To cringe at the British mentality on the property market?

[GinDaddyRedux]

N.B full disclosure I am British, and a homeowner. before anyone questions!

I've read a number of articles online, and a number of posts on here, about the property market after easing of the COVID-19 lockdown. Some of them talking about a drop of 7%, some of 20%. Goodness only knows what's accurate here.

This wasn't the thing that grated on me though. It was the bitter, nasty comments on one newspaper that "young first time buyers are insulting if they offer 10% below asking. They're usually the sort who can't manage money anyway." Or "just because you ask for a discount doesn't mean you're going to get one! Greedy! I worked hard for my investment!!" etc. One even went as far to say "never, ever lower your price for anyone. People who ask are taking the piss."

AIBU to feel the whole mentality around housing is what is so wrong here?

The belief that house prices must, and should, inexorably rise no matter what the economic or social circumstances of the UK, just because millions of Brits have ties themselves up in that dream and want a slice of it?

Surely where we should be is a situation whereby if you need to move, you move. Obviously if you can ride out a crisis like this and have the space, great. But a house is a dwelling first, an investment second as far as I see it.

Therefore if first time buyers want to buy something this year, and make an offer that reflects their reality, why is it insulting or cheeky? Estate agents are legally obliged to put them forward. So. Why the "emotion" as if they are robbing someone's pension pot?

It's because I firmly believe too many people have tied up some of their hopes and self worth in housing. It's "insulting" and "cheeky" for someone to offer lower than asking price, yet we don't think twice about haggling the sticker price on a new car. Granted, a new vehicle isn't imbued with years of memories. Yet there are people who treat it like a personal insult.

AIBU to think some people need to accept they won't get the heady sale prices of 2016/2017, if you need to sell, you just sell. No one is being "cheeky" by asking to buy it at a price they consider reasonable.

But it's the method of buying. You make an offer, you can be gazumped, so you, if you like the property, probably vere towards a higher figure to try to ensure it is your offer that get's it. Also chains fall through, money is wasted on surveys etc then chain fall in.
In Scotland you can't be gazumped. If your offer is accepted it is accepted legally. There can be a situation of sealed bids if several are after it but once that's accepted that's it.

Goaty, there is a market price which is set by demand and supply for a type of house in a particular location, but an individual house might sell for more or less than that, given the willingness of the buyer and seller for that particular house to pay and accept a certain amount. For a particular house, the price isn't fixed. The seller might think their house is worth X based on other sales in the area and adjusted for individual features of their house. The buyer might think differently and offer less. And then the seller has to decide to accept or decline. Sellers frequently accept less than they had hoped for, or even believed they would accept. Although a general range is set by the overall market, the individual price of an individual house is determined by the buyers and seller for that particular house.....it's why you see different sold prices for almost identical houses sold at the same time.

Some sellers will accept a lower price because they really need to move fast, because they've seen a house they want to buy and fear losing it, because they are under pressure to sell from their lender or an ex-spouse, or to move in time for a school place, or because they don't realise they might be able to get more, or they are tired of being on the market, or hate keeping their house tidy for viewers and just want to be done with it. Others with an identical house hold out for a higher offer (which may or may not come) because they are in no hurry to sell, strongly believe it is worth a certain amount, have their eye on a house which means they need to a Chiefs a certain orice in their sale to secure it, have no idea about the local realities of the housing market etc etc.

And buyers will offer different amounts too. Some love the house so much they will pay whatever is asked because they love it and can afford it. Others have a buyer on their own property chomping at the bit to exchange and are under pressure, some are told by estate agents that lots of people are interested and so offer more, some hate to negotiate and so offer asking price or close to it. And then there are others who offer much lower because that is the maximum they can afford, they think it really is what it's worth, they don't need to buy right now or they don't need to buy that particular house and so are just seeing if the offer might be acceptable, but won't be too worried if it's rejected, they think house prices are falling and don't want to lose out or find themselves in negative equity, they are investors always looking for a good price and someone who has to accept a good price etc etc.

There is no fixed price. There is no wrong or right. It's a negotiation and should be seen as that and people should try to remove personal feelings from it and not see an offer made as a personal insult to them or their house, but calmly appraise it in light if their situation and simply accept or decline or suggest some middle ground which might be acceptable.

I think you’re probably just reading poor journalism.

Among everyone I know, housing - buying, selling or renting - is just another market. The price agreed is what the market will stand and anything is only worth what someone will pay for it.

Buyers can ask for discounts but not expect them. Sellers can set prices but equally not get them.

Hi @WombatChocolate

That's an excellent explanation. But the original post was about sellers who simply refuse to accept that the market has dropped, and are personally insulted and affronted by offers that reflect its current state. In which case they simply won't sell the thing!

You're right in that it's remotely possible that if they hold out for long enough and their house is sufficiently unique then someone may turn up with enough money not to care. But if I were a buyer I don't think I'd be wasting any energy trying to solve the vendors' psychological problems, and I certainly wouldn't be wasting any money by trying to appease their delusions! It's going to be much more worthwhile to be dealing with a counterparty who operates in the real world.

The property market is now nothing more than a legalised Ponzi scheme and has been for the last 15 years or so. If general inflation for things like food had gone up in line with house price inflation over the last 40 years then a loaf of bread would be unaffordable for many. Housing is seen as an investment vehicle or pension pot when it should be viewed as a HOME!

Your absolutely spot on
Housing prices are now (and since 1970s) at a fake ridiculously high amount.
Why because the market is squeezed no social housing restock to keep a balance.

I do have some sympathy with negative equity mortgages tying U to a property BUT if prices go down they do it across the board so the new one should be decreased as well.
Housing before the 70s was thought to be a decent way to not lose money. Since it is really for the hopeful (see TV shows and think they can make a little extra) and the greedy (if you have money to invest its easy pickings).

Sorry ranting there
I feel better now
To sum up
I agree OP

Only the British have this obsession with buying houses. In most European countries renting is much more the norm.

Buying and selling houses really brings out the worst in people. I’m just glad we have our house, where we’ve lived for forty years and the only property market we are likely to get involved with in future is the six foot long and six foot wide one in our churchyard.

My BIL, a real estate broker in the US for over 50 years, once told me, “your home is worth exactly what someone is willing to pay for it.

This may be the wrong thread to ask on but I'd like to ask some advice if I may (and willingly accept being pointed in the right direction should there be a more suited thread).

We have found and fallen in love with a house, in an area we didn't think we'd be able to afford (it's the 'not as nice' area of a nice area IYSWIM), and best of all it doesn't need anything doing to it so we won't have to worry about bank loans for improvements etc or living in a building site for ages with a crawling baby in tow. The house ticks every box, and I could honestly see us living there for a very long time. Our current home is an end terrace in a rubbish area, small yard on back, no parking etc, we bought for cheap as landlord was getting divorced and needed to sell, it needed lots doing to it 4 years ago and even more doing to it now (as for some stupid reason we didn't prioritise the house when we had plenty of disposable income). Can I please have some opinions as to whether we proceed during these uncertain times or wait and see if prices do fall so we aren't trapped in neg eq like I've heard so many awful things about?

If makes it easier, house up for £175000, ours getting valued tomorrow but expecting £105-110k hopefully, giving us the £17k needed deposit and the savings we have left to pay for fees, searches etc.

Yes we are in the North and these figures seem pitiful compared to the 1.2millions etc discussed above, but are about right for 3 bedders in our grim Northern ex mining town

I under priced my house as desperately wanted to get out of it. I do regret now losing £10 to £15k as I sit in my new house with no proper kitchen.

But at the time it made sense and I felt desperate. I actually turned down a £5k higher offer due to longer chain. I went for the no chain buyer.

I was not really desperate, ie could afford the mortgage till the end of the year and it was January and it had multiple offers in days and sold in less than two weeks. I could have just waited but I didn't want to.

For a frugal person like me I'll never be able to work out that feeling I had of "sell this house now! " I sometimes regret it but for me then, at that moment it was the right decision. Money wise it was a very poor decision.

Houses are worth both what others will pay and also what someone will accept.

My daughter wanted to buy a house in a very specific area of our town . Most of the home owners were elderly with many having lived in their lovely detached homes since they were built in 1952 . This was 10 years ago .
A couple of houses came up for sale so we went to view them . One we didn’t like but the other was lovely . Hadn’t been decorated for years and needed a new kitchen. The asking price was £300,000. Dd offered £285,00 which was rejected. She waited another few weeks and another house came up for sale which had been done up from top to bottom . She again offered £285000 and this was accepted.
The first house was an inheritance and they finally accepted £250,000 . They were bonkers to have refused my daughters offer and didn’t benefit from being greedy

And it not only the British who have this obsession with buying a house. Thats British exceptionalism at its best and its just not true when people say this.

Even country I have lived in has been the same.

A village in Africa is the same and every villager wants to buy or build their own house, usually small but they still want to do so nonetheless.

Europe has a more stable rental system generally but home ownership is still much desired.

There is nothing as human as wanting to feel a sense of ownership over where you live.

Japan, China, Jamaica, USA, it's normal to yearn for a home and for most people in most countries, ownership is often the only way to stability.

If your first offer doesn't cause real offence, it was too high.

Nobody has to sell their house.

It always strikes me as odd, that we will haggle over the cost of a house but not our fruit and veg from the market.

It's a myth about Britain buying their homes compared with other Europeans - we're amongst the lowest. Only Sweden, Denmark, Germany and Austria have lower rates of home ownership.

Some people continue to view property as an investment. Property is an asset . If it’s not making you money it’s not an investment .

I meant to write property is a liability not an asset. If it costs you money regardless of what you could or couldn’t sell it for it’s not an investment.

Sorry @Purpletigers, I think you may have got that from the book Rich Dad, Poor Dad, but it's rubbish. Property is an asset.

I don't think anyone is irritated by an offer. A much lower offer is a different story, because it just seems like a waste of time for everyone, and it causes stress to the seller who may be worried about achieving a price in order to move to where they want to move.

We actually got an amount off the house we bought because we were upfront and said 'we love this house and this is everything we can pay, but it's not your asking'. Apparently someone else offered lower and when rejected went up by increments even above our offer. But the sellers were so p*ssed off with their time wasting they sold to us instead!

YABU to pay attention to 'below the line' comments on a newspaper.

People displaying those attitudes are mostly just trying to convince and reassure themselves. They don't want to face losing something they believed, until a few weeks ago, they could rely upon (even if notional, as they weren't going to sell).

It was exactly the same in 2008.

@Purpletigers I get where you’re coming from. Unless you are going to sell your house and live in a tent then of course it’s not really an asset.

There are people who buy houses with the intention of continually selling and moving into more expensive property buy, of course, that inevitably means bigger mortgages. The value of your house is a paper exercise unless you’re selling it and, at the end of the day, either the care home - current fees in excess of £3000 per month anyone? or the government - inheritance tax? will take it off you.

A friend of mine was so determined not to accept a drop of £3k to put right damp noted in the buyers survey that they ended up losing the sale. They had bought their next home already on a bridging loan and because of the lost sale they ended up going bankrupt and losing their other property. It was stubbornness of the highest order and ended up costing them a whole lot more than £3k.

I’ve bought and sold several homes over the years. Some have sold quickly for the asking price, others haven’t and on one occasion I had to take it off the market and wait a year.

I’ve never been offended at offers below the asking price. I’ve refused some and gone with others depending on how the sums work out on the whole process including cost of purchase of the next one.

This is how the property market works.

Renters don't get shat on from the same height in most other European countries, but even then the trope about people not wanting to buy on the continent is outdated. Germany, for example, has seen an increase in homeowning rates to above 50% of the population.

People who read rich dad poor dad then think they know about money and investments are hilarious. You’re literally just parroting the views of one very specific book which was written to sell copies of that book rather than anything else.

Goaty- I got it from experience tbh . Although I do have a copy of rich dad poor dad somewhere . Didn’t teach me anything I didn’t already know.
Anything that doesn’t put money in your pocket isn’t a true asset . You can consider it an asset but the mortgage makes it a liability.