Just Sold In London

[jcpricewatcher]

Ok, I said on another thread I would post details...

Just exchanged contracts today on a property sale in London, SE zone 2, 1 bed flat.

Bit of background. I'd sold my old place back in March 07 to avoid CGT (was almost 3 years since I lived in it), and was surprised just how quickly it got snapped up above the asking price. So suggested to other half to sell her place.

Bought for 200k in 2004, got it valued back in July 07 for around 275k. Decided at the time not to go ahead. Change of mind occurred this year and attempted to sell in March this year.

One agent said market was bad, suggested 265k, 2nd agent said market was good and confidently said it would sell for 285k and to market it for 300k. In fact he was so confident, he would pay for the HIP.

Much against my recommendation, obviously we went for the 2nd option.

Anyway, after 2 months, viewings but nothing. Eventually dropped price to 270k, 260k, but nothing (stamp duty barrier of course)

Two weeks before the term ran out, agent phoned saying he was having trouble shifting it, but said if it were on at 250k, he could sell it striaght away. So bit the bullet, and a week later got an offer from chain free buyer.

To be honest, with all the bad news, I was half expecting the buyer to pull out or gazunder, but thankfully is now going through.

She's now moving in with me, so will save around 1k per month on interest and bills plus will get cash income of several hundred per month from released equity.

Now market's so bad, I fell it's not even worth trying to sell my place now and rent.

Hopefully next year will bring bigger price reductions and then we can buy a house...

* All numbers rounded

-- Edited: More Info --

As a gauge, similar properties were being marketed at around 280-320k. It seems last month that range is around 260-300k. However, those remain unsold.

Just recently one or two are appearing at the 250k barrier, but as still on sale, so I'm guessing the supply of buyers is dropping.

The agent only just told me last week that he is hectic with valuations, he's done about 20 in the previous week! Buyers are still thin on the ground however.

Edited August 15, 2008 by jcpricewatcher

[nicebuyer]

Not a bad price considering. £50k profit plus paying off mortgage as you were going along, what does that leave you with, £75? Not bad at all Don't suppose you have a rightmove link or EA link? I'd love to see it.

[jcpricewatcher]

Not a bad price considering. £50k profit plus paying off mortgage as you were going along, what does that leave you with, £75? Not bad at all Don't suppose you have a rightmove link or EA link? I'd love to see it.

Unfortunately not being my property, not sure how keen the other half is to having it discussed here let alone the link revealed to the entire world, so best to keep it anon for now. All I can give is London SE Zone 2, 1 bed. Also best to keep agency anon for now too...

When you factor in fees (agent ~6k!, 2k buy & sell legal etc fees), stamp duty on purchase (2k), rounding of my given numbers, you're talking nearing £30k profit over 4 years. Not bad, but not stellar considering the recently London bubble. Main factor is saving about £1k per month on running costs.

Your guess at cash pot is a good one, but actually is substantially higher Though once again, not appropriate for me to discuss exact figures.

Could have maximized gain by selling last year, but that's life, and personally I think it's good to be out before the worst comes... Obviously buyer has opposite opinion

Maybe I should charge rent now I know it can be afforded?

[jcpricewatcher]

Spoke to solicitor other day regarding completion which has happened, and he mentioned that he could devote more time to the sale and get things done quicker because the amount of conyencing being done in the office was down by over 50%.

So I think that pretty much is inline with government figures and what other people have experienced.

Estate agent has said they have taken on many more instructions, but no extra buyers. Also said agreed that things are going from bad to worse... The start of the big wave of sellers?

Also on Rightmove, I can see that for similar flats a larger 2 bed flat recently went up for sale at over 130k LESS than a smaller 2 bed flat (same block as the larger one) which is still for sale... It seems the whole market is in chaos and people/agents must be having a tough time trying to work out a correct/realistic value for property...

[nicebuyer]

I just noticed, £6k for a £250k flat???? You were mugged!!!!! That's over 2%. I've not paid that much ever. Even Foxtons don't take that much, the highest I've ever paid is 1.5%. I just sold at £470k in London and paid £4k flat.

[Jim B.]

2 bed apartment £140k http://www.rightmove.co.uk/viewdetails-190...=1&tr_t=buy

1 bed apartment, same block £142k http://www.rightmove.co.uk/viewdetails-183...=3&tr_t=buy

Prices seem to be all over the place at the moment. Not that it matters I suppose as no-one will buy these.

[jcpricewatcher]

I just noticed, £6k for a £250k flat???? You were mugged!!!!! That's over 2%. I've not paid that much ever. Even Foxtons don't take that much, the highest I've ever paid is 1.5%. I just sold at £470k in London and paid £4k flat.

The deal was 2.0% + VAT including HIP, which is about £400+VAT, so ended up paying around 1.8%+VAT, not very competitive, and yes a bit of a rip off! (Though they did offer 1.7% w/o HIP)

All agents had pretty much come up with the same commission rate, and blamed lack of sales on the need to raise rates above those of last year.

But on the flip side, considering that during a time of plenty of properties and few buyers, you really want to be giving the agent extra incentive to sell your flat and not one of the others on his books!

- So they had vested interest since they had forked out £400+ upfront for HIP

- In the likely event of no buyers, there was no cash lost by vendor

- Their commission was greater than other properties on their books, so surely more incentive for them?

Either way, it's done now, and rather pay the agent over the odds than have it going stale on the market still waiting for a buyer!

Edited August 21, 2008 by jcpricewatcher

[jcpricewatcher]

2 bed apartment £140k http://www.rightmove.co.uk/viewdetails-190...=1&tr_t=buy

1 bed apartment, same block £142k http://www.rightmove.co.uk/viewdetails-183...=3&tr_t=buy

Prices seem to be all over the place at the moment. Not that it matters I suppose as no-one will buy these.

Yes, I agree - the price is pretty meaningless now if no-one intends to buy, and even those who do, they will simply offer what they think it's worth regardless of what the price tag shows.

[stormtreader]

Yes, I agree - the price is pretty meaningless now if no-one intends to buy, and even those who do, they will simply offer what they think it's worth regardless of what the price tag shows.

In the flats where Im renting, theyre all the same size - so the rooms in the 2bed are much smaller than the 1bed, hence I could see where some of the similar pricing is coming from.

[kingsgate]

We just exchanged on a flat of ours in London for £175K. Last year it was "worth" £250K + according to the madder agents.

Still, I think things will fall further, and what the hell, we bought it for £89K, so our "loss" has to be seen in perspective!

[nicebuyer]

The deal was 2.0% + VAT including HIP, which is about £400+VAT, so ended up paying around 1.8%+VAT, not very competitive, and yes a bit of a rip off! (Though they did offer 1.7% w/o HIP)

All agents had pretty much come up with the same commission rate, and blamed lack of sales on the need to raise rates above those of last year.

But on the flip side, considering that during a time of plenty of properties and few buyers, you really want to be giving the agent extra incentive to sell your flat and not one of the others on his books!

- So they had vested interest since they had forked out £400+ upfront for HIP

- In the likely event of no buyers, there was no cash lost by vendor

- Their commission was greater than other properties on their books, so surely more incentive for them?

Either way, it's done now, and rather pay the agent over the odds than have it going stale on the market still waiting for a buyer!

I suppose it's okay that they paid for the HIP up front. Still, very pricey and a HIP doesn't cost £400 +VAT. We used these guys, http://www.firsthips.com/ this was £350 inc VAT. Very good actually as they delivered the whole thing online to ourselves, the EA and the solicitors.

On the % rates, we looked around and no one was that high, not even Foxtons. But done is done and I guess it doesn't matter as the place is sold

[jcpricewatcher]

I suppose it's okay that they paid for the HIP up front. Still, very pricey and a HIP doesn't cost £400 +VAT. We used these guys, http://www.firsthips.com/ this was £350 inc VAT. Very good actually as they delivered the whole thing online to ourselves, the EA and the solicitors.

On the % rates, we looked around and no one was that high, not even Foxtons. But done is done and I guess it doesn't matter as the place is sold

Interesting, I'll keep that link in mind for next time, except I think 'next' time might be a while off!

Yes, it would have been really nice to save a grand on agent fees, but had a cheaper agent even taken an extra month to get a buyer/transaction complete, that saving would have been completely negated by the mortgage+running costs of the flat (nevermind the interest from the cash).

And nice one Kingsgate, better to take a 'realistic' under the market price now, than being too greedy, stuck waiting forever to be able to move on with your life!