Sunday, November 11, 2007
Properties are hard to sell
Will the value of your property fall next year?
"If there is the slightest problem with a property, people will walk away. The only exception is with very desirable properties, which are still selling well and seeing competitive bidding. Properties spoiled in any way, by say road noise, are very hard to sell."
Posted by confused76 @ 11:08 AM (1261 views)
13 thoughts on “Properties are hard to sell”
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Topher Bear says:
[quote]However, there is a big potential derailer to this scenario and that is supply. If we fail to resupply the market, prices may rise sharply again. We are still looking down the barrel of a gun because of the mismatch between supply and demand[/quote]
As stated at the end of this article, prices could shoot up again if supply is not increased.
Hmm. The question I have for Mr Barnes is “Where will the money for this sharp rise in prices again come from?” Since banks will be tightening up on lending, the era of cheap and easy credit is over. The reason that prices have risen higher and longer than anyone could have imagined is primarily due to the banks willingness to lend to almost any tom dick and harry (It wouldn’t surprise to find that they also lent to the homeless on the streets during this hedonistic debt party!). Prices cannot rise further unless there is the money to back up those riss, and sice wages have not risen significantly (running at around 4% for a number of years now, officially), then all that extra money could only have come from the banks. Now with that particular tap turned off, price rises have no backer.
Where supply is an issue, people can only buy if they can get the mortgage, so they will have to stay renting. In this case Landlords may not find themselves with a mortgage they cannot service due to lack of rent and prices may hold. In other areas where supply is not an issue (and there ar plently of these around the country, whatever you may hear from government…anyone living in the Northern Regions could tell you that!) Then prices could very well fall substantially, as not all BTL will have tenants, First Time Buyers won’t buy until the prices reach a value which co-incides what the banks will lend (and thats if they don’t hold off while prices are falling, a classic deflationary cycle), then there are less renters and then more BTL landlords will need to sell or be repossesed, and the market will fall until a more normal playing field level is reached (and below, as that is what happens in a bust!)
Sold My Soul To The Never Never Never says:
Bailey – “It took a recession for House Prices to fall in the 1990’s”. I don’t particularly remember a recession in London in 1989 and house prices fell dramatically – I should know – I was trying to sell one from March 1989 until December 1989 and it dropped by 15%. Don’t believe the V.I.’s here – one mentioned a catalyst and the catalyst at that time was Nigel Lawson and him withdrawing MIRAS relief for individuals in Aug 1988. The catalyst is here now – the Credit Crunch. It was the house price falls that created the recession – not the other way round. If people have to stop consuming unnecessarily because they can’t get access to easy money then shops and businesses will fold and the spiral will continue.
Davros says:
Ask a load of people with vested interests whether prices will fall and they say no. Top journalism.
paul says:
A: Yes.
Iti says:
All of the comments on the “have your say” part of that article have now disappered..lol. Guess there were too many people saying what a load of VI tosh the article is.
Realist says:
I can’t wait to see Yolande Barnes finding excuses to justify her wildly optimistic forecasts. I don’t know why people ask for measured opinions from estate agents and mortgage lenders on this subject!
Maihem says:
The problem here for the housing market is that people buying as an investment don’t worry about quality of life, they’re going to lie back and think of money. But when the market slows they have to sell to buy-to-settle buyers who have a different opinion of the value of a property. It’s like a game of pass-the-parcel where the parcel contains a bankruptcy ruling. And the music is about to stop – so who owns a buy-to-resell property at the moment? Not me.
Anyone who manages to sell right now is very lucky and probably very happy and very rich. But all those who don’t… oh dear.
inbreda says:
“If there is the slightest problem with a property,…”
Like ….
let’s say ….
as an example…
it’s value is going to drop 50% in hte next 2 years?
new_order says:
I guess it all adds up to the yes/no decision. Such as it is next to a motorway, opposite an industrial estate, 2 streets from a crack house and it is going for £200,000. Sorry for those of you living in the south.
yorkshireman says:
There is a very nice house down our lane. It has beautiful panoramic views up into the Dales and is in a very nice village location. There is no motorway, main road, crack house, brothel , factory nor an estate agents office in the vicinity to detract. It has been on the market for 4 months and the asking price has fallen by 12%. It is not selling because it is still overpriced. It will not sell in the foreseeable future, because local prices are falling and will continue to do so. Can I have a job at the Times please or would the truth have to become the first casualty ?
Icarus says:
All the mouthpieces of vested interests quoted in the article are still talking of miniscule falls in house prices when there is evidence that real declines (even on far fewer deals) are much bigger than the 0.5% etc. they are citing. The Chairman of DTZ (International property valuers) told a RICS conference last week that ‘we are seeing transactions being done and we know that deals are 10% down on June values’. (See this website’s 6th November archive from a Property Week article.)
Ihopeitgoeswithabang says:
Quote:
“Properties spoiled in any way, by say road noise, are very hard to sell”
Ah yes, now that would be common sense and value for money creeping back into the equation. How silly of people buying a house to consider such things eh???!!
Van Hoogstraten says:
Estate Agents’s arguments about the lack of properties on the market keeping prices from falling is akin to Turkeys voting for xmas
Their parasitical livelihoods depend on volumes through the market – if these decline considerably, then so will the supply of estate agents
I think there may be a major tactical switch by Estate Agents to start talking down the market “sell your property now – 6 months later it will have declined by 20% if you don’t get a move on”