. That some authority should exist to protect everyone from their decisions in the market. Your own mother turns out to be one of the lurers as well, earning her living in an industry selling newbuilds to people willing to pay ever higher prices. Loads of triggers still out there apart from those two major ones.

[silver surfer]

Estate agents need sales to survive.

I was talking to a local EA recently who said nearly 60% of their income is from lettings, something he described as a "healthy balance". When I asked what was "healthy" about condemning our children to a lifetime of insecure renting or crippling mortgage debt he didn't have a ready answer.

[Dorkins]

I was talking to a local EA recently who said nearly 60% of their income is from lettings, something he described as a "healthy balance". When I asked what was "healthy" about condemning our children to a lifetime of insecure renting or crippling mortgage debt he didn't have a ready answer.

It also doesn't seem particularly healthy for 60% of housing transaction costs to be coming from 15% of households.

[porca misèria]

I took a spin southwards yesterday, including bits of the (southwest) coast path and nearby country. The number of Sold boards was staggering, and some of them with asking prices significantly higher than previous sales around bubble-peak.

I fear Osborne may have spooked a lot of people with money into blowing it on property. :angry:

[Bruce Banner]

I took a spin southwards yesterday, including bits of the (southwest) coast path and nearby country. The number of Sold boards was staggering, and some of them with asking prices significantly higher than previous sales around bubble-peak.

I fear Osborne may have spooked a lot of people with money into blowing it on property. :angry:

C'est la vie.

[MrB]

The clowns are out in force, buoyed by the sunshine and the sold signs. We've put an offer in on a house 3% below asking price, rejected out of hand. Vendor is expecting asking price or above based on recent viewing activity. We're absolutely gutted as sanity was beginning to return to the market 2009-2011.

The Land Registry confirms the fact that in some areas there is a mini-boom, but some of the asking prices touted now are simply insane.

Locally, a 2 bed ex-council house sold for £171k last year. A 3 bed variant of the same house a few doors away has recently come on the market for £300k!

I can see this boomlet going on for a year or so but what comes after that?!

[19 year mortgage 8itch]

I took a spin southwards yesterday, including bits of the (southwest) coast path and nearby country. The number of Sold boards was staggering, and some of them with asking prices significantly higher than previous sales around bubble-peak.

I fear Osborne may have spooked a lot of people with money into blowing it on property. :angry:

Sounds like a man about to capitulate

[winkie]

.....the problem is for most people they can't buy another house until they have sold the house they live in.....

[pjw]

You see - even a terraced house can be "detached" - detached from reality in terms of the asking price. So we're all living in detached houses!

[Venger]

They will to investors, at rock bottom rates as well. My Mother works for a national builder, and has sold half of her allocation (between two sites) to the same individual BTL speculator. Imo prices have only one direction to travel so long as rates remain near zero (for some) and the governement owns most of the national mortgage book.

Also, for me, that info casts doubt on your long repeated claim to my challenges of just being a home-owner who wants lower prices so you can trade up.

What happened? If Mummy is still active on the sales side for a house-builder selling newbuilds, I've got a vision in my head of you happily applying to the banks for mortgage on a newbuild, where Mummy might have got you 2% staff discount, at the peak in 2007. Harder to trade up from Negative Equity for those who chose to buy in 2007 up North.

Yet you've been blaming banks alone for individuals choosing to borrow heavily for past 5 years. It's only as of recently, 4-5 years of getting what you wanted, repossession forbearance which came with rates lowered, that you've allowed borrowers to have as much of 25% of the blame for their decision to take on massive debt to buy houses.

But who was more likely to think this would happen? Banking CEOs or the X-Factor watching public? The public was brainwashed into thinking prices only ever go up, not that their dodgy debt would be picked up on the public purse. Don't get me wrong borrowers have their share of the blame, but imo it's no more than 25% of it.

Your BTLers still buying newbuilds from mummy, with few repossessions from those enjoying forbearance and very low rates to save them. Eventually they'll overstretch in my opinion, and for a bigger crash overall than if medicine had been taken in 2008-2010.

[Bruce Banner]

The Land Registry confirms the fact that in some areas there is a mini-boom, but some of the asking prices touted now are simply insane.

The Land Registry index is just as manipulated as any other index. How can an index that excludes sales on the grounds that the price is "not representative of the true market value" be taken seriously.

[motch]

The Land Registry index is just as manipulated as any other index. How can an index that excludes sales on the grounds that the price is "not representative of the true market value" be taken seriously.

Indeed, I bought a flat for 75k two years ago and a guy next door bought his (he's a BTLer) recently for around 80k, both repo's, both had previously sold new for circa £230k, these are not incuded in the Land registry index.

I was tempted to buy next door (if I could of knocked it into one) would of had a 40 foot long front room then ....and if I didn't have to pay double the already high service charges and double/higher council tax for the privelidge....

[MrB]

The Land Registry index is just as manipulated as any other index. How can an index that excludes sales on the grounds that the price is "not representative of the true market value" be taken seriously.

It probably is skewed, I think it excludes cash buyers. But locally there are a dozen or so properties on an individual level, that have increased in value since 2010.

Where we stand now, the winning tactic was to hold off buying until 2009-2011. Since then prices are up 10% ish, mortgage rates are through the floor (sub 2%), overpay like buggery for a few years....

[The Masked Tulip]

I am going to view a bungalow this week which is on for 290K with one EA firm. I am only going to view it because I know one of their main competitors valued it at 150K.

Asking prices have gone nuts in Swansea.

[Bruce Banner]

It probably is skewed, I think it excludes cash buyers. But locally there are a dozen or so properties on an individual level, that have increased in value since 2010.

Where we stand now, the winning tactic was to hold off buying until 2009-2011. Since then prices are up 10% ish, mortgage rates are through the floor (sub 2%), overpay like buggery for a few years....

I believe that house prices will fall by 30% to 40% by the end of the decade and my money is staying put, in the bank, until that time.

[MrPin]

I can see this boomlet going on for a year or so but what comes after that?!

A bustlet?