I thought that even in this markett any property would sell if at thw right price.

[twinsetandpearls]

We have just phoned the estate agent to drop our price again to lower than we paid for it but I thought if that is what has to be done that is what we will do and just tighten our belts a bit further to save whatever we loose. {although the belt is pinching already.

We were advised to put the house on at 155 ( up north) we put it on at 145 to sell, we have dropped anad dropped and were at 129,500 and wanted to go down to 124.500.

The estate agent has done it but his parting words were
"Your house is worth more than that, we sold an identical one recently for 150K, you are pricing yourself too low for your target market and the problem, isnt the price but that no one wants to buy"

I am sure there is some truth in that as we know other people trying to sell who are not even getting viewings, we are getting those at least but the feedback is lovely house but we are unsure of buying or we need to sell ours.

So what do we do? Our savings have all gone, we tried renting it out but
1 it wont cover the mortgage anyway,
2 last time we did this we were rippped of big style and had top redecorate top repair the damage
3 The renting market is flooded
4All that means is delaying while prices drop further
5 we need to buy in a falling market as we are buying up.

Wow brettgirl. I am 34 and dh is 35, we have one child and another on the way, have never bought a house before and are planning to buy a semi in a lovely area in greater London in the next year or two. You know something I don't?

This sort of thing is said a lot during the boom years but is always proved wrong whenever there is a crash, as there always is.

OK 'never' is too strong - what I actually meant is that you can never assume that you will be able to buy the house you want immediately. The POV that Sorrento puts forward is that a 3 bed in a nice area must be easily available to the 'average' first time buying family and that is simplistic.

OK fair enough!

Good luck twinset.

Agree with brettgirl2 (as I have on two other threads this morning [clone emoticon]). There seems to be a view that every property on the market should only be three times average salary - not even three times joint salaries. Obviously, this is crazy - whatever happens in the next few months/years, it will be difficult for people on an average wage to move into a family house in most/many areas and, historically, it always has been. It's not called the property ladder for nothing.

First-time-buyers in their early twenties are unlikely to go straight to a family house, that's true. However as a direct result of the unprecedented bubble we have had, lots of first-time-buyers are now much older than that, with correspondingly higher earnings, and with rents as low as they have been compared to house prices, have also been saving deposits for the last 5-10 years. We are not especially affluent, probably only slightly over average income for the area. The size of the bubble (and the fact that it's bursting so fast) has rewritten all the rules.

I'm not suggesting all family houses will be 3x average earnings, by the way!

That's correct Jimmy and there are also a large number of people who rather than saving a large deposit have been spending the money you have saved on their lifestyle. Therefore many state that it is 'impossible to get a mortgage' when they are expected to have a deposit. It isn't if you have the deposit though!

There is also no doubt the ridiculous bubble will have an impact for several years, not least because first time buyers from the last four years or so are in a very difficult position if they want to trade up.

And don't forget that lots of people in their early- to mid-30s will be paying off large student loans thus compromising their ability to save.

Even if the bubble had never happened and prices were back at 2000 levels, I still think that it would be difficult for many first-time buyers to walk straight into a family house. My friends and I were all around the 30-mark then and all working in well-paid jobs with prospects and it wasn't something that any of us could manage - instead it's been a series of stepping stones.

Student loans are a big problem for many and are set to get worse in the future.

Brettegirl - so basically you bought what 8 years ago before the HOUSING BUBBLE - nothing to do with a ladder, that got chopped up and used for fire wood years ago.
There is a very good reason why the 3 times one persons and 1 times the 2nd income multiple worked for 50 years.
It's because that's what people can afford without having to use their credit cards to buy food.
Take away that credit and look what happens as we are now witnessing, people can't even afford the basics.

My basic point is in the Blackpool area what is the average persons salary and times that by three, because whoever buys it will at best be trading up from a flat, 2 bed terrace they've bought since 2004 and at worse will be first time buyers either way they need a decent amount of equity/or deposit plus three times the average wage which twin said was £17k, so you're looking for a neddle in a haystack.
DH used to cover Blackpool as part of his area and there are some beautiful houses/areas which twinny is now competing with for a sale.

But does it actually work like that Sorrento ?

A friend of mine is moving from her small three bedroom end of terrace where they have lived for 9 years. It has sold with in a week at £182,500 to a BTL landlord ( who assumably is fed up of his savings earning not a lot in the bank), despite my dire warnings that if it went on at £190k, then no one was going to pay over 175k because of stamp duty.

They are trading up to a 4 bed detached which has gone down a fair bit over the last couple of years and are getting it for 250k. So a jump of nearly 70k plus their fees.

Now I know bugger all about their finances but I do know they aren't the type of people to push themselves. It may well be that they have pretty much paid off their mortgage over the last 9 years so are going to be borrowing about 80k, which is approx 3 x £26.6k.

So on the face of it you could say that her house is a starter home and should be no more than 3 times local wages which are about £22k I think. But it isn't as simple as that as the above example shows.

None of that helps you whatsoever TSAP, apologies, I just wanted to make the point that things aren't black and white with the whole property thing.

So it didn't sell to a first time buyer it sold to an investor who probably thinks there will be hyper inflation in which case we're all going to get a free house but the poorest members of society are going to be begging on the streets as benefits etc don't go up quickly and it's often too late by the time they do.
Good luck to them if they've paid off the first mortgage but the reality is they are in a good position and have been sensible, I come across a great deal more people who in their shoes remortgaged for a £100k and blew it on speed boats and a BMW whilst earning £22k

He may well be fed up with the interest he was getting in the bank, saw the chance of a yield of 5 - 6% and decided to go for it. Or he might be working overseas and wanted a house to come back to in the future. It may be that hyperinflation didn't cross his mind, you can't possibly know the motivation behind his purchase and neither can I and if the last couple of years have shown anything, it is that we don't behave rationally (and I think the guy is nuts but that is besides the point).

And I don't personally know a single person who has taken their equity and bought a speedboat/BMW/racehorse. I do have a couple of friends who have clearly been living above their means but they are the minority. Clearly your experience is different but that doesn't make either of us right. You could point out that the media report many cases to back up what you are saying, I would argue that they print these stories as they sell papers and there are huge numbers of people who haven't done this but that doesn't make such shocking reading.

Things just aren't black and white and at the moment it is pure speculation as to where we will be in a years time. I think in reality house prices will be significantly lower than they are now and interest rates will be creeping up but there a fair few people who think we will go the same way as Japan. Only time will tell as to who is right, I'm certainly not arrogant enough to think that I definitely am.

As I said, none of this helps TSAP with her problem and I apologise for going off track.

T&P, would a part exchange on a new build be any use to you? The builders around here are offering the moon on a stick to potential buyers.

Sorrento - I think one of your bouts of shrillness was aimed at me rather than brettgirl. Yes, as I said in my post, I did buy my first flat before the housing bubble began but even then this utopia in which everyone could move into a family house on a multiple of three times their salary did not exist and hadn't, in many locations, for a couple of generations.

That was the first part of my point. The second was that people like me that got on the housing ladder before it became prohibitively expensive, then climbed it/are climbing it, had to in order to get to our forever home. I don't understand your comment about chopping it up for firewood. I accept that I was very lucky to get onto the first rung when I did but if you mean I have just ridden the market, you would be wrong: I have always bought places with potential and invested a lot of time and energy in renovating them in order to beat the market.

Incidentally, I was looking at an old post yesterday and I came across a poster whose strident tone was very similar to yours - I haven't seen her about for a few months, her name began with K, any relation?

Er no relation am I not allowed to change my name if I think of a better one ?
As they say the first cut is the deepest eh ?
I'm glad you've bought smartly and done well unfortunately the normal rules haven't applied for a while leaving those on the first rung stuck there or first time buyers the age of timothy from sorry.

Brett that was the exact research we did , knowing someone who owns an estate agent chain we were able to make quite an informed choice.

Sorrento there isnt much that is beautiful near Blackpool unless you go over wyre and I would imagine they would not be interested in ours. Our road at our end is full of either retired couples many of whom have lived on the road for decades or famlies who moved into the area as a second buy to get into catchment for the good schools.

I dont know anyone who earns 22K and remortgages to buy speed boats.

We have looked at new builds particularly as they are coming down in price and there are some in the village next to my school. But I just cant bear them, I havent moved my whole family to the other end of the country to live in a box with a tiny garden and a view of someone elses bathroom. But it may be something we need to revisit.

I think the thing is Sorrento that you claim (I'm sure correctly) that you have 350K sitting in the bank waiting to buy. You then assume that the only way anyone else can buy a house is through borrowing three times their salary . You are not the only person who has money, for various reasons. People may have additional money because:

1. They have inherited from relatives/been given money
2. They have been living in a grotty shared house for the past 10 years while earning 40k, therefore enabling them to save (I know several people who fit into this)
3. They have won the lottery or something
4. They bought a house before the boom and therefore have significant equity/have paid mortgage all or most of mortgage off

All of these will enable people to spend more money on a house than the simple analysis suggests. I don't know which one you fit into, but FWIW I am in group 4.

Yes, there are people who remortgaged which is very silly and they will pay the price. A lot of the loans that you hear about are for 'home improvements' which always makes me laugh because a major issue is that a lot of young people today seem to expect to move into a perfect house immediately and can't see that you can still wash in a bathroom with an avocado suite or cook in a 20 year old kitchen. However, I don't think that remortgaging is the majority.

There is also other worth in property. It is true that rents are falling but all property has value to landlords - if someone has £120k in cash for example and is looking for a reasonable yield on their investment, if you could get rent of £600 a month for the property that is a much higher yield than you would receive in most other investments currently. In the very long term the price will probably increase too. Perhaps we have not reached the stage where people will do this, but it will kick in eventually.

In any area there are parts and properties that are desirable and less desirable, the prices are determined by demand and supply. Therefore the amounts will be different depending on how much people want to buy and how many people want to sell.

Wynken makes some interesting points and FWIW I don't think we've hit the bottom yet.

No I said I was looking up to £350k to buy a house with, we have a £100k in the bank so that is still 4 times DH's salary we'd need to borrow, which we shoul;dn't have to and as the days pass that multiple is coming down.
Sellers need to get their heads out the sand and forget about profit which never really existed.
Or else they won't be moving any time soon, it's a stale mate and a lot more people will be forced to sell than are ever forced to buy.

I agree that there is a bit of stale mate but alongside those obsessed with their house being 'worth' whatever there are those who are unable to move due to negative equity. In addition, there are those for whom there is now no point in moving - like for example an older couple who may have considered downsizing will stay put because it just won't net them enough cash to bother. Of course it is true that some will be forced to move (or just be willing to accept the 'lower price')

I also think that the multiples in 2009 are more about joint than single salaries. Few people now buy a house based on 1. Therefore I don't think that 4x one is unreasonable at all, particularly as it is a fairly high salary and therefore less problems with affordability of food etc.

It is unreasonable because unlike most people we work to live not live to work.
It's also very unreasonable on the basis that my DH earns nearly three times the national average salary and yet that is what is required to buy a 4 bed det up north, that's the very unreasonable part, if we were in London and earning London wages I could almost forgive that but we're in a village ooop north.

Some older people will give in first, if you need to be a nursing home then you're actually under quite a lot of pressure to sell and once one person gives in that sets the new price for that road.

None of this is helping the OP but as she's moving up the "ladder" she can't loose.

But you could find a cheaper house if you wanted

You are just choosing exactly what house you want and where and expecting to be able to buy it just because your husband 'earns a good salary'

I don't live in London either and our household income is higher than yours (but joint rather than single). We can't afford to buy lots of houses round here, but when we do move will be able to afford something that we will be happy with. We will borrow 2 1/2 times and just see what is in our price range at the time. Yes, we have a high income BUT lots of people have incomes that are higher!

You are right that this isn't helping the OP but telling her in 2 years time that her house will be worth 60K wasn't exactly a supportive post.

But accurate

In your opinion