Houses wildly overpriced near me and NOTHING is shifting

[toffeeapple45]

My parents are house-hunting at the moment in the area close to me, and it's so frustrating. They've sold, but literally every "downsizable" house in my area is on for genuinely I would reckon about 200,000 more than they're worth. I think 2022 was about the peak in my area, but these prices look as if prices had carried on tracking up for the last four years. We're in an area that boomed during WFH, but is not going to do so well as people are ordered back to the office - which is certainly not reflected in the pricing. Nothing is shifting at all, and it's only going to get worse with Iran. Houses are going off the market and coming back on for sometimes, insanely more. It feels like people got their houses valued in 2022 and are just never going to accept that the market isn't there any more. I'm irrationally annoyed with one local estate agent who tells everyone their house is worth X when it's just clearly not the case. My parents accepted less than they would probably have got in 2022, because they figure that is what their house is worth now - and they can rent for a bit and they'd rather not be in a chain. GRRRRR.

@toffeeapple45 I agree with you that this is happening in many places. I've seen masses of properties at the higher end not selling for several years with too low reductions, changes of agent, etc. As you said, I think things will only worsen economically so hopefully some sellers will become more realistic.

We’ve just gone on the market and this is what we are doing. It’s a pain having to pay marketing costs if the sale doesn’t happen, but we don’t have to move we just want to move.

I'm in the camp of people hoping for house prices to fall and "nothing selling' would be a precursor to that.

BUT, I never see the data to back that up and so I doubt stories like these. Two pieces of real evidence:

UK Property Market Stats Show on YT. That shows (national) sales agreed volumes pretty much at a 10 year average high.

Area 360 profiles. These show the transactions for a given area for the last 10 years - tracking median, P5, P25, P75, P95 prices for different home types in the chosen location. Nearly everywhere I look prices and transactions are holding up. Check your own area and let us know what you see.

It looks like being a difficult year for both sellers and buyers. Probably the average cost of mortgage borrowing (currently ticking up a little at 5.2%) is going to be closer to 6% by the end of the year. This will be combined with another round of higher inflation and a another bloody increase in cost of living.
I agree with posters on here that facts are that those who dont have to sell won't sell - and that in addition there will be high numbers of sellers who just can't afford to sell and are stuck. Smaller numbers of those that do have to sell (Death, Divorce, Dementia and Debt) will change local future achievable prices though. That has always been the case.
Those new entrants or upsizers that are lucky enough to be able to afford to buy may get a bargain (in terms of headline price). Of those many will need to buy with high ltv mortgages and are going to be paying through the nose - as will some current owners with high ltv and low 2021/2022 rates shifting to much higher rates.
Its massively complex, I did think that by the end of this year prices would be gently drifting down and the market freeing up a bit as a result. Now that the landscape is changing again, in terms of affordability, I'm not at all sure where we will be.
Anyone planning to buy or to sell this year will need to re-sharpen their pencils again though. That seems certain.

Supply far exceeds demand in many areas now, why don"t they just stop building!

Part of the problem is that many people buying and selling today have no concept of higher rates, they think current prices are "normal"., many people I talk to don"t understand even how their mortgage rate is set.

https://uk.investing.com/rates-bonds/uk-10-year-bond-yield

Why can’t they offer under -if the sellers find that their new house has also dropped they might accept

I’m currently on the market, we went for the estate agent that seem fair as their houses never seem over priced but we’ve not sold for almost 10 weeks now. We already reduced the price and zoopla is saying we’re priced way below average but the 2 offers we’ve had still want to pay way less. It’s obviously a buyers market as there’s lots of houses but as we want to move but don’t need to move, we’ll stay until we get an acceptable offer. The main reason for our move is to have a one final move to buy a detached house with an extra bathroom in a nicer place but our current house is perfect for us as it is. Even better as paying the less mortgage means we have lots of disposable income which will reduce when we move so we’re not desperate to move.
I’m sure there’ll be lots of sellers in the same position as well so the buyers that are coming with a low ball offer had better just go and buy what their money can afford on the market.

Well, yes, obviously but most of us do a Rightmove search to gauge the market, no?

I've been following a few towns in the west Midlands for a child considering where to buy first property and it looks as if the FTB market is lively. I asked for viewings on several that were sensibly priced and/or in decent condition but these were snapped up fast. Between £200 and £250k seems to be the sweet spot, but saying that, the nicer family houses I was watching seem to have gone under offer equally quickly.

Some people might end up in negative equity which is why they don’t want to accept house prices have gone down.

I think what’s stalling the market in my area at least is that so many properties need full modernisation and they are not priced accordingly, they are priced as if they are fully renovated and when you factor in the cost of renovations on top the property would not be worth what you spent if you had to sell in the short or medium term, renovating/modernising a property costs so much money now, plus being able to find the trades to do the work in the first place can make moving seem an impossible task. I know new builds aren’t popular on here but I can see why people buy them.

When my neighbours first put their house up, it sold within days, but it fell through due to them not being to find anywhere else for their budget. They took it off for about a year, then put it back on for about £15k more than they had previously (and about £35k more than they’d bought it for, 4 years prior), and it took 12 months to shift it. I don’t know if they accepted a lower offer in the end, but it was not worth what they were asking for it. It seems to be a common theme in my area though.

Edit: I should add that they’d done no work to the place.,

Market is very stagnant here in SW London, but lots of properties are being reduced. I’m thankful we bought in 2020 before the peak, and have paid off our mortgage, so we can just ride it out. It must be very frustrating if you want to/ have to move.

Im in NI and houses are selling well above asking. I know 2 people trying to buy a starter home under 200k and they end up going for 240k. My friends brother just completed on a 2 bed flat. On market for 125k and sold for 148k. Property prices are generally lower here though. There’s also been a big rise in families returning from GB (with one NI spouse) that has pushed prices and demand up.

Sympathetic to everyone trying to establish what a house is worth right now. We will be selling to relocate 200 miles for retirement but there are only two houses comparable to ours, our NDNs either side. One lot have been there a few years longer than us (27 years) and won't move, and I don't think the other neighbours are going anywhere short term. So our house is going to be the first house of its kind and in the area on the market in eight or nine years. I feel for the estate agent trying to guesstimate.

We have been on the market since last June, 3 bed semi just received a great offer, but we can't find a 2 bed bungalow to buy, how long the buyer will wait , I do not know.

I live in an area like that - the issue is that all the 3bed/bungalows are priced with development and extending by new buyers in mind. They are overpriced to ensure the seller gets their share of the onward development (plots of land sometimes go this way - the plot is revalued with any building etc and the vendor is entitled to a share of the uplift, despite having nothing to do with the build/development. Madness)

Fine if you have a buyer that wants to convert/build extend (as our neighbours are currently doing 🤦🏽‍♀️) but it snookers people who genuinely just want to downsize to a smaller house and garden. There will come a time when only flats/apartments will be available for retirees. or the property bubble will burst.

I understand your position and would probably feel the same in your shoes as there are advantages to you staying put.
However, as well as some sellers in a similar situation to your own, there will be others who really do need to sell. The buyers will simply buy their properties if they are willing to accept 'low ball' offers. Those lower prices will reduce the price of the competition in a falling market. Prices are set at the margins in this way.

There’s a house near me that I am admiring which sold for 375 in 2021 and was originally listed at 525!! It’s been reduced twice now to 475 but I still can’t see how it is worth any more than 425. They haven’t done anything to it except rip out an en suite and put some ugly cladding on (which if we do buy the house we will be removing) so if anything I feel like they have taken value AWAY from the house.

If you’re chain free and have an area in mind, just canvas the area/road by dropping a note thru their letterbox.

It’s crazy where I live, 4 bed detached houses are going up for 40+% higher than they sold for 4 years ago. Yet nothing else is seeing such huge increases….
And oddly enough they’re not selling! 🧐 But vendors won’t reduce the price.
One has just gone up for £20k higher than it was marketed for last year, didn’t sell then so why do they think it will sell now!
utter madness!

How could it have increased by 50k since 2021? Interest rates have gone up in a straight line since then. It will sell for less than they paid (borrowed) I think.

It is only the houses that actually sell that make the market, these sellers will be left behind.

Inflation is devaluing most houses as the cost of living bites
more new estates keep ticking over