Many People Very Worried: Cannot Sell Their Properties.

[erranta]

There were deaths,divorces,relocations and loss of jobs between 2000 and 2004.This did not stop the market rising at a rate considerably above inflation.

But Muttley - the bank owned Estate Agents whacked 10% on prices in anticipation of every Spring Bounce, Summer Bounce, Autumn Bounce.

There were mugs at the bottom who were given lie to buy mortgages in order to buy into the game with increasingly lax and fraudulant mortgages.

Meanwhile new flats/houses etc have been increasingly sold with 'kickbacks' to 'hide' the real prices they have been sold for.

The latest has been the V.I. 10% 'tweak' before the city bonus season - any excuse to talk the market up and 'churning' new/extended mortgages/mew etc

[GCS15]

But to me a forced seller is someone who didn't want to sell in the first place.

Fair point.

But what about a forced SALE (not seller)? Is this different?

[ajh]

Was out and about earlier today, thought I'd have a drive around

one part of our local area, which is very nice indeed. The sort of

area most towns and villages have if you won the lottery, somewhere

you'd like to live. Well, I was quite amazed. The last time I was in

the area, nothing for sale, today in four of the roads, granted some

more than half to mile long, I counted 18 for sale boards. Maybe

nothing in it, or maybe panic, who knows?

This time last year I was in the UK helping my mother deal with her sister's deatch and estate matters.

One of the things we did was sell the cottage mum inherited, partly because it needed a fair bit of work but mainly because it was out in the country, not on a bus route and mum can't drive so even if she did want a UK property for her visits to see relatives it would be better to have one on a transport route.

So we sold, at probate valuation, to the local village Real Estate Agent who's husband runs a renovation/development business. While doing this we checked out the stock in the village.

Since then I've been checking the agent's website every month or so to see if they had renovated/extended the cottage and put it back on the market as planned. While there I noticed that some of the listings we inspected last year are still there; same property, same price.

Now these properties were not ridiculously over-priced, and this village is regarded as a nice place to live; quiet, sought after local school, good transport links for commuting etc., so I would think 12 months without a sale indicates a drastically slowing market.

[Guest muttley]

But Muttley - the bank owned Estate Agents whacked 10% on prices in anticipation of every Spring Bounce, Summer Bounce, Autumn Bounce.

People will more readily believe their house has increased in price than it has decreased.If the EA values their property at 250k and the best offer they get is 200k they will tell you they have only received "insulting" offers from "time wasters".(Look at the ex-pats forum)

The market has gone on hold because too many people cling on to the folk lore that "House prices never fall"

[Flash]

Your average Joe houseseller can afford to be stubborn and sit it out hoping to get the price they feel the property is "worth". There will always be forced sellers due to divorce, illness, relocation or whatever, but these are too small to make a difference - at least this is the case all the time unemployment is low.

Those that will truly DRIVE the market lower are the developers. They cannot afford to sit on vast amounts unsold property for a year. They have bills to pay. They are mostly also highly leveraged.

Imagine, the horror felt by a homeowner desperately holding out for the price they want, only to see a new development of very similar properties down the road being flogged-off at a big discount.

[GCS15]

Good point Flash.

I guess it's a bit like eBay. You see a great bargain. Put in a reasonable bid, only to have some plonkers bid the item up past what is reasonable. FFS I can buy that TODAY at the shops for less than that

[Guest muttley]

...have only received "insulting" offers from "time wasters"...

Who is wasting whom's time? I wonder

Indeed.

And if an offer can be "insulting" then so can an asking price.

[foxytrader]

Your average Joe houseseller can afford to be stubborn and sit it out hoping to get the price they feel the property is "worth". There will always be forced sellers due to divorce, illness, relocation or whatever, but these are too small to make a difference - at least this is the case all the time unemployment is low.

Those that will truly DRIVE the market lower are the developers. They cannot afford to sit on vast amounts unsold property for a year. They have bills to pay. They are mostly also highly leveraged.

Imagine, the horror felt by a homeowner desperately holding out for the price they want, only to see a new development of very similar properties down the road being flogged-off at a big discount.

That or a movement on interest rates from 4.5% to 5.5% so increasing mortgage costs by 22%. The "canard" put about by people like Kirsty is that because base rates peaked at 15% for 9 months in 1991 and bank rates are now at 4.5% the position ain't the same.

I borrowed 58k for my 2 bed flat in 1987 and the interest rate at its worst doubled my servicing costs from 7% to 14% or from £4060 to £8120 pa. I waited until 1994 before selling for 70k having tried to sell 3 years prior. Would have sold at £57.5k in 1991 but he gazundered me (remember that concept?) to £55k on day of exchange. Walked away.

If I now buy the same flat with 200k of borrowing at 6.5% SVR and rates go up by 2% my servicing costs have empirically increased by the same amount as they did in 1991.

Kirsty also conveniently ignores the fact that interest rates did nothing but go down from 1991 to 1995 while the market fell by 30% in the same period.

If you take today's market add a small rise in rates coupled with gently falling prices you have a recipe for a long slide down. Crash is redolent of Black Mondays/Wednesdays etc but it was never like that and it won't be this time.

It will be long protracted and painful for a lot of people.

[The Masked Tulip]

I am currently in the process of enacting an enduring power of attorney with regards to my Mum as she has recently been diagnosed with dementia - a soul-searching, expensive and time consuming process.

I need to put some space between my Mum and myself as she has become too dependent upon me and sadly, as some of you might know, people who suffer from dementia/alzheimers usually end up taking a lot of anger and frustration out on those closest to them - in this case, me.

Anyhow, whilst chatting to a solicitor friend the issue of where I live came up and, more for a line of conversation than anything, I said "So you think I should move out and buy somewhere now?"... to which I got the sharpest intake of breath I think I have ever heard in my Life.

To cut a long story short it turns out that his practice is currently swamped with a mixture of handling respossesions from those who cannot pay their mortgages, bankruptcy proceedings for those who have in the process of losing their houses and, on the other side of the coin, seeing what few sales they are handling fall through as buyers pull out or put in a lower price than they first offered. His advice was to rent and to not even consider buying property at the present time... so I then told him about HPC.co.uk!

On the surface, the Swansea property market looks hunkey dory. It obviously is not.

[Culpability Brown]

Nice post eric.

The Govt have majorly fuc*ed up.

Gordon can't keep his head down much longer the Bust is with us and is not going away.

His mate Tony has much to answer for too. Their phoney war on Turd has cost the economy dear.

All that cheap credit when they needed to ride out the economic cycle instead of manipulating and lying.

Big mistake!

[homeless]

A co-worker put her house on the market two weeks ago and has received an offer already! The house is a pre-war end terraced in Blackpool.The asking price was 90k.

She's also had an offer accepted on another property at 5k below asking price (130-140k range,I think) .

She is blissfully unaware of any problems or trends with the housing market and therefore very happy to be moving up "the ladder".

It surprises me how someone can make such a major purchase without doing any research.I am sure she could have got more than 5k off the next house.However,I hope it works out for her.

I live in blackpool as well, and i know why a under 100k property is selling

its becuase there are 5000 houses for sale of www.rightmove for the fylde coast and only 100 of them are below 100k, thus the buyers of these are the last few desperate people left that want there own house.

As you will drive around blackpool and the fylde like me, you will see about every 10th house for sale at the moment, take a drive along queensway on the back road to lytham, or up devonshire road or wherever in the town.There are at least twice as many houses for sale as there was last year.

For a 90k house sounds like something from mereside or perhaps the small terraced houses off newhouse road ie falkland rd ect.

If you dont believe me i ask you to look at the houses for sale in blackpool and the fylde on rightmove for the confirmation.

this area is gonna be as hard hit as anywhere probably even more(this is a low wage area).

Also i ask you to take a drive past the old miners home on the prom, they buiilt about 60 flats out of it last year, and they have a big sign up hurry up 60% already sold!!!!!, its took 3 years of pre-buying and buying after completion to get to selling 60% of them.It has also got 8 of the flats with to let signs in the windows, if you dont believe me go take a look when you pass.also i only see 1 flat that is actually lived in(second from the top in the left building)

Lot of people losing a lot of money there for sure, the for let signs have been up on there since the summer with no takers.

[deano]

A co-worker put her house on the market two weeks ago and has received an offer already! The house is a pre-war end terraced in Blackpool.The asking price was 90k.

She's also had an offer accepted on another property at 5k below asking price (130-140k range,I think) .

She is blissfully unaware of any problems or trends with the housing market and therefore very happy to be moving up "the ladder".

It surprises me how someone can make such a major purchase without doing any research.I am sure she could have got more than 5k off the next house.However,I hope it works out for her.

One of my brothers walked into a car show room to buy a car, he had no car to exchange and with £2000 pound of show price PX'ing any old banger he promptly hands over bankers draft at full asking price. Muppet!

[Guest muttley]

I live in blackpool as well, and i know why a under 100k property is selling

its becuase there are 5000 houses for sale of www.rightmove for the fylde coast and only 100 of them are below 100k, thus the buyers of these are the last few desperate people left that want there own house.

homeless,the area is off Caunce Street,pretty much town centre.The buyer was a BTL LL who put in his initial offer witout even viewing.They held out for more and he decided he better view.

The Miners Home on Queens Promenade is two seperate developments.The Miners Home itself consists of 45 flats and was bought by one developer!!! (I know the agent who handed over the keys)He has since sold some of the flats,and is letting the rest out.Some remain empty as they are not fully completed (they are just laying the carpets on the last ones)

As for Blackpool being overpriced,too right.We would like to buy in Poulton/Singleton/Gr Eccleston area but the prices are ridiculous.In fact they are London prices.

A house has come up for sale on North Park Drive at £1.4m.According to nethouseprices the best sale achieved for this road is 630k in 2004.

THIS IS BLACKPOOL FFS!!!!!

[homeless]

homeless,the area is off Caunce Street,pretty much town centre.The buyer was a BTL LL who put in his initial offer witout even viewing.They held out for more and he decided he better view.

The Miners Home on Queens Promenade is two seperate developments.The Miners Home itself consists of 45 flats and was bought by one developer!!! (I know the agent who handed over the keys)He has since sold some of the flats,and is letting the rest out.Some remain empty as they are not fully completed (they are just laying the carpets on the last ones)

As for Blackpool being overpriced,too right.We would like to buy in Poulton/Singleton/Gr Eccleston area but the prices are ridiculous.In fact they are London prices.

A house has come up for sale on North Park Drive at £1.4m.According to nethouseprices the best sale achieved for this road is 630k in 2004.

THIS IS BLACKPOOL FFS!!!!!

yeah off caunce street is quite a shithole of flats and run down properties, ie victoria street or george street ect, there building a new health centre off there just now, someone musta been mad to pay 90k there its housing benifit land.

yeah i saw that house on new park i live just around corner from there off whitegates.There are houses in division lane with a few acres selling for less than half that amount.Absoulutely nuts.

I have no idea where the money is coming from to buy all these houses, i run a buisness doign upvc fascias ect here, nd i see loads of amatuer developers, mostly from the south coming here thinking its a cash cow, reality is there all gonna be fecked rightly over.

they houses off caunce street are renting for about 80,90,100 a week so whoever paid 90k is not gonna cover the cost, and as the HB is giving to the people direct landlords all over in blackpool are getting well and truly shafted just now.

gonna be a lot of bargains here in a couple years

[Carabansity]

I was at a meeting in the Armouries in Leeds last week and before the business we were chatting about the mono culture of 2 bed flats that has sprung up around the museum. Quite a few looked empty, all the shops were unlet, little work going on the cleared sites at the top end of the canal basin. We were discussing the chance of a HPC especially with the 2 bed flats when one of the other people around the table said she understood fully as her house had been on the market all year, slowly chasing the market down, a few near misses and now nothing, no viewings or offers. She thought she would take the house off the market and try a new agent in the spring and had been quite shocked by the conversation she had heard.

[Culpability Brown]

One of my brothers walked into a car show room to buy a car, he had no car to exchange and with £2000 pound of show price PX'ing any old banger he promptly hands over bankers draft at full asking price. Muppet!

Fortunately deano, your bro got all of the muppet Gene.

I hope.

[eric pebble]

"......whilst chatting to a solicitor friend the issue of where I live came up and, more for a line of conversation han anything, I said "So you think I should move out and buy somewhere now?"... to which I got the sharpest intake of breath I think I have ever heard in my Life.

To cut a long story short it turns out that his practice is currently swamped with a mixture of handling respossesions from those who cannot pay their mortgages, bankruptcy proceedings for those who have in the process of losing their houses and, on the other side of the coin, seeing what few sales they are handling fall through as buyers pull out or put in a lower price than they first offered. His advice was to rent and to not even consider buying property at the present time... so I then told him about HPC.co.uk!

On the surface, the Swansea property market looks hunkey dory. It obviously is not.

"

Yup - not just Swansea. As I have said many times before - I think prices went up and up for so long because, to put it simply, "money" was so easy to get hold of - [laugh!!!!] - and, if you add in BTL madness, 109 tv programmes all telling you to join the Pyramid Selling Scam - and last not least - Mortgage Fraud - which is grossly underestimated - http://www.housepricecrash.co.uk/forum/ind...showtopic=19113 - THAT is what has made this such a huge bubble....... and it is so huge that no one can really predict in what way and how long it will take for that bubble is going to deflate...... But it could easily become like Japan over the last 15 years - a slow, slow escape of air as sellers live in absolute and constant denial.........

Edited November 26, 2005 by eric pebble

[selkirk]

My understanding was that CT on second props used to be 50%, but has now been increased to up to 90%? Lot of second/holiday homes near me, must be costing quite a lot now..

I think you are correct, the 50% used to be the case but I am not sure whether or not different councils apply different reductions now.

This is one I nabbed for clarification:-

http://www.canterbury.gov.uk/cgi-bin/buildpage.pl?mysql=39

I think councils now have discretion whether to charge 50% or 90% for empty properties. The rules changed last year some time. Previously the rate for empty properties was 50%.

Certainly some London boroughs now charge 90%.

That means that a landlord pays more council tax (90%) for an empty 1 bed property than a single tenant does while living in the property, because the single tenant qualifies for a 25% single persons discount, and therefore pays 75%.

[eric pebble]

I live in blackpool as well, and i know why a under 100k property is selling

its becuase there are 5000 houses for sale of www.rightmove for the fylde coast and only 100 of them are below 100k, thus the buyers of these are the last few desperate people left that want there own house.

As you will drive around blackpool and the fylde like me, you will see about every 10th house for sale at the moment, take a drive along queensway on the back road to lytham, or up devonshire road or wherever in the town.There are at least twice as many houses for sale as there was last year.

For a 90k house sounds like something from mereside or perhaps the small terraced houses off newhouse road ie falkland rd ect.

If you dont believe me i ask you to look at the houses for sale in blackpool and the fylde on rightmove for the confirmation.

this area is gonna be as hard hit as anywhere probably even more(this is a low wage area).

Also i ask you to take a drive past the old miners home on the prom, they buiilt about 60 flats out of it last year, and they have a big sign up hurry up 60% already sold!!!!!, its took 3 years of pre-buying and buying after completion to get to selling 60% of them.It has also got 8 of the flats with to let signs in the windows, if you dont believe me go take a look when you pass.also i only see 1 flat that is actually lived in(second from the top in the left building)

Lot of people losing a lot of money there for sure, the for let signs have been up on there since the summer with no takers.

By the way -- exactly the same scenario in Bournmouth too!!! Endless endless properties "For Sale" - and every other shop is an EA!!! [every other shop than the EA is a chemist?!]. Bournmouth sums up the HPC - incredible amount of speculation there - and prices so stupid you thik you've gone to another planet where the people have no brains!!

[Guest horace]

I think eric pebble is a Troll.

horace.

[eric pebble]

I think eric pebble is a Troll.

horace.

thanks horace -- it would seem you have posted this acusation more than once -- trolling perhaps?!

Always love your off-beat posts!

[88Crash]

moved

Edited November 27, 2005 by 88Crash

[The Masked Tulip]

But it could easily become like Japan over the last 15 years - a slow, slow escape of air as sellers live in absolute and constant denial.........

I still think that once it starts it will all happen within 18 months and probably quicker. I think the fact that this is a global bubble and our Media will one day be full of stories about house price falls in places like the US, Oz, Spain, etc, which will panic people.

I also think that his medium, the Internet, will have a big impact. It did not exist in the last UK HPC nor with the HPC in Japan.

Btw, I think it has started.

[fatfreddie]

Does anyone remember the market bottoming out in 1990. Great time to buy. I think we are at this stage of the market now. We are on the verge of a global recession so Alarm bells are ringing again. Compare property prices in 1990 to those now, also in respective to wages etc its frightening. Also there are more investment property owners than we have ever had in the developed world UK, Ireland, USA, Australia, NZ. Property prices are way there are in the developed world due to the new breed of inexperienced investor. You used to see them at auctions upto a year ago. The frightening thing at record low interest rates "Repossesions" are on the cards already . I honestly can't predict how low property would go if we have a major global recession. Some predictions Dow could drop from 12000 to 2000 if this was the case how low could property go....I really think its really different this time minimum 30 % in some cases 50 %. There was talk in the States in some areas hitting 10% of their original value. Its this too riculous to be true ?

[foxytrader]

Does anyone remember the market bottoming out in 1990. Great time to buy. I think we are at this stage of the market now. We are on the verge of a global recession so Alarm bells are ringing again. Compare property prices in 1990 to those now, also in respective to wages etc its frightening. Also there are more investment property owners than we have ever had in the developed world UK, Ireland, USA, Australia, NZ. Property prices are way there are in the developed world due to the new breed of inexperienced investor. You used to see them at auctions upto a year ago. The frightening thing at record low interest rates "Repossesions" are on the cards already . I honestly can't predict how low property would go if we have a major global recession. Some predictions Dow could drop from 12000 to 2000 if this was the case how low could property go....I really think its really different this time minimum 30 % in some cases 50 %. There was talk in the States in some areas hitting 10% of their original value. Its this too riculous to be true ?

Short answer - yes.

BTW market most emphatically did NOT bottom out in 1990. 1994-5 is the correct answer.