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Join our Property forum for renovation, DIY, and house selling advice.

Property/DIY

Vendors kidding themselves right?

57 replies

NorthernLurker · 11/10/2008 10:28

There's a house just come on the market up the road from us. Being nosy I've looked it up on Rightmove. They bought it two years ago for 249,999 - which was too much then and is the highest price a house on this street has ever fetched. Now they are marketing it as 'offers above' 249!!! Who are they trying to kid? Do they seriously expect that somebody will pay extra stamp duty etc and pay more than the house was worth two years ago? I don't subscribe to the apocalyptic predictions of some - but even I think these people are living in la-la land!

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critterjitter · 14/10/2008 16:51

You do need to consider though whats happening with unemployment (its rising!). Of two couples I know, only one of the partners of one of the couples is now in full time employment - one was recently made redundant, one put on to part time working (or told to accept redundancy), the other is due to be made redundant in a matter of days. Both couples have lovely big houses (£400-500k), are in the middle of house extensions, cars on hire purchase etc etc. One of the couples has an v. large interest only mortgage and is due to renew soon (with only one of them working part time out of the couple!).

I think house prices are just going to go further and further down. Think we will see repossession after repossession on the market.

dinny · 14/10/2008 16:54

mmmm, have heard it said the repos and redundancies will start in earnest after Xmas

so hard to know if this money being poured in will just prove a brief respote or not

oranges · 14/10/2008 17:11

do you notice markets are falling again, on fears that companies are going bust. the banks were just the start of it.

dinny · 14/10/2008 17:12

today, Oranges?

oranges · 14/10/2008 17:15

yes, in the u.s.

here

dinny · 14/10/2008 17:17

what doesn't make sense about the UK bail out (to me) is that surely it's encouraging more bad debt?

short-termism by the gov I suppose?

critterjitter · 14/10/2008 17:37

Think its a sticking plaster by the government to get them through to the next election. Don't think its going to work though.

dinny · 14/10/2008 17:38

GB is crowing with delight though isn't he?

expatinscotland · 14/10/2008 17:39

yes, they want us to borrow more money irresponsibly so house prices stay artificially inflated.

thing is, you can't force people to borrow, and so people just aren't.

fair enough if you can afford to keep paying that mortgage or two, then you can afford not to drop your selling price.

at the same time, buyers don't have to play that game, either.

lots for rent, even round here, and it's coming down in price!

dinny · 14/10/2008 17:41

surely lenders wn't be lending 8 times people's income again though - just more sensible old-fashioned rates - 1-2-3 times income?

dinny · 14/10/2008 17:42

Exapt, so would you hold off buying still? think things will drop even more?

expatinscotland · 14/10/2008 17:44

well, even if they do, it's a two way street, because a borrow has to agree to borrow that much over their salary to buy a home they realise is over-inflated.

like i said, obviously these vendors don't really have to sell.

so, let 'em stay in their house. they must not need to move.

expatinscotland · 14/10/2008 17:45

yes, unless i got a deal like noddy's, i'd hold off.

dinny · 14/10/2008 17:46

Expat, but aren't a lot of borrowers desperate to borrow as much as they can, iysim?

regardless of the consequences?

critterjitter · 14/10/2008 17:48

Pretty sure that banks aren't going to go back to the old income multiples (one of the reasons why we got in this mess in the first place). And if first time buyers still can't get on the ladder too (because prices are still out of their reach), then vendors are just going to have to either adjust their prices accordingly or not sell. Add in all the repossessions, as well as those who are trying to get out of the market quickly because they can't afford their new rate, have been made redundant, or can't rent out their properties (because there is now a glut of rental properties)and I'm pretty sure that prices are going to keep on tumbling!

expatinscotland · 14/10/2008 17:50

'Expat, but aren't a lot of borrowers desperate to borrow as much as they can, iysim?

regardless of the consequences?'

absolutely not. not anymore. not when inflation has hit about 6% in real terms (not the BS figure the government puts out that doesn't include rent/mortgage or council tax) and everyone's waiting with baited breath to see if they're going to have a job in the new year.

that's why house sales are at a 30-year low.

i mean, why pay more with interest for something that's not worth what someone's asking for it just because that's what they want?

here

of course, sellers still think the borrowers are of this mindset.

well, like i said, they must not need to move.

bluemousemummy · 14/10/2008 18:25

If I were a first time buyer I would not consider buying now anyway, having said that we have just accepted an offer from a first time buyer on our house for £2k above the price we bought it at 3 years ago. Having spent a good £8k on it I am pretty gutted really but it's probably not a bad offer given the circumstances.

KatieDD · 14/10/2008 18:38

Regardless of the consequences ?
This is the first time most 20-30 year olds have even heard of house prices doing anything but rise, it'll have come as a complete shock after 10 years of property ladder etc.
I don't think any of them will be in a hurry to get on that sinking ship.

noddyholder · 14/10/2008 18:49

I hope they continue to fall but I think the sticking plaster analogy is a good one.Just wait ti lit falls off though!These temporary repair jobs will just make the eventual catastrophe worse.I bought because rentals are so dire here and because i have an interior design disease where i need to be tinkering with a house and I can't do that in a rental.

ClosedForCleaning · 14/10/2008 19:22

I think this (or similar) has been posted before, but:
www.irvinehousingblog.com/wp-content/uploads/2008/03/psychological-stages-of-a-bubble.jpg

I think we're in transition, teetering between denial and fear.

dinny · 14/10/2008 19:45

that's interesting, CFC

hmmmmmm, I keep panicking we are missing the boat!

dh is a true bear though!!

oranges · 14/10/2008 21:09

if you want to buy, make an offer on a place you really love, at a price you can honestly afford. Even if they reject it stragiht away, chances are they'll come back and accept a while later.

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dinny · 14/10/2008 21:30

however much lower that offer may be, Oranges (even if they take mortal offence? )

KatieDD · 14/10/2008 21:42

Can you live with giving somebody 40k (15/20% for example) plus the interest you have to pay so £120k in total over 25 years, or mortally offending somebody you need never see again ?

expatinscotland · 14/10/2008 21:45

exactly, Katie DD!

why pay more with interest when you don't have to?

if you can't afford it and the seller doesn't like the offer, then that's a sign that it wasn't meant to be, there is something better out there, walk away.

you're the one in the driver's seat.

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