Feeling really hacked off and disillusioned with our ongoing attempts to move. Opinions and a wwyd in this situation would be appreciated.
Brief background (I'll try). Bought 2 bed flat in SE London in 2007 for just under £250k stamp duty mark. Made a lot of improvements, had DD in 2009 and started thinking about trying to upsize beginning of last year, so I've been keeping an eye on the market since then. A three bed period semi in an ok location for schools could be easily found for £350-375k. Over the summer we saw a number of agents who all said we could achieve c. £270k for our flat which would make a move just about doable, so we went on the market at £280k. Perhaps predictably, even though we had a lot of viewings and a couple of offers within a fortnight, they were all at £250k. We couldn't at that time afford to move whilst accepting that, so thought of other options.
I should probably add that school applications had become a priority, so we looked into renting out our place to rent a house near a school, and had got to the stage of having a tenant for ours and a deposit on our place to rent, when we informed our mortgage company (we had taken advice from our IFA prior to this who said it was all fine) who then wanted to more than double our rate, which made the whole thing very financially precarious so we had to pull out. It was during this time I fell pg with DC2.
Our plan was then to save as much as possible to we could afford to sell at £250k. We had been thinking about going on the market this spring, and keeping fingers crossed for school waiting lists if we didn't get into any (its not guaranteed where we are due to massive oversubscription int the borough, so high chance we may be just too far away from any of the numerous surrounding schools).
However during this time (I.e six months) the price of houses going on the market seems to have skyrocketed - houses that would have been listed comfortably under £400k are now on for £425k which is pushing mortgage payments to an uncomfortable level for us (there was a rash of new properties on Rightmove today prompting this post).
The price of flats (prob due to stamp duty) has remained static and any priced too high are sitting on the market. I can't believe that the higher house prices are realistic in any way but I also don't believe someone listing for £425 would accept a £50k reduction in the asking price. To demonstrate, there is a row of modern town houses in a not so great location. One was on the market for a while at £325k (already a price drop) and eventually sold before Christmas (obv I don't know what it actually sold for). The next door property (no discernible difference) has gone on at £420k! They have just swapped agencies at same price, so are obviously holding out.
Just feel very glum over this, especially now space is going to become a real issue with DC2. I would be happy to sit it out and save more for another six months (we are luckily able to save a good amount each month at the moment due to low mortgage costs in current place), but my fear is the gap between what we can sell and buy for will widen even further, DD will also have started school and so the move becomes even more complicated.
Any thoughts/advice? Is our only option to leave the area we love(or commit to living in a tiny space with 2 dc)? We have also been looking to move to the south woodford/wanstead area, but the situation is the same there with house prices, and the school oversubscription even worse, so I can't see how that is possible.
Apologies for the lengthy rant, I just feel so trapped and unsure what we should be doing.
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Do asking prices in any way reflect what houses are being sold for?
7 replies
LittlePickleHead · 25/01/2013 10:55
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