Starting to view & make offers again

[2rocketman]

50 minutes ago, nightowl said:

Indeed it would be worth £1k if there was only one person interested but usually there will be more than one and most places for sale don't have to sell (except maybe a divorce order or bankruptcy).

Timing is important to the seller too because if someone offers 20% under on the first day of sale they may well ignore it in hope of better offers in the months to come. 6 months later they may change their mind if no one else offers.

Anyway the current market I believe is stalled and I guess Brexit and possible interest rate changes could be to blame. 

I am targeting houses that have been on since the beginning of summer if not longer and vacant if possible.  Even with low interest rates having 400k tied up in something you can’t cash in must be frustrating and losing you 8k per year. Paying council tax due to there no longer being exemption on empty properties must be costing/wasting a further £1500-£2000 per year. On top of that they will have to heat it through winter to avoid problems, clean windows, cut grass etc which is either more expense or eating into your own life. All the time they are watching the prices drop 25k here 25k there doing the same chasing the market down. If they have had a sale fall through previously that would of cost in solicitors fees. With the threat that Brexit could knock values further I am hoping I can tempt someone into taking a offer. A bird in the hand and all that? 

[2rocketman]

From the peak if one of my offers we’re to be accepted it would be a total reduction of around 30-35%. It would allow me to buy something that 2-3 years ago I could not of dreamed of. My stamp duty liability would drop from 17.5k to 4k. This along with a lower purchase price will increase my deposit & loan to value significantly which in turn reduces my monthly mortgage payments. The stamp would of been even higher before the changes made in the budget. Nothing is certain and it may take some time, but if I can find a deal I’m going to jump. Everywhere may be 20% down by this time next year then there would be real panic, so I’m in no hurry. Unlike others I can not see anything that is going to reverse sentiment in the next 12-18 months. Unless they fund help to buy on all properties. 
 

 

[nightowl]

21 minutes ago, 2rocketman said:

I am targeting houses that have been on since the beginning of summer if not longer and vacant if possible.  Even with low interest rates having 400k tied up in something you can’t cash in must be frustrating and losing you 8k per year. Paying council tax due to there no longer being exemption on empty properties must be costing/wasting a further £1500-£2000 per year. On top of that they will have to heat it through winter to avoid problems, clean windows, cut grass etc which is either more expense or eating into your own life. All the time they are watching the prices drop 25k here 25k there doing the same chasing the market down. If they have had a sale fall through previously that would of cost in solicitors fees. With the threat that Brexit could knock values further I am hoping I can tempt someone into taking a offer. A bird in the hand and all that? 

Different councils seem to have different tax rules on empty house due to probate though so may not be costing that much to hold out.

The trouble with Brexit is what will the BofE do...rates up or down?

It is possible they go down and has an upward effect on prices so a seller holding on makes sense. Buyers are waiting to see what will happen it seems but that also suggests there might be pent up demand and then a flurry of sales.  Remember too most of those houses for sale will be bought by people also selling.

Curious times right now!  Report any responses you get.

[Si1]

41 minutes ago, nightowl said:

.  Remember too most of those houses for sale will be bought by people also selling.

Eh? What about the bottoms of chains? And people increasing their mortgage Suze?

41 minutes ago, nightowl said:

Curious times right now!  Report any responses you get.

Not curious in the least. Just a falling market and loss of EA/trolls trying to pretend this time it's different.

[nightowl]

2 hours ago, Si1 said:

Eh? What about the bottoms of chains? And people increasing their mortgage Suze?

Not curious in the least. Just a falling market and loss of EA/trolls trying to pretend this time it's different.

There is currently a lot of for sale signs around and very few sold plus numerous just withdrawing from the market unsold. Most of those unsold houses will be bought by people willing to pay that price but waiting for someone to do the same to theirs but chains complete from the bottom upwards...but lots of unsold properties doesn't automatically mean a crash is imminent.

If FTBs (and investors) and equity releasing bank of mum and dad are waiting for a post Brexit mortgage rate change everything just stalls until up,down or hold is decided.  That predominantly decides crash or boom.

[Si1]

11 minutes ago, nightowl said:

There is currently a lot of for sale signs around and very few sold plus numerous just withdrawing from the market unsold. Most of those unsold houses will be bought by people willing to pay that price but waiting for someone to do the same to theirs but chains complete from the bottom upwards...but lots of unsold properties doesn't automatically mean a crash is imminent.

If FTBs (and investors) and equity releasing bank of mum and dad are waiting for a post Brexit mortgage rate change everything just stalls until up,down or hold is decided.  That predominantly decides crash or boom.

No the money supply will decide that. Which is in turn dictated by international fiscal and financial situation, not the whims of a retired cohort.

Edited October 20, 2019 by Si1

[highcontrast]

As well as seeing lots of vacant/no chain properties, also seeing lots of "cash only" adverts. Whats the significance/reasoning behind this? (p.s. this applies to the empty/no chain properties).

[pmf170170]

1 hour ago, highcontrast said:

As well as seeing lots of vacant/no chain properties, also seeing lots of "cash only" adverts. Whats the significance/reasoning behind this? (p.s. this applies to the empty/no chain properties).

Normally means that there is a problem with the property that would make it unsuitable for mortgage security. It could be the general condition, lack of bathroom and / or kitchen. Structural problems such as subsidence would also make a property only suitable for a cash buyer. Flats may not be suitable for mortgage security if there is a problem with the management company (or lack of one). 

[deadasadodo]

We've been buying/ selling - Hove to a greener part of Sussex. Listings have generally been coming on at peak of the market+ prices, due both to estate agents competing for business and sellers expecting what their neighbour got in 2017 plus a bit more. The house then generally sticks around until either the price is cut significantly or its withdrawn from the market. From a buying perspective it's just frustrating, as you have to wait for 3-6 months after a house is first listed before the seller is willing to consider a realistic offer. Chains are also difficult to create as a seller will say that they need £x to afford to buy their next house, which has been unrealistically listed at £y.

Some places have been priced realistically from the off and sold quite quickly. The one that sticks in my mind was like a London re-locators little fantasy, really nicely done up and reasonably priced. That sold for asking within a few days.

For our own sale we fell into the stupid trap of accepting the estate agent's bull, and our house failed to shift for ages. Eventually we accepted an offer for about 10% under the market peak of the street (similar houses). Overall impression is that the market is drifting downwards, but houses are shifting if the seller has realistic price ambitions. 

[mallish]

 

23 hours ago, Si1 said:

And then sell it desperately for 60k a year later

Any maybe sell it next week at 100k 

[mallish]

11 hours ago, pmf170170 said:

12 hours ago, highcontrast said:

As well as seeing lots of vacant/no chain properties, also seeing lots of "cash only" adverts. Whats the significance/reasoning behind this? (p.s. this applies to the empty/no chain properties).

very often these will have a sitting tenant 

[mallish]

50 minutes ago, deadasadodo said:

Some places have been priced realistically from the off and sold quite quickly. The one that sticks in my mind was like a London re-locators little fantasy, really nicely done up and reasonably priced. That sold for asking within a few days.

For our own sale we fell into the stupid trap of accepting the estate agent's bull, and our house failed to shift for ages. Eventually we accepted an offer for about 10% under the market peak of the street (similar houses). Overall impression is that the market is drifting downwards, but houses are shifting if the seller has realistic price ambitions. 

Same where I am if a house is on at a sensible price they are selling quickly and it is of course all relative if you sell for less than you may have done you can buy for less - at the end of the day it is a home not an investment 

[Si1]

2 hours ago, mallish said:

 

Any maybe sell it next week at 100k 

?

[Locke]

On 10/10/2019 at 12:10, 2rocketman said:

Yes, indeed. That is a very good point. 

Decide the price you want, then take 25% off of that.

Have you been to a country where haggling is common? It makes a good holiday and life lesson about what a price actually is.

[Locke]

On 20/10/2019 at 12:03, nightowl said:

what will the BofE do...rates up or down

Down (in the long run), regardless what happens.

A bank with government-backed control of the currency is like a glider. Yes, updrafts and thermals will keep them up for a time, but they are eventually going to hit the ground.

[rockerboy]

On 16/10/2019 at 09:14, rockerboy said:

I'm banking on the 1960s generation and future IR tax policies having a large effect on the price of certain properties .

I've always thought that Dual living will be one of the few IR loopholes left in 20 years, so I made sure the house I bought had granny flat potential - it does.

Now it could be useful for me and dependants (but I don't want to tie them down to live near me thinking about this) , but I'm thinking it will also be useful for those who want to buy the property when I'm old 

Dual Living may not be a significant house choice factor now, but I'm betting it will be for the children and elderly 1960s parents who want to dodge IR

Its happin' I tell ya.

Get a house + granny flat before everyone else cottons on

https://www.bbc.co.uk/news/education-49974001

Up to you if you want to think I'm pumping up the value of my own purchase, but I successfuly called the 3 bed semi negative equity demise in the 80s and the 4 bed detached despiration in the 90s. 

Downtraded in 2007 and bought the current place. Reckon I'm at the front of this next "house+granny flat"  HPI queue .

Its all based in the 60s baby boomers generation needs - and now its the needs of their  "Mum and Dad, I can't afford a house" children.

Up to you  - Snooze you lose   

*edit* - What I should have said, is that it will depreciate less than other types of houses 

 

Edited October 21, 2019 by rockerboy

[2rocketman]

On 19/10/2019 at 13:21, 2rocketman said:

My most recent viewing went quite well. I liked the house, however it needs work throughout. Location is 10/10.

The estate agent advised me “prices never drop in this area” whilst in the next breath saying “prices have now stabilised” all a load of rubbish of course. They’ve been consistently dropping since 2016 albeit slowly.

I left it a day and offered -20% expecting a bit of a frustrated response from the EA followed by an immediate refusal from the vendor. The response I actually got off the EA when putting forward the offer was quite good. Yesterday I received an email saying “the owner is going to take the weekend to have a think about it”

At best it will be a counter offer, at worst refusal but it’s not an outright don’t be so ridiculous on a 100k reduction. 

I have another viewing booked for beginning of next week elsewhere, I’m happy to keep moving along unless a real opportunity presents itself, but you have to be in it to win it. 

 

 

 

Estate agent contacted me today to advise the sellers have decided to remove the property from the market with immediate effect.???Their intention is to rent it! Hope they don’t encounter S24??? 

[hurlerontheditch]

5 minutes ago, 2rocketman said:

Estate agent contacted me today to advise the sellers have decided to remove the property from the market with immediate effect.???Their intention is to rent it! Hope they don’t encounter S24??? 

they wont give it away....

[bear.getting.old]

On 11/10/2019 at 13:24, Dorkins said:

The fact that there was one person out there willing to pay 100k doesn't mean there are any more like them. Early bird catches the worm. If 75k is the highest offer then it's the highest offer, take it or leave it.

Lots of older owners out there with that kind of attitude, I want peak price plus a bit for my trouble, I'm not giving it away. As spyguy says, they will leave the house in a pine box and then price discovery can take place.

I suspect this will be the main driver of house prices during the 2020s, HPI true believers born in the 1930s-40s kicking the bucket and then their housing-poor younger relatives selling for whatever they can get in order to help solve their own housing problems.

Real world example of my family  selling family members house probate sale. Last summer they could have sold it for 245k for 2 bed end terrace. She listed for 240k, few viewings not a bite. 6 months later she cut to 230k. Viewings came, a savvy buyer offered 220k. She settled on 225k. Buyers can sense the will to sell and I think given the way the house prices in London comutter towns are falling, reducing to 230k - 225k to sell was the right thing to do. Its a shame many other sellers have yet to see this.

[scottbeard]

3 hours ago, bear.getting.old said:

Real world example of my family  selling family members house probate sale. Last summer they could have sold it for 245k for 2 bed end terrace. She listed for 240k, few viewings not a bite. 6 months later she cut to 230k. Viewings came, a savvy buyer offered 220k. She settled on 225k. Buyers can sense the will to sell and I think given the way the house prices in London comutter towns are falling, reducing to 230k - 225k to sell was the right thing to do. Its a shame many other sellers have yet to see this.

Always interesting to get a real story.  And selling for 225k is 6% ish below the original asking price of about 240k which sounds fairly typical - certainly my own house buying story in 2011 is fairly similar (owners reduced it by 5% from original asking, I then negotiated a further 5% off).  Even in a atble or rising market people normally are expecting to knock 5% ish off the asking price.

I do very much doubt that these people who want to offer 20% or more below the current asking price will end up actually buying anything today - if they really think prices are about to fall 20% the only way to capitalise on that is to sit in cash until it happens and THEN offer 20% less than today's asking price.

[Gush]

13 minutes ago, scottbeard said:

Always interesting to get a real story.  And selling for 225k is 6% ish below the original asking price of about 240k which sounds fairly typical - certainly my own house buying story in 2011 is fairly similar (owners reduced it by 5% from original asking, I then negotiated a further 5% off).  Even in a atble or rising market people normally are expecting to knock 5% ish off the asking price.

I do very much doubt that these people who want to offer 20% or more below the current asking price will end up actually buying anything today - if they really think prices are about to fall 20% the only way to capitalise on that is to sit in cash until it happens and THEN offer 20% less than today's asking price.

how will  it fall 20% without one offering 20% below asking and getting accepted? That is what 2R plans to do.

[scottbeard]

20 minutes ago, Gush said:

how will  it fall 20% without one offering 20% below asking and getting accepted? That is what 2R plans to do.

One of two things will happen:

1. It will be taken off the market....then put back on again next year 10% lower....then it still won't sell....and then they'll take it off the market again...and then put it on again 5% lower still, and then you put in an offer 5% below THAT - and bingo.

2. It will sell today for 5% below asking.  Then, in 2 years time, another similar house will come on the market for 20% less, and you buy that one.

I'm basically saying I don't think 2R's plan of trying to pay the 2021 price in 2019 works very well.

[Biggus]

On 12/10/2019 at 17:03, Simhadri said:

Currency will continue to devalue to keep banks at the helm of money printing. Which causes increase in property prices over medium to long term. It's inevitable.

Yeah, that's been the experience of the last two decades. But I have to think good sense will return some day.

If the economy were well run interest rates would be about seven percent. On the gold standard the BOE kept rates at five percent for centuries. With a two percent inflation target seven percent would be about right for the long term. Seven percent interest rates would mean a huge reduction in house prices.

But then, we've had two decades of the economy being run like a banana republic. Those of us waiting for sanity to return have been shafted. Maybe taking the plunge is the right call. It's difficult to make good financial decisions in this crock up of an economy.

 

Edited October 24, 2019 by Biggus
changed a blacklisted word.

[bear.getting.old]

19 hours ago, scottbeard said:

One of two things will happen:

1. It will be taken off the market....then put back on again next year 10% lower....then it still won't sell....and then they'll take it off the market again...and then put it on again 5% lower still, and then you put in an offer 5% below THAT - and bingo.

2. It will sell today for 5% below asking.  Then, in 2 years time, another similar house will come on the market for 20% less, and you buy that one.

I'm basically saying I don't think 2R's plan of trying to pay the 2021 price in 2019 works very well.

I totally agree. You can't get such a big reduction so quickly in 2019 in the the current market. The rush to sell isn't there because most buyers think they can sell for 5-10% down today. Interestingly, after the thread on here about zoopla valuations I looked at a house that sold a year ago and zoopola reckoned it's down 12k over the year last month. This month it reckons its above what it sold for! Made up figures or what!! 15 K rise in a month?

Edited October 24, 2019 by bear.getting.old

[2rocketman]

12 minutes ago, bear.getting.old said:

I totally agree. You can't get such a big reduction so quickly in 2019 in the the current market. The rush to sell isn't there because most buyers think they can sell for 5-10% down today. Interestingly, after the thread on here about zoopla valuations I looked at a house that sold a year ago and zoopola reckoned it's down 12k over the year last month. This month it reckons its above what it sold for! Made up figures or what!! 15 K rise in a month?

I don’t agree. You can not generalise like that. Each property, each sellers position is different. It could be inheritance, they may have debts, they may want to take advantage of the brexit effect and buy abroad. Who knows? 

It all depends what property you are talking about. I personally am looking for something that needs some work (not major) and is vacant maybe probate or owned by someone gone into care. Something that has already been on the market for 6 months to a year, something that can not be rented. There are plenty like this around, I have my eye on quite a few and an offer in on one currently. What would the vendor have to gain by holding it for another year? When they have seen the price fall over the last 12-18 months. All the hassle & costs involved in keeping a property vacant. I think prices will only deteriorate from here,  it’s whether the seller is of the same opinion. I am not saying my strategy would work on an up to date 3 bed semi with a family living in it. It may though I guess if that can get a reduction the other end. You won’t know unless you try.