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House Buyers Be Careful!

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Properties on offer through estate agents are looking increasingly like a false market. Home owners are attempting to sell at bubble prices. To be fair, a few unwary buyers who have failed to follow events in lending markets are still being suckered in. The numbers of these sales however are falling like a stone.

Auction results are a better indicator as committed buyers and sellers come together to determine a fair market price. If the property sells, it has been valued at a fair market price. If it doesn't, the reserve price does not reflect the true market value. In recent weeks properties have been selling at discounts of up to 40% in auction (see recent telegraph article). Even more revealing however are the properties which fail to sell:

Property Auction results

Only 32% of the properties sold!

Buyers; think before you make an offer! Is the price in the window realistic?

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Properties on offer through estate agents are looking increasingly like a false market. Home owners are attempting to sell at bubble prices. To be fair, a few unwary buyers who have failed to follow events in lending markets are still being suckered in. The numbers of these sales however are falling like a stone.

Auction results are a better indicator as committed buyers and sellers come together to determine a fair market price. If the property sells, it has been valued at a fair market price. If it doesn't, the reserve price does not reflect the true market value. In recent weeks properties have been selling at discounts of up to 40% in auction (see recent telegraph article). Even more revealing however are the properties which fail to sell:

Property Auction results

Only 32% of the properties sold!

Buyers; think before you make an offer! Is the price in the window realistic?

Good stuff.

People need to be warned.

The only problem is those people aren't going to be on HPC are they? :(

They are going to get their news from the BBC. :angry:

I noticed that the NWide figures got top billing on the Business section last week (or the week before),

with headlines about shrugging off the gloom, to post rises.

Whereas the HBOS figures don't mention a fall in the headline at all, just a "slowing", and they were relegated to one of the lower panels.

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Buyers; think before you make an offer! Is the price in the window realistic?

I don't know if you've ever bought a house before but most people get valuations done by a chartered surveyor before they buy a house. They value the house based on current market value and this has nothing to do with the inflated hopes of the vendor. For example you can ask whatever you want for your house and somebody may come along and be stupid enough to offer asking price but then when they get the survey they will see it is worth much less than they are offering and drop their offer.

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Only 32% of the properties sold!

That's about right.

1/3 sold proir or withdrawn

1/3 sold at auction

1/3 not sold at auction (although in many cases a deal is struck immediately after the auction).

So you're quoting what's normal and attempting to make something of it.

You are Realist Bear and I claim my £5. :rolleyes:

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Good stuff.

People need to be warned.

The only problem is those people aren't going to be on HPC are they? :(

They are going to get their news from the BBC. :angry:

I noticed that the NWide figures got top billing on the Business section last week (or the week before),

with headlines about shrugging off the gloom, to post rises.

Whereas the HBOS figures don't mention a fall in the headline at all, just a "slowing", and they were relegated to one of the lower panels.

Excuse the swearword but "anecdotal" time: somefink is going on this week. I looked at 3 properties in West Oxfordshire during July - two I ruled out on price and one because I didn't like it (AND on price). Heard nothing since.

Today I get a call from one of the two agents - one property has been reduced by 11% and the other is off the market (owners have "decided" not to sell...). So I immediately looked up the 3rd property and it has been reduced 4.5% (in last 2 days).

Anyway it's just a start of course, but I'm looking for some dominos to start toppling now..

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Properties on offer through estate agents are looking increasingly like a false market. Home owners are attempting to sell at bubble prices. To be fair, a few unwary buyers who have failed to follow events in lending markets are still being suckered in. The numbers of these sales however are falling like a stone.

Auction results are a better indicator as committed buyers and sellers come together to determine a fair market price. If the property sells, it has been valued at a fair market price. If it doesn't, the reserve price does not reflect the true market value. In recent weeks properties have been selling at discounts of up to 40% in auction (see recent telegraph article). Even more revealing however are the properties which fail to sell:

Property Auction results

Only 32% of the properties sold!

Buyers; think before you make an offer! Is the price in the window realistic?

Sounds like no real proof to me – what was the percentage sold last year (and previous ones to that) – we need at least 10 years to see any trends / proof that you are not talking trash

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Er. where have you been for the last few years? prices have been above realistic prices for ages - it is not a new phenomenon.

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I don't know if you've ever bought a house before but most people get valuations done by a chartered surveyor before they buy a house.

Hahahahahahahahha.............(pause for breath).........hahahahahahahhahahahhahahhaa...........(pause for breath)..............hahahahahahahahahahaha

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That's about right.

1/3 sold proir or withdrawn

1/3 sold at auction

1/3 not sold at auction (although in many cases a deal is struck immediately after the auction).

So you're quoting what's normal and attempting to make something of it.

You are Realist Bear and I claim my £5. :rolleyes:

Wrong! You didn't actually look at the link did you?

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In recent weeks properties have been selling at discounts of up to 40% in auction (see recent telegraph article)

Makes you wonder why boo hoo priced out people dont get off their arses and go to an auction then. Might it be that buying at an auction isnt so easy? Isnt it therefore reasonable to get cheaper prices through an auction? Is it therefore actually a daft comparison? If not, then I return to the first point - why arent priced out peeps snapping up 40% discounts?

You pay less because you need your finances in place and you have less time to check the place over. You need to know what you are doing. Auctions arent for everyone so comparing against higher EA prices is just plain crazy.

Ever watch the antiques road show? Ever wondered why they discuss an auction price and a high street price. Good grief cummon peeps I expect better from HPC. No, actually I dont.

Edited by Orbital

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Er. where have you been for the last few years? prices have been above realistic prices for ages - it is not a new phenomenon.

I am not talking about unrealistic, I am talking about a false market. Previously, auction results were just as unrealistic as the estate agent market.

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I don't know if you've ever bought a house before but most people get valuations done by a chartered surveyor before they buy a house.

As always, undiluted nonsense. There are some figures somewhere that show that the only survey the vast majority of people have done is the 'Home Buyer' survey carried out by the lender.

The lender, of course, generally speaking, could not give a monkey's what the house is worth - as long as the buyer looks like they can service the loan, they'll lend the money. Property only ever goes up, apparently, so if he buyer defaults, kick them out and sell to recover the loan.

I have never known anyone get a house they were buying independently valued.

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I don't know if you've ever bought a house before but most people get valuations done by a chartered surveyor before they buy a house. They value the house based on current market value and this has nothing to do with the inflated hopes of the vendor. For example you can ask whatever you want for your house and somebody may come along and be stupid enough to offer asking price but then when they get the survey they will see it is worth much less than they are offering and drop their offer.

Most people rely on the mortgage company valuation. Cos that's the important bit. Not what its worth but whether they'll lend you the money to buy it.

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I don't know if you've ever bought a house before but most people get valuations done by a chartered surveyor before they buy a house. They value the house based on current market value and this has nothing to do with the inflated hopes of the vendor. For example you can ask whatever you want for your house and somebody may come along and be stupid enough to offer asking price but then when they get the survey they will see it is worth much less than they are offering and drop their offer.

Your logic only works if the property is overpriced. You will never get an overvaluation from a chartered surveyor. You are deluded if you believe that the surveyor will turn around say 'sir you have agreed to pay £150K for this property but I think this house is worth £200K so you have to cough up another £50K'

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That's about right.

1/3 sold proir or withdrawn (1% withdrawn)

1/3 sold at auction (33% sold)

1/3 not sold at auction (although in many cases a deal is struck immediately after the auction). (67% available)

So you're quoting what's normal and attempting to make something of it.

You are Realist Bear and I claim my £5. :rolleyes:

Do you find that making an unfounded statement boldly enough makes people believe you and saves you the time of actually reading the facts :lol: actual numbers in red above.

Don't have time to do all months but have taken a snapshot - yes we need at least last September to be more meaningful but the latest results are atypical see table included.

auction.GIF

post-9256-1191492189_thumb.jpg

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I don't know if you've ever bought a house before but most people get valuations done by a chartered surveyor before they buy a house. They value the house based on current market value and this has nothing to do with the inflated hopes of the vendor. For example you can ask whatever you want for your house and somebody may come along and be stupid enough to offer asking price but then when they get the survey they will see it is worth much less than they are offering and drop their offer.

There is a well-conducted piece of research referenced in the book "Bubbles and How to Survive Them" which shows that surveyor's valuations are heavily influenced by asking prices - different surveyors were shown the same property. The ones who were told a high asking price valued the property on average around £10000 higher than the ones who were told a low asking price.

So the evidence that surveyors are objective is questionable.

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Properties on offer through estate agents are looking increasingly like a false market. Home owners are attempting to sell at bubble prices. To be fair, a few unwary buyers who have failed to follow events in lending markets are still being suckered in. The numbers of these sales however are falling like a stone.

Auction results are a better indicator as committed buyers and sellers come together to determine a fair market price. If the property sells, it has been valued at a fair market price. If it doesn't, the reserve price does not reflect the true market value. In recent weeks properties have been selling at discounts of up to 40% in auction (see recent telegraph article). Even more revealing however are the properties which fail to sell:

Property Auction results

Only 32% of the properties sold!

Buyers; think before you make an offer! Is the price in the window realistic?

As I posted last week at the first day of an Exeter property auction covering homes in the southwest - a staggering 55% went unsold.

And the following day I saw something I've not seen before - property being sold at less than the guide price!!!!!!

Everything sold at auction up until 6 months ago but it's been slowly getting worse.

Most property that did sell was going only fractionally over guide price

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Buying at an auction isnt so easy unless you can pay cash and know what youre talking about. If you cant get a mortgage for the property you lose your 10% deposit, which is a lot. I know that houses are overpriced now but I dont know enough about them to risk put down 20 grand at an auction only for the survey to come back and say theres rising damp and subsidence!

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That's about right.

1/3 sold proir or withdrawn

1/3 sold at auction

1/3 not sold at auction (although in many cases a deal is struck immediately after the auction).

So you're quoting what's normal and attempting to make something of it.

You are Realist Bear and I claim my £5. :rolleyes:

Just to stop people peddling tripe like this, here is a comparison with the same auction a year earlier.

September 2007

Sold 32.6%

Unsold 66.6%

Withdrawn 0.7%

October 2006

Sold 63%

Unsold 9%

Withdrawn 28%

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That's about right.

1/3 sold proir or withdrawn

1/3 sold at auction

1/3 not sold at auction (although in many cases a deal is struck immediately after the auction).

So you're quoting what's normal and attempting to make something of it.

You are Realist Bear and I claim my £5. :rolleyes:

My 55% was properties not sold on the day of auction, I discounted those sold prior or withdrawn

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Good stuff.

People need to be warned.

The only problem is those people aren't going to be on HPC are they? :(

They are going to get their news from the BBC. :angry:

I noticed that the NWide figures got top billing on the Business section last week (or the week before),

with headlines about shrugging off the gloom, to post rises.

Whereas the HBOS figures don't mention a fall in the headline at all, just a "slowing", and they were relegated to one of the lower panels.

Good point. I am going to post it on MSN.

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