House Buying Anecdotal

[archers road]

I've been looking with my gf for over a year at buying a house, when we first started and prices were at the peak and it didn't sit right that a 2bed mid terrace cost 210k, we put it off buying but kept looking for anything resembling perceived decent "value".

We felt we'd found one about a month ago and we've been gently persuing it. It had originally been on since June at OIEO 270k, came down to £240k in September and then £230k last month. We put in an offer for 205k, which meant we had to borrow 3.5* joint earnings. Still quite a risk but there isn't anything better around here and comparing previous sales with the national average according to nationwide it appears the road has always been 50% above the national average, dating back to 1995. So 155k + 75K ish 240 would be current price, protect ouselves against 25% further falls job done, the rest of the risk we'll take.

We got rejected, so we looked at some other houses.

They came back last week and said "we will now accept 205", we were looking at another house by this time which we were told would accept 200k. So we countered with an offer of 200 to the original house. They rejected that saying they had a 200k cash offer!? who'd turn down 200k cash when they were considering 205 with a mortgage attached (FTB but still).

Phoned back today suggesting 204 would be our final offer and got rebuffed again, apparently they aren't going to "give it away" and want in excess of 210 now. DOH!

They must be watching a whole set of different news to me, i didn't think i'd hear the words "they've raised the asking price and don't want to give it away".

Do not shoot till you can see the whites of their eyes,you have a growing deposit, a falling interest rate, and a falling house market, see who blinks first!

[grizzly bear]

Of course the problem is the bubble has been going on for so long now that people have forgotten how cheap they used to be.

this is the main problem, esp for FTBs in the last few years. they have just come to expect FTB property to stretch them to the limit...

[TheLastSamurai]

Of course the problem is the bubble has been going on for so long now that people have forgotten how cheap they used to be.

Your last line really hits the nail on the head and sums up everything that is wrong with analysis in the maintstream media.

HPI has destroyed base line expectations of what housing ordinarily costs.

A piece of outdated rubbish on what is otherwise a pleasant road near me has just sold for what I expect will be over £500,000. It was on at offers over £590k (previously at £650k). 4 small bedrooms, whole house needs stripped, new bathrooms and new kitchens needed before it would even be liveable (vendor was old man carted off to nursing home by his children), moderately sized garden for the area. Garage and storage areas are rubbish. It wouldn't have sold for more than £350k five years ago, but suddenly people think they are getting "value".

If I were selling in the current market, the obvious tactic would be to retail it like a DFS sofa: put in an impossible starting price of £150k over what it would ever have achieved in 2006/7, followed by 2 quick cuts of £50k and then have the estate agent tell buyers that we were desparate to sell and would accept any reasonable offer that could go through quickly. Some mug would think they were getting the world's best bargain at 2007 price minus £50k.

[Laughing Gnome]

Perhaps D'oh but in 6months we'll have to get a new mortgage approved which with the deposits now being asked forwe probably won't be able to even get one. Got in on the Tuesday before the rate cut last month with a tracker and 90% LTV, it would be a shame not to be able to use it!

Understand the dilema. Was in a similar position in 1990; mortgage approved then moved to a lower paid safer job in between and had to act or chance it. I should have chanced it, big time.

As you say, if you will not be able to get such a good mortgage offer in future, neither will anyone else. Where's the risk, stay cool!