Monday, March 24, 2008

Rightmove: prices up +0.8% in Feb

Sellers remain in denial

Home sellers pushed up asking prices for property last month, despite a significant slowdown in the housing market and a lending squeeze by the major banks, according to Rightmove. People putting their homes on the market for the first time raised their average asking prices last month to £239,655, an increase of 0.8% (£1,799) on January. Rightmove said sellers were deluding themselves that buyers were prepared to pay high prices at a time of heightened anxiety. It said sellers were "ignoring market reality" when the credit crunch was already cutting deep into the number of sales and consistently dragging down sale prices. The average number of unsold properties on estate agents books also rose.

Posted by little professor @ 01:41 AM (2235 views)
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28 thoughts on “Rightmove: prices up +0.8% in Feb

  • Isn`t this like a game of Poker ? You`ve got a rubbish hand, but you bet all of your remaining chips.

    I`ve been watching a few properties on Rightmove, and the only way seems to be down for prices. This report shows how ignorant/greedy vendors are.

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  • I heard the head (spokesperson?) of the NAEA on Radio 4 this morning. He was saying that in the last 3-4 weeks 30% of mortgage products have been withdrawn … oh dear oh dear…

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  • The ‘spring bounce’ is not going to happen and summer sales are usually slow, so the denial phase will most likely continue until the autumn. By then there should be a glut of ex-BTL properties up for sale. Vendors will then wake up to reality.

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  • in the report the final sentence of the report is excellent….

    Shipside adds: “if sellers were to price more realistically at the same time as lenders were able to normalize lending criteria, we could see a speedier harmonization of seller expectations and buyer affordability. Until then, there will be a lot of sellers who can’t sell and a lot of buyers who can’t buy, and everyone sitting on their hands.”

    I think the key word are “price realistically” and “buyer affordability” – two thing that have been sorely missing over the last few years.

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  • 🙂 just thought i would pop in to say told you so once more….oh look prices went up! thats another few thousand i have gained, keep dreaming fools……

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  • I think there are loads more sellers in the market, and hence the sellers think this the final time they can sell out and make money.

    You must remember this is based on ASKING PRICE which means nothing. The selling price could be 10-20% less and has always been even in boom years.

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  • Greytornado says:

    Three factors will always continue to put houses on to the market – Death,Divorce & Debt. From what I see in the local paper and the Estate Agents windows and the for sale boards in the streets, it looks as though a lot of houses aren’t shifting and some have been for sale for many months and this is in a nice place to live – the Isle of Wight. Eventually, we will all get our heads around the fact that a big downwards house value correction is taking place and that a lot of Estate Agents will go to the wall in the process. Come the next election, when all our houses have dropped in value by a third, that nasty Mr PotatoHead and The Badger will justly get the blame and the fury of the voters will be revealed………………………….

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  • new user 2007 says:

    Many get confused on Asking versus Actual and VIs like that…

    If there is an Actual price of 300k at the beginning of the year, and an Asking price of 400k at the end, then if it sells for 350k, the price is still 17% higher. Sadly, there are many imbeciles who think they got a bargain.

    To make it worse, estate agents have been trying their luck recently and put an Asking price of 420k on the same house, so buyers can then kid themsevles when they get a discount.

    Luckily, the same VIs that made this happen are now cutting off the funding to these people i.e. the ones who get conned by VIs, and so the ability to offer silly amounts is gone.

    An estate agent spent 54 mins telling me how busy his office was and hwo good the economy was. He also said prices are not going down. I ended it with”if you are that busy how come you had an hour to chat with me?:)

    A silence followed:) I registered a few years ago and stopped looking as the market continued to get sillier and sillier. Suddenly the estate agens I registered with and ignored me, are emailing and calling me.

    David Smith has his “skip” index. How about a For Sale and To Let sign index. On the route I take these signs have gone from one random one every so often to a total of 17 since Xmas…

    …this is not seasonal, as I have taken this route for six years and never seen this trend. This is just the beginning. Asking prices have indeed finally started falling in my area, for the first time since August.

    As for the comments from Rightmove. VIs are getting frustrated as no salea re occuring and so their commissions are gone. They created monsters (sellers), and now they are desperate to reverse expectations.

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  • What some contributors to this site underestimate is the psychology of someone who has been told for 10 years that there property has rocketed in value and then placing that year on year expectation against a couple of months bad mainstream publicity about the housing market which is even then clouded by the Stuart Laws, David Smiths/Times Property supplements of this world telling them all will be ok. Not surprising that a majority – who never go near a site like this – refuse to put there hands up in surrender and lower their prices significantly. As long as unemployment remains low by historic standards and the number of distress sales is kept maneagable it is difficult to see quick price corrections of the type demanded here.

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  • I reckon we are still a little bit early in the cycle to see too many private sellers actually waking up to the reality and dropping there prices.They are all still believing the VI spin.I have noticed a couple of properties in the chelmsford area recently,one was sold at auction,a 3 bed semi for £241k (similar properties in the area are 280-290k) and a 2 bed terrace that i believe is a repossesion has been on the market for a few weeks at 185k (similar properties in the area are 200-215k).i believe these examples are a true indication of the direction of house prices.Your average seller and estate agent are still in denial.

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  • Perhaps these are the sellers who “do not need to sell”, whatever that means. How often do you try and sell something you want to hang on to? It’s the old greed story. Because they were told their house is worth some extravagant figure, they believe it is enshrined in fundamental law. But as soon as the EAs find stuff isn’t selling, they will be quick to push sellers to drop the price. The old EA advice will be clearer than ever: Buy now before prices go higher: Sell now before prices fall. EAs don’t act for sellers, they act for themselves – turnover is all that matters.

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  • I reckon we are still a little bit early in the cycle to see too many private sellers actually waking up to the reality and dropping there prices.

    Sellers still think the good times are going to return….sadly they are wrong.

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  • Good to see greenbay is back with the usual abuse.Are you back at work today in your estate agents office?i guess you have plenty of time on your hands today as i doubt there are many punters.You obviously have not read the article, so perhaps i can spell it out to you.These are A-S-K-I-N-G Prices.They mean nothing to the actual selling price which are in decline.The only fools i can see are the sellers/EA’s in denial.The choice now for the fools still left holding the property chips are sell now at -10% or sell in 2009 at -25%.Or sell in 2010/2011 for -50%?Wake up to the REALITY.The smart money got out of property in 2005-2007.

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  • Greenbay, I have a pair of used jeans (Levi’s 501 slightly torn) that I’m selling. I’m asking £5500 for them. Better hurry as the price has gone up from £5000 a year ago. That’s 10%!!! At this rate they will be worth 10 grand in a few years time. Soon I too will be able to retire. See you at the golf club!

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  • 🙂 just thought i would pop in to say told you so once more….oh look prices went up! thats another few thousand i have gained, keep dreaming fools……

    Yes, but have to actually tried to sell anything?

    I think you will find it very difficult…

    But it’s good to see you are still the same ignorant and greedy pig that you have always been.

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  • Next month, rightmove’s YoY asking price hits 0% (or maybe only goes as far as 1%)
    http://www.housepricecrash.co.uk/indices-rightmove-national.php#graph

    April 2007 had an unusual 3.6% rise in asking prices according to their counting and that will roll off the headline next month.
    With time-to-sell growing, this figure wouldn’t manifest itself in the acadametrics numbers for 6 months but confidence will be shot to pieces by then so maybe we’ll see some effects before as sellers are more willing to drop their prices. Estate agents will be very happy with that result as stock starts moving again.

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  • Mytimeisnigh says:

    Greenbay just doesn’t get it….Actual prices instead of asking prices were down by ten percent.

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  • Does anybody else think this is an odd occurrence:

    Mar 08 £239,655 +0.80
    Feb 08 £237,856 +3.20
    Jan 08 £230,428 -0.80
    Dec 07 £232,396 -3.20

    Still overall a downward trend (-0.1%) but… strange numbers to turn out – and why, for pity’s sake, do they put that extra zero on the end. They’re not even to the nearest 0.1 percentage point let alone 0.01

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  • Greenbay is make believe like the Bucks Fizz song and errrrrm the property ‘market’ so beloved by many…

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  • @Ijjhall

    I partly agree with what you are saying. Most sellers will be very reluctant to take a perceived loss and will hold if they afford to do so. That said, the smarter sellers will accept modest reductions to get rid of their property because even the mainstream media are reporting problems now.

    “number of distress sales is kept maneagable”

    I just don’t see that happening. I think our banking system is in deep trouble and the easy mortgages we’ve seen in the past will not come back for a long time (ever?). Without the same amount credit to buy the sellers must reduce prices. Right now I thinks it’s a stalemate with lots of buyers willing to wait a few years. In the end, the sellers will have to drop peices a bit but it will not be a quick process at first.

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  • @hpwatcher

    Ignore Greenbay. He’s just a troll.

    I don’t know if you saw Greenbay’s early posting in this site – they were amazingly bad. Most if his arguments were easily picked apart and then we discovered that he had been cut and pasting Estate Agents promotional materials and posting them as his own (LOL). Over time, he has noted some of the more reasonable arguments and adopted them as his own – copying other people’s ideas or just random drive-by insult postings are his thing.

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  • it_is_going_with_a_bang says:

    Short term blip house price ‘asking’ prices is exactly what will happen from time to time.
    There is no reason why anyone selling should not test the market – especially if they are not being forced to sell.
    However, asking prices means nothing as a snapshot since I doubt any house sales are being completed without a negotiated drop from the fairly tale price.

    The really positive edge to this sword is that it means house price sales will slow and estate agents will get shafted and have no wages.
    Fantastic news.

    I can wait for the drop if it means EA going through hell in the meantime 🙂

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  • montesquieu says:

    Easter Weekend has come and gone and my landlord got exactly … 0 viewers. That’s where fantasy asking prices get you. According to property snake today marks 280 days on the market .. nine months, and counting.

    To be fair he’s not in complete denial – his latest offer to me is more than 20% off his initial asking price. Only another 10% and it’s down to what he paid for it in 2002. The estate agent however remains in denial and the published asking price remains what he dropped to last September.

    I wonder when motivation to drop to whatever it takes to make a sale will overcome his willingness to keep paying £600 a month on top of what I’m giving him in rent just to service the mortgage …. there’s many more where he came from too.

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  • new user 2007 says:

    Greenbay…Why do you bother?

    Each time you come here you embarrass yourself with an incredible lack of knowledge. Lying is a terrible trait. Nobody here denies a pyramid scheme exists. But you know its different this time, always is:) Thanks.

    As for a rise in ASKING prices going up. Your ignorance on not understanding the difference between that and ACTUAL prices is clear. I posted above before your comment went up, but I hope it helps your sort.

    As you are quite simple…you can put each of your 1mn terraced houses (or the banks’) on for £1m each. That is the ASKING price. Will you ACTUALLY get that price? Goodluck with that.

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  • I’ve just increased the asking price on my buy to let by a million pounds and I’ve become a millionaire overnight! Hooray!

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  • Fallin-offa-kliff . . . . . . . . says:

    In swansea, where I live, there has been a glutt of new build properties flooding the market, which are marketed at fuller than full value – builders hoping to cash in before meltdown. I think this could be a factor that is contributing to rightmove’s increase in asking prices. Private properties that have been on the market for a while are dropping by around 10%.

    Hold tight, it won’t be long!

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  • Prices up, just as I expected, come the end of summer, the delusion will stop.

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  • A lesson for Greenbay about average asking prices:

    3 properties on the market, each offered at £100,000. One owner gets real and drops the price to £85k. Other 2 owners see average asking price down 5% and are unhappy. Cheaper property sells and average asking price goes back to £100k. Other 2 owners see average asking price rise by 5.26% and are delighted.

    Alternatively, consider the impact on the average price of me putting my 300 room, 2500 acre central London estate on the market. That would make Greenbay a fortune 😉

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