Monday, April 2, 2012

A lesson in orchestrating one’s demise in the race to the bottom.

Four in ten agents say one-third of their homes are over-priced

An astonishing poll of estate agents claims that nearly four in ten believe that property on their books is over-priced. The claim has emerged in a poll of over 200 agents conducted by review site MeetMyAgent. The poll was conducted between March 20 and 24 and claims to show that 38% of agents believe that more than 30% of their stock is over-priced

Posted by sibley's b'stard child @ 09:59 AM (2141 views)
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10 thoughts on “A lesson in orchestrating one’s demise in the race to the bottom.

  • ‘the main reason for sellers not lowering their prices is that they are happy to wait for the offer they want.’

    Vendors have clearly forgotten how markets function, with new money coming in at the bottom. During the last boom a large number of first time buyers never made it on the ladder. These folk are not playing a ‘cat and mouse game’ with vendors, they are just sitting on the side lines out-priced from the market.

    If the estate agent industry is to survive they must react to market forces sooner or face a worsening situation as the years continue to roll on.

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  • Thecountofnowhere says:

    ….and the other 6 lie.

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  • mark wadsworth says:

    Nine-in-ten FTBs say that nine-in-ten houses are overpriced.

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  • “If the estate agent industry is to survive they must react to market forces sooner or face a worsening situation as the years continue to roll on.”

    Or expand their lettings department.

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  • @3 rnr

    If lettings are the way forward for this country, we may break the ownership dream forever.

    My fear with this new model is that younger generations don’t have pensions or houses so when they retire, who will pay the rent?

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  • I’m not saying I like the outcome Will, I’m just passing on comments regularly expressed by EAs on the EAToday site about how they are weathering the lower sales transactions.

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  • “…. so when they retire, who will pay the rent?”

    Maybe they won’t be allowed to retire.

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  • “My fear with this new model is that younger generations don’t have pensions or houses so when they retire, who will pay the rent?”

    There is also the other side of the story – the over borrowed who are racing towards retirement. Yes, the monthly payments are affordable however they will never be able to repay the capital on their loans. Unless the older generation can offload their properties to the unsuspecting younger generation then they are also in a sorry situation in a few years time.

    Recapping, It is a zero sum game, eventually affordability ratios will improve. Low repayment rates will bailout the over indebted for a while, however in the long term they will be no better off.

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  • Rant @ 5

    I take your point (on my high horse today), many agents have turned to renting houses to adapt to this market.

    Renters cannot speculate or borrow to rent, so rent can only then rise in line with real earnings, they may find it impossible to pay extra rent when interest rates start to rise, in which case the landlords will have to take the hit.

    There are many Exeter properties to rent who are reluctant landlords, they have been un-able to sell for many years. They also remain un-let.

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  • mark wadsworth says:

    Will: “[Renters] may find it impossible to pay extra rent when interest rates start to rise, in which case the landlords will have to take the hit.”

    Correct. Rents are set by what tenants are willing and able to pay, landlord’s actual input costs have more or less nothing to do with it. Consider: did landlords drop rents when interest rates fell? Do non-taxpayer landlords charge lower rents than those liable to income tax at 40%? No of course not.

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