Is anyone slowly going mad trying to buy a house?

[tawse57]

Hi,

I have been looking to buy a house for nearly 3 years now since the height of the housing bubble in, so the experts say, early 2007 to mid 2008 depending on where you live in the country.

I live in Wales and the view is that the housing bubble peaked sometime around the early part to middle of 2008.

I have been viewing and looking at houses endlessly since then but, bizarrely, the asking prices now are HIGHER than in 2007 or 2008. In some cases they are much higher. What on earth is going on?

Are people just being very greedy? Or are people simply but greedily falling for high estate agent valuations and then wondering why they get few viewings and no buyers?

Or is it that just so many people are in massive debt that they are adding their credit debt onto the price of their house? Something does not make sense here - houses should be CHEAPER now than at the height of the bubble but people seem to be asking a lot more for their house during this recession than during the housing boom. It does not make sense.

The country is in recession, unemployment is rising and I keep reading in the papers that the banks are bust. I keep listening to David Cameron and Nick Clegg saying that the country almost went bust due to a massive housing and credit bubble fuelled by Labour and the banks when Tony Blair and Gordon Brown were running the country.

So why are house prices so much higher today than they were 3 or 4 years ago.

Some of the estate agents I have got to know well tell me that if they do not over-value a property then one of their competitors will get it on their books. What good does over-valuing do?

I only want to buy a house and had my heart set on moving in by Christmas 2009 at the latest but, at this rate, I won't be in a house till Christmas 2015!

Is anyone else frustrated by this? I just want a nice, smallish 3 bed semi but it seems that I am being asked to pay for a mansion.

T.

noddy

Why???????????????????????

Wanted more money! The house they want is on with the same agent and he advised them to take ours but they said they wanted the asking so i said NO!

ha ha ha ha
I am that is almost hysterical very funny.
Someone slap me!!!!

Thepoweroforangeknickers - I'd have been the same, but we are desperate to move in the area (for DS's school). We didn't exchange today, now it means the DDs will be without a school till after half-term, as we need council tax bill, child benefit bill and all sorts of damn paperwork.

Interesting.......just got 12 separate e-mails from one agent in my in-box. Thought they might have a problem with a virus at first, but no, they are 12 separate properties sent to me. Been coming throughout the afternoon - from an expensive agent. Unusual attention. Sign of difficult times?

That is interesting MLM

Any that you like?

Well, 2 viewings later - both overpriced by £50 - £100K imo - very disappointed. The bungalow has redevelopment potential and already has 2 over the asking price offers from chain buyers (alledgedly). It's not worth even asking price to us so we've decided not to even bother putting in an offer. (Cash, no chain position) so the estate agents can just shoot themselves in the foot!

How are the EA shooting themselves in the foot if they DO have asking price offers?

Seems as if the houses aren't overpriced in that case.

Hi Becaroooooooooooooooooooooo
One looks interesting - rather further west than we were looking at, so commuting costs would rocket. Top end of budget too, so overall would be a bit of a stretch. The others sent are between £550k & £850k!

Is difficult for us - we own a modest house outright and have saved masses over the last umpteen years, but the rise in the market and current asking prices mean we would need to put everything into an extra bedroom/reception/bit more garden. For four bed detached at the moment, I'm looking at £500k (boxy modern, postage stamp garden - just not worth moving for) to £750k (more space, but over the budget). Cambs/Herts/Beds. Everyone seems to be moving up from London bringing their huge equity from the London market. Pretty savvy really.
Odd though - still hundreds of houses on the market for 6+ months. Market very sluggish but some selling which is keeping expectations high.

Think we might just sit tight, invest in some extra storage, and forget about it.

P.S. why the ?

I have had numerous calls in teh last week again with price drops for things I viewed about a month ago.Hang on come October when people are desperate to sell in time for xmas there will be reductions

myron - I feel your frustration. If they do get their chains set up and everyone gets their prices then the dosh will move up the chain and the bungalow will complete for the asking price. Is a tad precarious, but it does happen in some cases, and some people are prepared to wait a long time for it to come together. I still see houses coming back to the market though, even after being SSTC since January.
Is a mad market - some agents pricing very high (+20%) to allow a knock-down on offer value and allow the buyer to feel they have a bit of a deal, and some not as bad but still top end. Is an ass though, as some overpriced places are actually selling at the inflated level (info from friendly agents willing to share - they are pretty amazed). Even with all the information that's available on selling prices etc, some people are just still willing to go all out, which makes it more and more difficult for everyone. Is a minority though, but still there driving up the market.

We will either not buy at all or start making offers on places that just aren't selling, and see where we get to. There are three in our target area we might attempt to offer on, but not terribly tempting considering what we could get further affield (been looking at Austrian Tyrol )

Morning Noddy! Lots of price reductions here too - seems places being marketed at massive starter, then if little-no interest coming down 10% after just a month. Plenty have come down 20% within a 3-6month period (figures approx £50k-£100k) which makes me wonder where the hell 'values' are!!!!!!

I know I am just waiting for one of the ones we actually like to fall in price!Had a 3% under offer refused and they had been on the market more than 6 months with no offer!

Well, what can you do!! Perhaps they'll come back to you....eventually.

I saw a nice one last year (!) which had been bought a few years ago then largely extended - some of it good e.g. bedroom space (4 from 3), but ground floor flow compromised - small & dated kitchen, no reception hall, just come into tiny space with a cupboard and stairs etc etc. plus good size garden but on a hillside going up (where does all the rain flow to??). In a hamlet. Need car for everything. Nice enough. Put out feelers but understood they wanting very close to what they were asking.....
Didn't sell. Took off the market. Put in 'new' kitchen units (cream, black worktops ) and cheap shower room upstairs. Came back on the market in the Spring with an acquaintance EA (reassuringly expensive agency) for £30k more than last time - three quarters of a million
Still not selling....................

I am such a market bore
Going to get a life now & take my children out in the sunshine........

Admittedly, we are looking at prime locations so I doubt whether bargains are to be had. However, we know that some agents are stretching the truth (understatement). We offered on one house back in spring at 10% under as a cash buyer cos it needed extensive updating. The agent told us that they had one other offer that was higher than ours (but not chain and not asking price). We decided that we needed to look at other houses so didn't proceed. We surmised that the other offer was accepted because it was taken off the market SSTC that same day. It has completed recently at asking price (to my surpise) and I know vaguely through the grapevine who bought it. They would be really peeved to know that the only other offer was from us at 10% under and that we subsequently withdrew the offer so they had zero competition. I know the agent lied - they thought that they were competing with a cash offer slightly below asking price so they upped it to asking price! So I am cynical.....wrt to the tactics employed by some (not all) estate agents.

MLM hah! was meant to be a but I did the wrong one!

I know what you mean re: stretching yourself for another bedroom and a larger garden...there is a non descript, boxy, 4 bed detached with a double garage, average size garden here on for £400k...we are in the east mids!!! not the SE!!!...madness!

Luckily we like it here, albeit the house is on the small side. Part of me thinks..would it be so awful if we rented long term??? (not neccessarily in this house, but definately in this area) and tried to save and add to our deposit/house money? Not sure if its an option or if anyone has any experience of doing that???

Dh would - ideally - like to retire early (say 55) which means 16 years more at work (he has a works pension) and do I wonder how much we could - feasibly - save in that time

I think you would be fine renting for a couple of years but long term, say five or ten years, then house prices will rise again.

really? I'd be surprised if prices went up again on such a short timescale as that. Incomes are going to be squeezed for a long time so even if the market bottoms out in, say, 5 years, any climbs after that will be very slow.

They will be slow, but climb they will.

Tyler - funny you should advise buying off dead people.

The house we purchased a few months ago was a deceased estate, proceeds from which were to be divided up between the children.

It had been under offer for almost 2 years, had fallen through twice (same buyer, their own house sale fell through twice) and the second time is when we spotted it, saw it on the first day it was back on the market and offered around 8% less within 2 days as cash buyers. They agreed solely on the condition that we exchanged contract as quickly as possible. They weren't concerned about when settlement would be, but didn't want us backing out!!!

They were chain free, we were chain free, and we were able to proceed quickly. I've been keeping an eye on the market (doing major renovations and making sure we don't invest more in the house than we'll get back) and I'm quite relieved we found this, as the other houses are seriously WAY higher than 2007/8 prices.

JillySnooper, you seem convinced that house prices will rise again. There is no guarantee that this will happen - take Japan as an example: House prices there are roughly half what they were in 1989. 22 years ago! And just as here, they have had very low interest rates and are a small crowded island. The fact is, insane levels of lending are the only reason house prices were pushed so high; levels of lending that almost brought the world to economic collapse and are unlikely to be repeated for several generations if at all. I'm not saying they won't rise again, of course they will. But knowing your house is back to the 2007 "value" won't be much consolation in 2050 when a loaf of bread costs a tenner.
With regards to estate agents shooting themselves in the foot. Take it from someone who worked in the industry for quite some time (past tense, fortunately), it was fairly common practise to invent 'ghost' buyers; this creates pressure on the real buyer and often results in a higher offer. This works OK in a rising market as if you scare the buyer away, another will shortly be along to take their place. However, many EAs are one-trick ponies and aren't able to adapt to the current market conditions - hence why they still rely on outdated sales techniques (these will be the first ones to the job centre).
Finally - shocked at the generosity of some of the offers mentioned. Given the average reduction is roughly 8% off asking, there must be some buyers getting real bargains out there!!

Don't get me started on lying cheating bastards agents. Too many examples. When you are looking to buy you have to be as hard-nosed as they are. Sadly the majority of the population just roll over and open their the banks' wallets.

Jillysnooper - you seem very sure of your assertion. Why? Insider info?

Well I doubt prices will rise all that much. The new rules being introduced for banks as to how much cash they have to hold for their mortgages means that mortgages will become even harder to get, and interest rates will quite likely go up.

I think very long tern they have to go up. Demand will outstrip supply, more divorces, more pressure on housing stock. I don;t think they'll boom like they did but they will crawl upwards.