Your thoughts on the current market?

[vanillafudgecake]

Evening all,

We have been thinking about moving for a while but given the current situation in the market of high interest mortgage rates along with property prices not dropping much in our area, we would be sensible to sit it out and wait to see what happens?

Most properties on the market in our area need some level of renovation and labour/materials seem ludicrously expensive right now together with high asking prices which don't seem to take this into account.

We have viewed a few houses (that need modernising) and have made a couple of offers around 10% to 15% below the asking price but vendors are holding out for offers at asking price. A few years ago they would have sold quickly at asking, if not over, but they are not moving so quickly now.

Our position is we would need to sell but have no mortgage and we have a substantial amount in a high interest savings account. So we are very comfortable hence not in a rush and we love our home but equally we would like more space for our family to grow into and the properties we have offered on are in a desirable location that don't come to the market very often.

If one of our current offers was to be accepted we would need to take out a small mortgage (on a high interest rate, gulp!) and along with the cash from selling our home and releasing our savings it would cover the renovations too. This would be our forever home

What would you do in this position?

I would wait too. You are in a great position, with no mortgage to pay and not in any rush. Some of the currently unrealistic sellers will reduce their house to more reasonable levels in time and at that stage you can be ready.

I don't think these folks will reduce until they see headlines stating prices have fallen 10%, or they hold out for the January/Spring boom and neither happens, whichever of those happens first.

Personally, I would let other buyers do the legwork of having offers refused until they start getting more realistic. It's just too draining.

Thank you for your replies,

My sensible hat agrees and says to wait and then I have a slight panic and worry it could be our only opportunity to live in the area we are looking at

It's such a draining process on all levels!

I’d stop making offers until you’ve sold your house? You’ll be in a better position and someone is more likely to be tempted by a lower offer from you?

I agree there’s a lot of overpriced stuff with sellers not being realistic. Currently a large house for sale in my village, been for sale for eighteen months and they haven’t reduced the price. It’s about 100k overpriced. 🤷‍♀️

Even in this market, I'd be surprised if a seller accepted 10/15% under offer when you technically can't pay for it. As you have seen- it's taking time for houses to sell, so if you want to move, you need to go to market.

Why offer when you can’t buy it? Your offer isn’t remotely tempting. It’s just fiction until you have sold your house. It’s draining as you are trying to buy something you currently cannot proceed with. So you are not being taken as a serious buyer (because you aren’t a serious buyer).

Put your house on the market and sell it. Then your offer may be more tempting. Why would they take an offer from someone who cannot afford to buy it currently? It may also take you months to sell. Or you may only get daft offers from people who can’t currently buy.

I was just about to say the same thing as @CormorantStrikesBack

You will not be taken seriously as a buyer when you have a house to sell yourself before you can proceed. If you are serious about buying (which isn’t clear) then you should put your own house on the market in January and see if you can get an offer. If you do, you will probably find Sellers more willing to take you seriously and possibly start negotiating.

Not many people would accept an offer 10-15% below asking and take their property off the market for someone who hasn’t even got their own property on the market, let alone sold it. So if this market gives you an opportunity to buy the sort of property you would not be able to get in a stronger market, I would take the first step of putting your own house on the market.

Also if it’s your forever home in the desirable area what are you waiting for? If this is a long term plan and improves your quality of life and happiness and the houses done come up often then why wait?

If theirs drops in price so does your house. You are only getting older and the time to pay your mortgage shorter. Your kids are getting older.

I extended when mine were tiny to make the most of the crazy money I spent.

Mmmm, you see I see it slightly differently, not enough info to go on in the original post.

let’s say these houses are £350k for example. How long have they been up for sale? Would they have been put up at £350k in March 2022? Or would they have been up at £380?

Is your mindset that you must have a 10-15% reduction irrespective of the asking price just because the market has changed or are these houses actually priced right for the current market conditions ?

it’s easy to believe everything coming on the market is overpriced, but EAs still want to sell, and it’s their job to guide the sellers on what they can realistically achieve in the current market.

if these houses have just come up, the seller isn’t going to take your offer at potentially 297,500k (15%) because you feel like you should get 15% off and building materials are expensive. Or because you will have to pay this mortgage back on normal interest rates.

if an EA valued your house at £300k, would you accept £255k because a viewer didn’t like your decor and fireplaces?

I suspect you would be outraged.

if this is a house for life and you love it, I would take a punt with a realistic offer.

of course, if the house has been on the market for 18months, then my response would be different.

Cross posted with @Janislowe & @avenue1 so I’m glad to see them saying the same thing.

We are in a similar position. Am looking you put house on market soon but worry I won't find anything to buy !

That’s always the worry isn’t it?

But at least once you have a Buyer you know you can proceed immediately if a great house does become available. And you will know exactly how much you can afford because you will know what you got for your house.

It’s always best to put your own property on the market if you’re serious about trying to moving home.

I think the market is such now that you wouldn’t necessarily have to have sold or even be on the market to be taken seriously as a buyer. But I wouldn’t expect a seller to take the house off the market until you are sold, and I would prepare for a long haul selling your own house.

Unfortunately I wouldn't take any offer seriously from a buyer who hadn't yet sold.

Decide if now is the time you'd like to move, get a buyer if so, and go from there.

Personally I don't think all property will magically reduce 10-15% as the data is showing reductions seem area/location dependent. Some areas have shown rises.

So decent, popular property will always hold value more - so it may not be worth waiting. There's also less of the market because of the uncertainty (if you're waiting as a buyer, sellers are too).

Friends of ours accepted an offer from someone who hasn’t sold a few months ago, but only because they made a very high offer (& my friend is someone who gets stressed by viewings). But at least the people who offered had their own house on the market!

It was a mistake anyway because the potential buyers couldn’t sell their own property and the whole thing dragged on for months and has now fallen through.

You can view properties in this market without your own one being on the market but it’s unlikely you would be able to negotiate a good reduction on price unless you’re able to proceed.

We just lost out on a house, we were gazumped and we ultimately offered 10% over the asking price for. There was a bidding war. There is nothing else on the market we even want to view and we are in rented and ready to proceed. I hate the house buying process in England with a passion. It’s been an expensive few weeks as we are left with solicitors and search fees to settle now on a property we thought might be our forever home.

In some areas prices are holding because there is so little coming into to the market, that when something does come up it creates a mini bidding war for those who still need to move for whatever reason.

You'll be in a much better position to negotiate a deal you're happy with once your own house is under offer.

It depends on your time frame. If you want to move within the next 4 or so years then now is the best time, prices are going to drop further. It will take time for them to recover and for the banks to improve interest rates (and remneber that when this happens, there will be an increase in people going to market which will push prices down further).

If you don’t need to move, I wouldn’t bother in this market. With all due respect OP, if I wasn’t in a position to buy (ie needing to sell in order to do so) I wouldn’t even be viewing, let alone making an offer. Just a waste of everyone’s time. We sold in 2020, EA were under strict instructions, no viewers unless they had SSTC.

From the news and the Business pages I get that Central Banks and Institutions here and in US are expecting Interest Rates to hold and then reduce. They think it has probably stopped getting worse. Remember they are thinking Long Term.
An investment manager I spoke to thinks next year could be better for Stock Markets.
For Property I think realism is priced in.
But what do I know? I used to be in the investment business before I retired some time ago and been wrong before.
I think amateur buy-to-let mkt at or close to capitulation so very few more do uppers likely to come on the mkt.

If it's not your dream house then there's no point in moving. We moved in August and we probably paid more than we needed to but we loved the house and didn't want to mess around and lose it. There were only two houses on the market that we really loved in the 10 months we spent watching the Rightmove. I'm 99% sure I won't care how much we paid when we sell it in 20 years time (the stress of moving has put DH off moving again for at least a couple of decades).

If you are comfortable where you are, just stay put. The market is slow and both buying and selling are problematic, so just save your time and money and be ready to move whenever the market picks up.

I don't think you will have to wait that much longer for sellers to start becoming more realistic on price. Maybe 6 months or so.
I would be tempted to spend some time and effort making your house as sellable and appealing as possible. Whilst keeping your eye on new potential property that comes up, also waiting to see what the sold prices on property you like actually were - by checking land registry data.
I think the spring bounce will be a complete washout, followed by sobering news on prices by early summer.

Our purchase has fallen through since we were gazumped, we got caught up in an insane bidding war. It went for over 10% of its asking price.

We don’t have to sell, staying in a family property and paying their mortgage while they are overseas, they have no plans to return. No mad hurry to move.

Nothing coming up on RightMove that we like and we feel a bit burnt by our recent non purchase so considering not buying now, at least for a long while.

In my North Derbyshire town there is a lack of good quality modernised property coming on the market. When they do they are selling within days. Anything that needs a full refurb, if not priced accordingly is not moving. Prices are certainly holding up well for desirable properties in the better areas