Duplex Posted February 8, 2006 Share Posted February 8, 2006 All those who predicted a house price crash in 2003, 2004 and 2005 remain shocked and confused why the great house price crash which they so confidently predicted never happened. Let me explain the reasons to them why it will not happen in 2006 either. 1)The economy is still growing (albeit it slower than before). 2) Interest rates are at low levels and stable. 3) Employment is at historically high levels. (any growth in unemployment is down to native chavs being displaced by skilled / motivated overseas workers ). 4) Immigration e.g each year the UK population rise by 250,000 they all need a roof over their heads whether it is the polish labourer who take a room in BTL in London or the returning Brit who has lived in South Africa for 20 years and sells up and buys a house with cash or the doctor who comes to the UK on a HSMP visa and commands a 50K salary in the NHS and gets a mortgage for a 3 bed semi..................they all live some where. 5) Affordability is at historically low / comfortable levels. If you look at the levels of take home pay spent on mortgage repayments, affordability remains at good levels and historically low levels. 6)Pent up demand. There is a huge back log of FTB, people who have "waited and seen" for a couple of years to see how the market will go. STR who called the market wrong and after a few years as renters now need to get back on the ladder ASAP or the wife will leave them. 7)Market sentiment is positive.Mortgage approvals for new house purchase are up to 2004 levels. YOY and 10 months of M on M rising mortgage approvals is not a sign of a HPC. 6 out 0f 7 major price surveys all show house price growth. As we go into 2006 the market has positive momentum. 8)Current Prices are sustainable by definition they have been sustained for 18 months. If there was going to be a HPC it would have happened by now. I have noticed the change in the mood of the house price crash crowd from jubilant expectation of a price crash end of 2004 early 2005 to bitter acceptance now that the HPC has been cancelled. In fact 12 months ago they regularly used to flood this and other forums in great numbers telling us how prices would "definitely fall" that the HPC was "inevitable". Funny we don't see them here no more (remember sine, crashisunderway,crash crash 2005 and all the rest) In the last 6 months you have seen their confidence slip away as prices have remained rock solid and edged up gently. Interest rates / the economy have remained steady and all the famous HPC doom and gloom predictions have been proved wrong - remember Capital Economics wrong predictions. I am always interested to read bull arguments on HPC, but I notice that the depth of the analysis and hence the validly of the argument is almost always lacking. The crucial argument that needs to be addressed by the bulls is the sustainability of deficit spending, the systemic risk associated with both a low yielding investment market and lax lending policies and the deflationary impact of globalisation. Then add the loss of manufacturing jobs, falling consumer confidence, stalling/ falling housing markets, fiscal tightening, rising fuel costs and you have all the stumbling blocks required for not just one but several property market crashes. Oooh and add the fact that these economic conditions exist in not just one but most of the worlds major economies(all the big consuming ones). No wonder some commentators view the present situation as a precursor not to a mere recession but full blow depression. Bulls, polish that turd a bit harder. Quote Link to comment Share on other sites More sharing options...
Bear Goggles Posted February 8, 2006 Share Posted February 8, 2006 The way I see it is that Gazumping and Gazundering are functions of a boom and bust housing market, so therefore the boom and bust market and it's consequencies on society is the place to look for morality. Now either we decide that we are going to attempt stop the boom and bust by somehow restricting the market, (no more boom and bust... hmm... where have I heard that before?) or we live with it and accept that markets can be brutal and stop worrying about morality. When it comes to estate agents talking about the evils of gazundering, think hypocracy, not morality. Quote Link to comment Share on other sites More sharing options...
Guest Bart of Darkness Posted February 8, 2006 Share Posted February 8, 2006 3) Employment is at historically high levels. So is the number of people on disability benefit. Are we become a nation of weaklings or.... could it be that it's a good way to manipulate the figures? Quite a lot more potential unemployment statistics are hidden away on phoney baloney courses and schemes designed for this very reason. Quote Link to comment Share on other sites More sharing options...
OnlyMe Posted February 8, 2006 Share Posted February 8, 2006 Father Fred the NAEA is not perfect but is better than nothing. there are bad members and good non-members, but on average members are better than non-members. it is trying to become a compulsory body. govt are not allowing it and no government has ever regulated EAs (licenced them). Problem is the nature of the business, you and I know that it is almost impossible for the current framework and practices to be monitored. saying that there are lots of very clear rules which trading standards do not enforce for whatever reason (resources?) Agree, don't know why. there are no rules regarding gazumping or gazundering... between acceptance of offer and exchange of contracts both parties have the freedom to do what they want. either slows the process and delays the time the EA gets paid (cash-flow being vital for any business). i do not believe agent beneifit from either practice. and besides, surely it is buyers and sellers who are the real losers, so it is the general public who should be campaigning for govt to ban both activities. Well we go back to the "professional" status of agents again, there is only so much that fragmented public complaint can do and is too easy to shake off. the only way i can see to stop either process is to speed up the time between exchange and completion... and that is part of what HIPs are supposed to do. it is unclear how successful they will be. Could be very sucessful, in fact could totally transform the whole business. There is nothing to stop property being advertised from a central or pseudo-listing listing, potenital buyers only going to see what they are really likely to be interested in and then gong to a fromal bid/offer/tender system. Piece of cake technically and maybe an ultimate aim, I don't know. Under those circumstances the only thing needed would be somebody to cover attended visits, then again it could be done on a open house basis on pre-arranged visit days. Quote Link to comment Share on other sites More sharing options...
Guest Bart of Darkness Posted February 8, 2006 Share Posted February 8, 2006 When it comes to estate agents talking about the evils of gazundering, think hypocracy, not morality. When it comes to ANYTHING to do with those turds, think hypocracy, not morality. To be lectured by one of these shyster scumbags on morality is akin to being told off by Hitler for eating meat. The social order of this country runs People. Used car salesmen. Chavs. Estate agents. Quote Link to comment Share on other sites More sharing options...
Guest muttley Posted February 8, 2006 Share Posted February 8, 2006 muttley, Again, wonder why the agents don't mind one situation but seem to mind the other. Gazumping, still get the sale + higher commission and maybe a nice little backhander too for doing the dirty deed at a late stage or a favour for a mate to be returned in due course. Gazundering - lower commission and the possibility of a sale fall-through. In my own case I apportion blame to both vendor and EA.The EA may have been "doing his job" by allowing further viewings,but I resent the fact that he didn't ever contact us to tell us about the counter-offer. Personally I would never gazunder,prefering to go down the sh*t offer route,but I shan't be losing any sleep over the morality of the buyers market. Quote Link to comment Share on other sites More sharing options...
the end is a bit nigher Posted February 8, 2006 Share Posted February 8, 2006 potential gazunderers my personal opinion is gazundering is an indication that you (subject to the vendors being timely) - are morally bankrupt or offered too much in the first place (ie you are stupid) (or both) in an idealistic world i would tend to agree, however, while it is the duty of the ea and vendor to get the best possible price, it's my duty to my family to get the best house for the lowest price possible - offering lower might not get a bite, whereas offering and then threatening to withdraw seems to suit me more - as has been said, in a rising market, this just wouldn't work (well, it might a bit) but in a falling market it seems a fair tactic - if that makes me morally bankrupt, then so be it Quote Link to comment Share on other sites More sharing options...
pricedout Posted February 8, 2006 Share Posted February 8, 2006 I don't know what all the fuss is about, if gazumping is acceptable then so is gazundering. There is no law against it and it seems to be an established part of the market, when the market is in flux. Vendors and EAs have not thought twice about ramping prices to excessive levels and after being priced out for so long, I for one would not think twice about gazundering, if that is what it takes to get a place at a reasonable price. All the EAs and OOs have been selfish and self centered - my turn soon. Quote Link to comment Share on other sites More sharing options...
Father Fred Posted February 8, 2006 Share Posted February 8, 2006 i think is BMV from a distressed seller (though i didn't know this until after completion... his car and huge bunches of keys lead me to assume he was a successful BTLer). i did not and would not gazunder. i offered, he accepted, i bought. this is, i'm sure what most BMVers do. bear goggles... did i meet you at the last meet? i did din't i? i hope i'm not that bad!!!! boom and bust is a function of capitalism. do we want capitalism... that's an entirely different matter. no reason to forget your morals though, either on the way up or on the way down. only me the market for eas will change dramatically and that is one (albeit miniscule) reason why i am out of it. i am not confident i'd be one of the lucky ones who anticipate the exact direction of the market. saying that, in many service industries it is the personal touch that makes all the difference so it may not change as quick as you think (especially on the prestife / expensive properties) Quote Link to comment Share on other sites More sharing options...
OnlyMe Posted February 8, 2006 Share Posted February 8, 2006 Father Fred The whole business needs more than a shake up that is for sure. Not putting any timesclaes on it but I think that in the future that the whole EA process will be another item that people simply won't be able to afford, I think we are looking at decades of semi-impoverished FTB's, already crippled with borrowing, naff all pensions, rising tax and working in fragmented industries on short term contracts. I really can't think of a stituation that is less condusive to supporting a market and the systems that are in place now. Quote Link to comment Share on other sites More sharing options...
Pluto Posted February 8, 2006 Share Posted February 8, 2006 Just seen this on the guardian website, should be up in the news blog... Estate agents criticise buyers' tactics So it's ok for the seller to take the highest price they can? Do they know how a market works? Greedy vendors don't like it when the shoe is on the other foot. Buyers' should still be aware that prices haven't really started to fall yet. The - real - bargains are still yet to be had. A colleage of mine who is trying to sell his house in Chingford was Gazundered last October. He refused to lower, then took his house of the market. He is putting it back on the market 10K lower than the price he refused to accept. His principles will cost him and his family dearly. Oh, and he is also in a negative equity situation. Quote Link to comment Share on other sites More sharing options...
pricedout Posted February 8, 2006 Share Posted February 8, 2006 Father Fred You keep bashing on about morality, which is quite quaint, where is the morality in ordinary working people being unable to aford a house to bring up their kids in? ( I'm not trying to suggest that they have eaten them ) Most OOs seem to have forgotten that the primary purpose of a house is to live in and raise a family in, not as a cash point. Most OOs have massive equity anyway, so if they have to take a bit of a squeeze at the time of sale for most it will only mean slightly injured pride, they'll get over it. - not as bad as having to wait years to get a house in the first bloody place. PO Quote Link to comment Share on other sites More sharing options...
Bear Goggles Posted February 8, 2006 Share Posted February 8, 2006 bear goggles... did i meet you at the last meet? i did din't i? i hope i'm not that bad!!!! boom and bust is a function of capitalism. do we want capitalism... that's an entirely different matter. no reason to forget your morals though, either on the way up or on the way down. Yes, I have met Father Fred, and I must tell everyone that he is a thoroughly nice guy. FF, I'm not suggesting you are immoral I think the argument that I'm trying to make is that there is a point at which capitalism conflicts with morality and the gazundering issue is one of those areas. Whenever I suggest that we think about the downside of market fundamentalist capitalism I get accused of being a raving loonie lefty socialist which I am not. All I'm saying is that we should either accept it or do something about it. We can't criticise estate agents for encouraging gazumping or 'professional buyers' for gazundering, it's just a function of the market, which is where the morality lies. Quote Link to comment Share on other sites More sharing options...
Pluto Posted February 8, 2006 Share Posted February 8, 2006 Greedy vendors don't like it when the shoe is on the other foot. Buyers' should still be aware that prices haven't really started to fall yet. The - real - bargains are still yet to be had. A colleage of mine who is trying to sell his house in Chingford was Gazundered last October. He refused to lower, then took his house of the market. He is putting it back on the market 10K lower than the price he refused to accept. His principles will cost him and his family dearly. Oh, and he is also in a negative equity situation. It's also a crappy tarted-up two bed converted flat, no parking, no-where for the kids to play. He payed (sit down for this) 189k for it 2 years ago. He is putting back on the market for 165K. Still about 65K too much...maybe even 80K Quote Link to comment Share on other sites More sharing options...
Flick Posted February 8, 2006 Share Posted February 8, 2006 FF I do hope you remembered to call your vendors ****ers for accepting gazumping especially after people had spent time and money on proceeding. I bet you were crying all the way to the bank. Quote Link to comment Share on other sites More sharing options...
VacantPossession Posted February 9, 2006 Share Posted February 9, 2006 Awooga! The official HPC call when you spot a troll. There is info on here somewhere, just can't be bothered to find it for you. If you are going to quote the great men in history at the foot of each of your posts, the least you can do is get the quote vaguely as the man said it. try "passed" rather than "past". Thanks! VP Quote Link to comment Share on other sites More sharing options...
ajh Posted February 9, 2006 Share Posted February 9, 2006 anger directed not at would be ftbs, but at people who think gazundering is fine. i am an ex-agent (not enough money in it!) not an agent. isn't gazumping done by buyers? eas then legally have to put the higher offer forward and it is greedy vendors who accept the higher offer. potential gazunderers my personal opinion is gazundering is an indication that you (subject to the vendors being timely) - are morally bankrupt or offered too much in the first place (ie you are stupid) (or both) I've been gazumped. 25 years ago and I still remember it with anger. I would never gazunder, as I do consider it morally the same thing. However, I would be quite prepared to tell an agent (or agents) that I had a definite sum of money to spend or less, and ask them what they could get me in that range, and chop and change if better and/or revised offers came in. But once I actually said 'Yes' and signed, I would (subject to normal legal caveats) complete. Quote Link to comment Share on other sites More sharing options...
DTMark Posted February 9, 2006 Share Posted February 9, 2006 If a house is on the market at, say, 200k, and a buyer puts in an accepted offer of 180k: If the survey then comes back with a valuation of 150k, and the buyer then drops the offer to 150k (as I asume tends to happen): Is that gazundering? Quote Link to comment Share on other sites More sharing options...
Marina Posted February 9, 2006 Share Posted February 9, 2006 (edited) People aren't saying that they think this is a good way to proceed are they? Peter. Absolutely the best way to proceed. Every property should have more than one buyer chasing it - a contract race should be compulsory - and, when you are ready to exchange - you negotiate the price again until both parties agree. I had a feeling my last buyer was going to try this tactic - so, a couple of weeks before exchange, I told the EA to make it plain to them that last minute attempts to lower the price would be result in a two fingered salute and a fond farewell. But, it's all about market strength and the positions of each buyer and seller. When property is not obviously over-priced - people just pay the asking price and get on with it. If a house is on the market at, say, 200k, and a buyer puts in an accepted offer of 180k: If the survey then comes back with a valuation of 150k, and the buyer then drops the offer to 150k (as I asume tends to happen): Is that gazundering? Not at all. I understand gazundering to mean the practice of dropping the price - take it or leave it - on the day of exchange. It's a dirty trick but one that has saved me money before. in an idealistic world i would tend to agree, however, while it is the duty of the ea and vendor to get the best possible price, it's my duty to my family to get the best house for the lowest price possible - offering lower might not get a bite, whereas offering and then threatening to withdraw seems to suit me more - as has been said, in a rising market, this just wouldn't work (well, it might a bit) but in a falling market it seems a fair tactic - if that makes me morally bankrupt, then so be it Better to be morally bankrupt than finacially bankrupt. Edited February 9, 2006 by Marina Quote Link to comment Share on other sites More sharing options...
Sisyphus Posted February 9, 2006 Share Posted February 9, 2006 Better to be morally bankrupt than finacially bankrupt. No it's not. I wouldn't gazunder but it's no worse than the gazumping that's been standard practice throughout the boom. Quote Link to comment Share on other sites More sharing options...
since the beginning Posted February 9, 2006 Share Posted February 9, 2006 (edited) I suppose the fairest way would be to sign a contract where the price of the house goes down 2% or so a month. Therefore if the whole deal takes time each month your potential new house has its correct price in this falling market Edited February 9, 2006 by since the beginning Quote Link to comment Share on other sites More sharing options...
Mildura Posted February 9, 2006 Share Posted February 9, 2006 No it's not. I wouldn't gazunder but it's no worse than the gazumping that's been standard practice throughout the boom. Gazumping/gazundering, both as bad as each other but to suggest that gazumping has been 'standard practice' is complete fiction. I suppose the fairest way would be to sign a contract where the price of the house goes down 2% or so a month. Therefore if the whole deal takes time each month your potential new house has its correct price in this falling market I may have missed something, but why is that the fairest way? The buyer actually has an incentive to drag the whole process out for as long as possible therefore increasing the chance of a gazumper appearing. Quote Link to comment Share on other sites More sharing options...
Sisyphus Posted February 9, 2006 Share Posted February 9, 2006 (edited) Gazumping/gazundering, both as bad as each other but to suggest that gazumping has been 'standard practice' is complete fiction. well I can think of two examples straight away from close friends and family. Work colleagues have also cited examples. Maybe I have been lied to. Widespread may have been a better word than 'standard' but 'complete fiction' is also wrong. Edited February 9, 2006 by Sisyphus Quote Link to comment Share on other sites More sharing options...
Marina Posted February 9, 2006 Share Posted February 9, 2006 No it's not. I wouldn't gazunder but it's no worse than the gazumping that's been standard practice throughout the boom. Where's your sense of humour? I did it once, but, funnily enough it was in the middle of the last over-heated property boom. I began to convince myself I was simply paying too much for the property so, just before exchange, I tried to knock the vendor (about 10% as I recall). He, not surprisingly, told me to go forth and multiply. Some months later property was still on the market at a slightly reduced price. I rang the agents - they were a bit frosty with me - I said 'I'm still up for it if he is - at my lower price.' He accepted and we did the deal. On the day of completion he kept us hanging around while he removed every bulb etc - he even took the (really manky) bathroom carpet with him. I said to him 'I'm glad you're taking that manky old thing, save me ripping it up and slinging it.' He thought he was being clever and left me with a loft and a shed full of junk to clear. I rang my solicitor and said 'ring his solicitor and tell him if I don't have a cheque for £500 in 7 days to clear his rubbish I will sue him for it.' I got the cheque. It's a nasty business this buying and selling property lark. Quote Link to comment Share on other sites More sharing options...
Mildura Posted February 9, 2006 Share Posted February 9, 2006 well I can think of two examples straight away from close friends and family. Work colleagues have also cited examples. Maybe I have been lied to. Widespread may have been a better word than 'standard' but 'complete fiction' is also wrong. wow, you must hang around with some truly unlucky people. i would say from experience that gazumping is a factor in a minimal number of transactions. So whilst it does occur the use of the word widespread gives the impression that if you were trying to buy a property over the last 5 years you're quite likely to be gazumped, which is just not the case. Thesaurus suggestions for widespread: common, extensive, rife... Quote Link to comment Share on other sites More sharing options...
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