Page 5 | Current property market - how much over asking price are you offering/accepting?

erhsla14 · 2022-04-21T21:41:23+00:00

Also where in the UK are you based? Just trying to get a feeler for what is happening out there currently. Possibly also trying to make myself feel better for making what feels like a really significant over asking price offer but could just be due to FTB nerves etc. With the current property prices/market, it makes me wonder if prices are bound to crash and if I'll be making a loss whenever it is we sell down the line...

lemon88 · 27/04/2022 22:45

We're in the south east, just had an offer of 630k accepted on a property on at 600k. Objectively we probably have over paid, but our plan is to stay there long term, and we have a baby on the way so not much choice to wait it out for prices to come down.

Yellownotblue · 28/04/2022 00:10

Recession and inflation are very useful concepts - up to a point. The reality is that property in the U.K. is what gold is to Indian women - it’s a safety net; it’s status driven; it’s attractive to international buyers; it’s got restricted supply.

In other words, no matter how uncertain the future looks (and it has looked very uncertain recently, for instance in the credit crunch, and after Brexit), property is seen as a “safe” investment and largely immune to market downswings.

This is compounded by the fact that after 2008 the government issued guidance effectively restricting banks from repossessing house following mortgage defaults. This isolated the housing market from a correction that many thought was needed.

Fast forward to now - the market recovered from the credit crunch and went crazy again for a few years. Then everyone avoided putting their house on the market after Brexit, because of the slump; the market got very constricted and demand started to pent up. Then came Covid, which froze the market altogether, but also meant many people saved more and therefore became desperate to buy. Meanwhile buyers in Asia and elsewhere were still pouring money into London, and pricing people out (who then move to Surrey/Kent/Berks etc), creating a domino effect.

This is where we’re at now. I don’t think we are anywhere near the bubble bursting. Simply because lots of people still have the resources to up their offers and push prices further up.

CockingASnook · 28/04/2022 00:37

It’s all dependent on location (as always). In a sought-after town in the SE then there’s nothing to worry about. Demand will always exceed supply. Round the Home Counties houses are going for 10% over.
But I’d regard offering over on a flat as far more risky than a larger house. Over supply of flats, less scope for increase in value, less desirable for growing families etc. but who knows?

gitbag · 28/04/2022 05:43

Rishi was talking about interest rates of 2.5% yesterday wasn't he. I think it's sensible to stress test to 5% but can't see them going above that. And fix because the impact will be in the next few years as opposed to now.

gitbag · 28/04/2022 05:45

In other words, no matter how uncertain the future looks (and it has looked very uncertain recently, for instance in the credit crunch, and after Brexit), property is seen as a “safe” investment and largely immune to market downswings.

There are plenty of flats near me that have sold for zero or very little profit if bought & sold pre Brexit. Although this is already an expensive area.

MugOfBuildersTea · 28/04/2022 06:17

rainingsnoring · 27/04/2022 19:03

We may be at the start of a recession now but we don't yet have the figures and won't until the end of the Summer.
However, with rates if inflation as high as they are and rising and interest rates at 0.75% and therefore very negative in real terms, I doubt they will lower rates. In any case, they don't exactly have much scope to lower them from their extremely low level. The bank are in a bind either way. The economy is in huge trouble.
I agree with other posters who said it may still be in some people's best interest to buy now if they are paying huge amounts in rent, etc. The OP did specifically ask about falling vs rising prices and mentioned selling within a fairly short period, I think. In my opinion, she may well lose money if she does this but clearly others disagree. I guess it's a long time since a major fall in house price values.

@rainingsnoring

I'm being outbid by cash buyers. Landlords and overseas buyers. Unfortunately U.K. residential housing is now an international investment market and those buyers aren't hit by rising interest rates etc.

MugOfBuildersTea · 28/04/2022 06:18

I don't think that house prices will fall much regardless. There are too many international buyers. I've read a lot of articles recently about how buyers from Hong Kong are snapping up properties in the South East. UK property is still very cheap compared to places like Hong Kong.

This is happening in Liverpool too.

MugOfBuildersTea · 28/04/2022 06:27

dubyalass · 26/04/2022 19:19

Eventually people just opt out rather than paying mug prices

This is where I'm at. Just not bothering going to see the offers over houses. What's the point?

I think we've been on similar threads together before ☹️

MugOfBuildersTea · 28/04/2022 06:49

daisymade · 26/04/2022 21:29

I’m an associate director in a national real estate company, I work in the rural estates department so I’m management rather than transactional property but I have two transactional analysts in the team who are all modelling horrible trends in the next 12 months.

If it looks like a bubble and it behaves like a bubble, it’s a bubble. When it bursts (and it will!) your mortgage is fixed in at the price you paid, at the valuation at that point, not what you lose in the crash. And let’s all remember that most mortgages are inflation linked. I think people are genuinely batshit paying 10%+ over the guide.

Thanks for this.

Is this just the rural market do you think, or cities too?

I'm trying to buy in a city but I'm being outbid by international buyers (mostly from HK) at the moment. As they are cash buyers they aren't affected by rises in interest rates. Their motivation is to get their money away from China and the U.K. property market is seen as a safe place to store their cash.

MugOfBuildersTea · 28/04/2022 06:56

MidnightMeltdown · 27/04/2022 17:32

@nairyw

No we aren't in a recession. I said if there's a recession.

Retail sales are already falling so it's quite possible that we will enter a recession within the next 3 or 4 months. That will squash interest rate rises.

I don't think that house prices will fall much regardless. There are too many international buyers. I've read a lot of articles recently about how buyers from Hong Kong are snapping up properties in the South East. UK property is still very cheap compared to places like Hong Kong.

https://www.theguardian.com/business/2022/apr/18/britain-could-fall-into-recession-this-summer-say-experts?CMP=Share iOSAppp_Other

mum61 · 28/04/2022 07:13

@rainingsnoring Agree , I have been outbid by cash buyers 3 times .

KinkyDoritowithsparkleson · 28/04/2022 07:20

Got told all going way over asking as high demand in my area. Was surprised at high valuation. Actually took a slightly lower offer as they are ready to go and I want out. It got down valued by the mortgage lender so had to drop. Could resist but it's all so unpredictable at the moment and I still have a good price for it. 15k under what the guide was.

Now have to decide whether to buy or wait. It's feeling a bit crazy out there at the moment.

KinkyDoritowithsparkleson · 28/04/2022 07:21

Also got told by the EA lots have been down valued by lenders in the last week or so.

KinkyDoritowithsparkleson · 28/04/2022 07:22

I'm looking near Manchester. Lots have reduced in the past few days. Just waiting and watching from my DP's rental.

MugOfBuildersTea · 28/04/2022 07:33

@KinkyDoritowithsparkleson

That's interesting. I think the Manchester and Liverpool markets are similar.

It might be worth waiting. I haven't been able to get a viewing for ages but I've got 3 on Friday.

evilharpy · 28/04/2022 07:35

We're trying to buy in NI and everything is selling for well in excess of asking price. I'm prepared to go 10% over asking price on the house I'm currently bidding on. I've seen a few properties on Propertypal (NI equivalent to Rightmove) in the FTB price bracket change to sale agreed but then they have been relisted a few weeks later and I wonder if it's because they've been downvalued. If ours is downvalued we could fund the gap.

We need to move so no option really other than to pay whatever it takes. We are buying at the low end of the market though just to get us there, with the intention to upgrade in a year or two, so if there is a crash it might end up being to our benefit.

mrsbitaly · 28/04/2022 07:39

Devon, we offered £16,000 over guide price thank fully it was valued at that amount so we didn't have to pay an excess. I didn't see one house sold that we bid for at asking price always over

KinkyDoritowithsparkleson · 28/04/2022 08:03

We've been watching for about 5 months now. It's amazing to see the drops all happening at the moment. We had a page of searches that was all reductions in the past couple of days. I'm still waiting for an exchange date on mine. I was Leeds' suburbs.

MugOfBuildersTea · 28/04/2022 08:09

KinkyDoritowithsparkleson · 28/04/2022 08:03

We've been watching for about 5 months now. It's amazing to see the drops all happening at the moment. We had a page of searches that was all reductions in the past couple of days. I'm still waiting for an exchange date on mine. I was Leeds' suburbs.

I'm not quite seeing this yet....

Progress for me is actually being allowed to view, despite the fact I'm not a cash buyer

Louise0701 · 28/04/2022 08:25

@KinkyDoritowithsparkleson still waiting for that here for my sister who is trying to move before January for school places. A house a few doors down from us just went for 40k over asking to a cash buyer.

MugOfBuildersTea · 28/04/2022 08:30

Louise0701 · 28/04/2022 08:25

@KinkyDoritowithsparkleson still waiting for that here for my sister who is trying to move before January for school places. A house a few doors down from us just went for 40k over asking to a cash buyer.

What area is this please?

gitbag · 28/04/2022 08:37

I think in the area I want to move too things are shifting. Last month even as chain free buyer with hefty deposit struggled to get even a viewing & outbid.

yesterday & today lots more for sale & not listed as offers over & the open days seem to be reducing. The last property we bid on the EA said no point going crazy as it will get devalued.

stuntbubbles · 28/04/2022 08:43

lemon88 · 27/04/2022 22:45

We're in the south east, just had an offer of 630k accepted on a property on at 600k. Objectively we probably have over paid, but our plan is to stay there long term, and we have a baby on the way so not much choice to wait it out for prices to come down.

Wonder if it’s the same £600k house we just lost out on! We can’t go over £600k as need to keep some money back for a garden office and maternity leave. Plus I’m wary of the impending crash. Think we’ll switch our targets to £525-550 houses so we can go over on those. Curse this market!

Nw22 · 28/04/2022 09:24

@KinkyDoritowithsparkleson which area of Manchester is this as where I’m looking they are still going over asking prices?

Guttedbuyer · 28/04/2022 09:28

15/20% is absolutely standard here at the moment! Grrrrrrr