First Time Buyer Help Needed- Mid Ulster

[lefthand]

I have been a long time lurker on this forum and have finally got around to registering and posting

I am looking to buy in Mid Ulster, probably around the Maghera area.

Most of the property that we have looked is still over priced.

But in the last month we became aware of the following property Burns maghera. The agreed sale price for this property was £150000 and that included all contents. The house was a show house

We have made enquires about other similar properties in the same area(same estate The Hawthorns) and we are getting quotes back of £175000 for a 3 bed semi on the same estate and £207'000 for a 4 bed detached(near enough the same house without all the contents).

We have placed a couple of offers well below the asking price but have been knocked back.

would like to know what do you think would be realistic asking prices for these types of house in the current climate?

Would we be better just to sit tight or will the sale of a 4 bed 2 storey detached house for £150000 be the start of realistic house prices in the area?

[polythene pam]

The rateable value for that house is 135k. 150k would be a generous sum.

[lefthand]

The rateable value for that house is 135k. 150k would be a generous sum.

I have tried to find out the rateable value for these properties via the website but i keep getting unknown entry on the website. How did you find that out so quickly???

Edited December 26, 2008 by lefthand

[Belfast Boy]

The rateable value for that house is 135k. 150k would be a generous sum.

Here is the link to the rateable value of the house shown 10 Hawthorne Avenue, Maghera - click here.

Why do you want to buy in a falling market? When do think house prices will stop falling?

I think that if you can wait for just 1 more year then sellers will be alot more realistic. The recession is only starting and it looks like it is going to be a nasty one

Edited December 26, 2008 by Belfast Boy

[lefthand]

I would not say that i was happy paying £150000 for a house but it is the only property in the area where i feel that the seller has accepted current market values. We have viewed loads of properties in the area but they are still at unrealistic prices.

Suppose i was just wondering what a realistic asking price was for a house around there.

We can afford to sit tight for a while but we are getting married late next year and it would be nice to have a decent house at an affordable price sorted before the wedding

Edited December 26, 2008 by lefthand

[lefthand]

I've been watching houses in Mid Ulster myself and feel that they are very unrealistically priced considering the fact that most reports say that Mid Ulster is dropping 30%. If you look at the "Sale agreed on NI propertynews " on TDGTTS you will note that there are little if any sale agreeds for Maghera area. Its Mexican standoff time. If you can even hold off till late January /early Feb you might see a different situation. However if your heart is set on that house and you feel that you won't see anything you like better - then its your decision.

I think you ave misinterrupted me doccyboy.

We have not bought the house in question or agreed to but it's just the first one we have heard of in the area that represents a bit of value.

I know what you mean about stand off time. We have put in low offers with room for negotaition but they have just been knocked straight on the head.

What do you think would be a reasonable price to pay for a 3 or 4 bed detached house in the area?

[sdoey]

What do you think would be a reasonable price to pay for a 3 or 4 bed detached house in the area?

A price where only one person alone is able to pay the mortgage debt! Do you really want you and your other half having to both work to pay every month for an overpriced shoe box.

I think many folk in NI have taking on a debt that they will NEVER be able to pay off!! I know one person who paid I think about 175K last year for a house over a 40 year period and is now in negative equity!

[Belfast Boy]

We can afford to sit tight for a while but we are getting married late next year and it would be nice to have a decent house at an affordable price sorted before the wedding

... nice but not strictly necessary.

Have you considered renting for 1 year? With all the uncertainty about the economy and house prices, renting would seem like the wise thing to do.

Job security has to be a major consideration these days too.

Though I do understand your desire to buy your own place. I know a young couple who are getting married soon too. He wanted to wait and see where everything was going. However, she was not prepaired to wait. She fell for all the rubbish about 'now is a good time to buy.' I think they only got 25% off the house they bought. That is going to look like a big mistake if I am right and prices fall by more than 60%. I hope when he realises what a mistake he was pushed into, that it will not put a strain on their relationship.

I guess what I am trying to say is - whatever you decide to do - make sure that you both completely agree. If the decission turns out to be a mistake, then you made the mistake together. Then there can be no blame game in the future.

[lefthand]

... nice but not strictly necessary.

Have you considered renting for 1 year? With all the uncertainty about the economy and house prices, renting would seem like the wise thing to do.

Job security has to be a major consideration these days too.

Though I do understand your desire to buy your own place. I know a young couple who are getting married soon too. He wanted to wait and see where everything was going. However, she was not prepaired to wait. She fell for all the rubbish about 'now is a good time to buy.' I think they only got 25% off the house they bought. That is going to look like a big mistake if I am right and prices fall by more than 60%. I hope when he realises what a mistake he was pushed into, that it will not put a strain on their relationship.

I guess what I am trying to say is - whatever you decide to do - make sure that you both completely agree. If the decission turns out to be a mistake, then you made the mistake together. Then there can be no blame game in the future.

Job security is not a issue for us. Both working in the public sector.

Myself as a teacher and she is a nurse.

It's funny. I remember 10 years ago people telling me i was nuts headin into teaching. No money i was told.

Strange how the worm turns.

Renting is definetley an option but we want to be able to take advantage if we see a suitable property.

The house i used as an example may have interested us because it included everything, fully furnished.

It's good to know that my personal valuation of property in the area £120000-£130000 is similar to other posters on here. It's just a matter of being patient and waiting on the sellers to KOP ON.

[YoungFTB]

First and foremost welcome to the forum!

Personally I am waiting until houses return to rateable value (2005 prices) If houses fall to that level then I'll be happy to buy.

No one knows where house prices are going, it really depends on what we are facing economically. If it's a sever recession then 50 - 60% drops are very possible but if we are facing a depression then who knows!

The majority of people who post here feel that prices will drop 50 - 60% in total so I'm waiting until the end of 2009 to see what happens and then I'll start looking for a place.

[JoeDavola]

At the end of the day, all that matters is that you get a place you like at a price you can comfortably afford.

If I were you though, I would wait another year at least. Probably best to wait closer to two years.

[Belfast Boy]

No one knows where house prices are going, it really depends on what we are facing economically. If it's a sever recession then 50 - 60% drops are very possible but if we are facing a depression then who knows!

There is a 18 year business cycle. This cycle usually ends with recession. This is a well known and documented economic occurance. A recession is definitely happening now.

There are some people who believe what we have entered is a K-winter or the end of a grand super cycle. These K-winters happen quite regularly too. Here is a link to a wiki page about Nikolai Kondratiev - click here. This only occurs once in a lifetime. I'm not saying that is happening now, but it has happened before and it is a possibility that needs to be considered.

Scary isn't it I really, really hope it does not happen.

[debt_ridden_ftb]

There is a 18 year business cycle. This cycle usually ends with recession. This is a well known and documented economic occurance. A recession is definitely happening now.

There are some people who believe what we have entered is a K-winter or the end of a grand super cycle. These K-winters happen quite regularly too. Here is a link to a wiki page about Nikolai Kondratiev - click here. This only occurs once in a lifetime. I'm not saying that is happening now, but it has happened before and it is a possibility that needs to be considered.

Scary isn't it I really, really hope it does not happen.

The shit is really hitting the fan now.

This is going to be one major crash, one that nobody will forget. It has been fuelled with a debt binge orgy over the past 10 years and is now coming to a head.

Any 'equity' gains over the past number of years will be completley wiped, with all those who mewed to maintain unsustainable lifecycles in tears and they have brought it all upon themselves.

I envisage this will result in a major re-distribution in wealth.

[YoungFTB]

There is a 18 year business cycle. This cycle usually ends with recession. This is a well known and documented economic occurance. A recession is definitely happening now.

There are some people who believe what we have entered is a K-winter or the end of a grand super cycle. These K-winters happen quite regularly too. Here is a link to a wiki page about Nikolai Kondratiev - click here. This only occurs once in a lifetime. I'm not saying that is happening now, but it has happened before and it is a possibility that needs to be considered.

Scary isn't it I really, really hope it does not happen.

Thanks for the link BB, that was really interesting stuff

Edited December 27, 2008 by YoungFTB

[lefthand]

Well an wee update for you all.

Thanks for all the advice and i suppose that we have decided to rent for the next couple of months at least.

Prices in the area have just not been adjusted and it seems to be a huge Mexican stand off as DoccyBoy has stated.

Doccyboy in your opinion would a resonable price for a house in the area be it's rateable value minus say 7%??

I have just noticed that the house that i originally used as a 'value' example has been placed back on the market

Burn maghera

but this time the asking value is £179000 plus £5000 for content.

How can an estate agent justify placing a house back on the market at over £35000 over what the sale agreed price was last month in a falling market?

[mr slump]

I am no expert but I have lived through interest rates going from 8% to 16% and trying to put food on the table. The current low rates have led many estate agents and vendors to think the glory days are coming back.

I agree there

but for the EA its not a good lever against the facts- see>

http://newsimg.bbc.co.uk/media/images/4518...29ee54d6a27.gif

even at that rate average mortgages are 3x salary with average 25% deposit

affordable with enough security to cover a 25% drop in value (for the bank)

against ni prices + wages that just won't stack up, no matter what the interest rates are

plus the bank surveyors will have to value low

looking forward to the next chat with an EA if that rates rubbish is spouted

[BelfastVI]

The shit is really hitting the fan now.

This is going to be one major crash, one that nobody will forget. It has been fuelled with a debt binge orgy over the past 10 years and is now coming to a head.

Any 'equity' gains over the past number of years will be completley wiped, with all those who mewed to maintain unsustainable lifecycles in tears and they have brought it all upon themselves.

I envisage this will result in a major re-distribution in wealth.

If this 'wealth' was an illusion, how can it be re-distributed. It will disappear into the unknown from which it appeared.

[Belfast Boy]

I am no expert but I have lived through interest rates going from 8% to 16% and trying to put food on the table. The current low rates have led many estate agents and vendors to think the glory days are coming back.

... you have just summed up why I will not be buying a house this year. It is going to come as a surprise when interest rates are near 0% and house prices still fall hard this year. The effects of unemployment are going to be the main factor this year, not cheap lending. Estate agents and vendors are going to be alot more realistic next year. Especially at the end of 2010 when there is no spring bounce again

... average 25% deposit

... to cover a 25% drop in value (for the bank)

... large deposits will be the main thing killing the housing market this year. The small amount of people who have saved deposits will be insignificant.

It is easy to buy a house with a 125% Northern Crock mortgage or a 100% mortgage. Now most potential buyers need to save a 10% deposit. This greatly restricts the number of potential first-time buyers. Without first-time buyers their can be no buying chains. So sales volumes will be greatly effected too.

Edited January 6, 2009 by Belfast Boy

[lefthand]

Again have been having a wee look again in midulster this week but nothing much seems to be changing.

Was emailing one of the estate agents in the area about certain properties and there prices being way over priced.

I recieved the following reply

"Hi

You referred to the property in X1 this property was reduced from

£175,000 to £169,000 a reduction of approx 3.4% in this case as with several

other vendors there is a mortgage involved and vendors cannot sell below

what they need to clear their mortgage. In this case the seller may settle

at a level of £165,000. If this isn’t achieved she may consider withdrawal

until the market improves.

In the case of X2, this sale was agreed in April 2007 at a figure of

£195,500 and whilst the sale fell through at that time we have made several

reductions and now marketing at £132,500 and the owners would accept

£125,000 making this an overall reduction of 36%. A much greater percentage

reduction than you quoted for the UK and we have loads of examples of other

properties where the fall in price is much greater than the UK average.

The cliché "location, location, location" is all to prevalent when it comes

to house prices in Northern Ireland e.g. a 3 bed 1100 sq ft semi in Mayfair

London cannot be compared to a similar property in Belfast city.

In your previous email you referred to "rated value" which should not be

used relative to "market value", indeed if you were check perhaps the rated

value for the property you currently own against the market value you will

find a noteable difference.

Unfortunately, given today's market it would seem with your budget, you are

placed in an awkward band, unable to achieve purchase on a detached property

at the £150,000 level yet able to buy a semi detached around £125,000."

MY FIST NEARLY WENT THROUGH THE SCREEN

[Malthus]

If I hear rubbish like that once more from an estate agent I swear I will scream down the phone. Market value is what someone is willing to pay for it -- not what will give you a get out of jail card on your mortgage. Grrrrr.

You beat me to it doccy , just to clarify for the stupid

market value has nothing to do with mortgage owed or build cost

on the other point if a vendor can afford to wait for 20 years for the market to get back to 2007 peak prices fair enough , but if the three d's strike prepare to find out the market price .

[Ride_on]

..

If this isn’t achieved she may consider withdrawal

until the market improves.

..

The cliché "location, location, location" is all to prevalent when it comes

to house prices in Northern Ireland e.g. a 3 bed 1100 sq ft semi in Mayfair

London cannot be compared to a similar property in Belfast city.

..

In your previous email you referred to "rated value" which should not be

used relative to "market value", indeed if you were check perhaps the rated

value for the property you currently own against the market value you will

find a noteable difference.

..

You couldn't make it up could you, they think you are as stupid as they are. They even say ' "rated value" which should not be used relative to "market value"' which is exactly wrong, you CAN use it RELATIVE to market value (roughly).

In the first example I think alot of people, often older women, were downsizing to fund holidays and cars, which is fine, but alot of them will be too old to enjoy the money by the time the 'market improves'. These are the people that rising house prices really benefit, as they get more money the higher prices are, while the rest of us get less house for the same price increase as prices rise. However they can still get their difference now, they just have to sell first, rent for a while then buy to make nearly as much money. If only they knew.

[BelfastVI]

Again have been having a wee look again in midulster this week but nothing much seems to be changing.

Was emailing one of the estate agents in the area about certain properties and there prices being way over priced.

I recieved the following reply

"Hi

You referred to the property in X1 this property was reduced from

£175,000 to £169,000 a reduction of approx 3.4% in this case as with several

other vendors there is a mortgage involved and vendors cannot sell below

what they need to clear their mortgage. In this case the seller may settle

at a level of £165,000. If this isn’t achieved she may consider withdrawal

until the market improves.

In the case of X2, this sale was agreed in April 2007 at a figure of

£195,500 and whilst the sale fell through at that time we have made several

reductions and now marketing at £132,500 and the owners would accept

£125,000 making this an overall reduction of 36%. A much greater percentage

reduction than you quoted for the UK and we have loads of examples of other

properties where the fall in price is much greater than the UK average.

The cliché "location, location, location" is all to prevalent when it comes

to house prices in Northern Ireland e.g. a 3 bed 1100 sq ft semi in Mayfair

London cannot be compared to a similar property in Belfast city.

In your previous email you referred to "rated value" which should not be

used relative to "market value", indeed if you were check perhaps the rated

value for the property you currently own against the market value you will

find a noteable difference.

Unfortunately, given today's market it would seem with your budget, you are

placed in an awkward band, unable to achieve purchase on a detached property

at the £150,000 level yet able to buy a semi detached around £125,000."

MY FIST NEARLY WENT THROUGH THE SCREEN

We all want a bargain, nothing wrong with that. But there is no point is getting angry with a vender just because they don't wish to sell at the price you think they should. You may believe they are misguided and, in many cases you may be right. But it is the vendor's decision at what price they wish to dispose of their house. This is often set by the level of debt against the property. You are correct in saying that the level of debt has nothing to do with the market value of the property but the vendor may not be interested in that. They may simply be saying 'I will sell if I can clear my debt. If not I will stay put'. They are perfectly entitled to have this view and one you may adopt yourself if in the same position in ten years time.

I am just saying this as I see so many posts here referring to people as idiots etc (not in your case) just because they won't lower prices. Some people have a price at which any lower they will not sell at. Not everybody is a distressed seller As time goes on and they see that this is not going to fix itself any time soon, they may reconsider. If they don't it doesn't make them an idiot or stupid.

If someone was thinking of trading in their car at the moment they may be shocked to find what second hand cars are going for. Whilst the new price may also have dropped they may decide not to change and stay with the one they have as they believe it is just too good a car to let go for the trade in price offered. You may think they are such a fool for not accepting the market price for his car. You may get so angry and want to hit the screen is the salesman emails you saying the guy was hoping to at least cover the loan he had against it. He may just shrug and decide he did'nt need to change after all.

We all need to relax more.

[BelfastVI]

You couldn't make it up could you, they think you are as stupid as they are. They even say ' "rated value" which should not be used relative to "market value"' which is exactly wrong, you CAN use it RELATIVE to market value (roughly).

In the first example I think alot of people, often older women, were downsizing to fund holidays and cars, which is fine, but alot of them will be too old to enjoy the money by the time the 'market improves'. These are the people that rising house prices really benefit, as they get more money the higher prices are, while the rest of us get less house for the same price increase as prices rise. However they can still get their difference now, they just have to sell first, rent for a while then buy to make nearly as much money. If only they knew.

We all believe EA are slimy and don't really have a profession. We don't respect their opinion of individual house prices or the market in general. (Actually this is my view too) So what if they are members of the RICS or whatever it is. They have a vested interest in it all.

The Holy Rateable Values, from Jan 2005. Well ofcourse they are a true reflection of the value of a property at that time. They are tipple rated, 100% guaranteed, undisputed, values set in stone by local Valuers. All experts in the field. Who, wait a minute. Na couldn't be the same people surly!

[Ride_on]

We all believe EA are slimy and don't really have a profession. We don't respect their opinion of individual house prices or the market in general. (Actually this is my view too) So what if they are members of the RICS or whatever it is. They have a vested interest in it all.

The Holy Rateable Values, from Jan 2005. Well ofcourse they are a true reflection of the value of a property at that time. They are tipple rated, 100% guaranteed, undisputed, values set in stone by local Valuers. All experts in the field. Who, wait a minute. Na couldn't be the same people surly!

You're a bit grumpy today!

I wasn't having a go a all EAs just this one. I also believe the quote someone uses as their signature on HPC about being a professional, EAs are professional market monitors, but they have no ability to predict, so I am happy with their valuation contributions to DCV. I also jammed in the word 'roughly' with regard to DCV, its not holy just bloody useful.

The stupidity quote was aimed at the EA email author, as he completely misunderstood how DVC was being used, and thinks the OP was saying houses should be sold at DCV (which he might, but not in relation to current value discussions).

Of the old lady example, of course people are entitled to do what they want, its a free country. I am also entitled to criticise them if what they are doing is against what they need. They may well want to sell their house for £400K, and buy a smaller one for £300K, but if they sell at £300K and buy at £200K its the same thing isn't it, and if they wait longer the difference becomes alot harder to get.

Fair enough if people don't 'need' to sell and can't clear their mortgage, then it might be difficult to move and impossible to upgrade, they are just wasting alot of peoples time, but they are entitled to do so. Most likely they made the wrong decision to buy in the first place. I don't think the OP was angry with the seller/vendor, just the EA for telling him he should buy what he can afford at the prices they are selling at, not what he wants and thinks he could afford. I was very angry once with a Vet, when I questioned the reasonableness of a bill for £100 for a cat with minor ear mites, several 2minute sessions had occurred to check progress, in reply he said 'if you have trouble paying we have very good pet insurance'. I didn't go back.

Please explain how I have been unfair. Perhaps your VI perspective blinded you to what was actually being said.

[lefthand]

I don't think the OP was angry with the seller/vendor, just the EA for telling him he should buy what he can afford at the prices they are selling at, not what he wants and thinks he could afford.

That is exactly why i was annoyed.

I have no problem with people who have mortgage committments or who can afford to wait things out.

It just sometimes annoys the life out of you but i suppose i should be happy i have a job and didn't buy a house.