Property Bee - Overpriced Homes

pandamonia

people wont get bites because there is always someone more desperate than you to sell. and they will drive prices down and leave the overpriced ones look stupidly overpriced and wont get any activity at all

torontoboy45

always useful to hear about what's happening elsewhere.
im my locale there are a few pockets of resistance but in the main vendors have started to come around to reality.
a 2bd terrace on at £134k in july 07, withdrawn early 08 has now rejoined the market @ £110k, roughly reflecting the 17% fall experienced in this town.
whether vendors are prepared to accept further falls this yr remains to be seen.
assuming the above fails to sell and is re-priced 12 months hence with a further reduction of £16.5k (guessing a 15% fall) a near - £40k wipeout will be galling to even the most fatalistic.

pandamonia

even with increased market activity the pressure on falling prices will continue, such is the cost of borrowing for most people is still high 4-6% also job security is poor so people will refuse to overstretch themselves. Banks are reigning in salary multiples for lending, HSBC tracker is now at 3.5x income unless you opt for 6% fixed you can get 4.25x - LTV's are going backwards still and products are coming off the market. there is still a good 20%+ priced into the market for most buyers. but your always going to get people with little idea of the world buying at whatever price they seem reasonable

besonders1

If people don't need to sell then they shouldn't waste time marketing their property at unrealistic levels.

ess0two

besonders1 wrote: »

If people don't need to sell then they shouldn't waste time marketing their property at unrealistic levels.

Suppose the same can be said for people attempting unrealistic reductions on properties.
Works both ways.

Nenen

JayZed wrote: »

If I put it on the market now, I'd put it on at about 15% below peak price, and would probably be inclined to accept an offer around 5% below my asking price.

I don't know if we are in any way typical of the few potential buyers that are around, at this point in time but, to be honest, I don't think you'd have much hope of selling with that strategy and might as well save the money you'd have to spend on HIPs to put it on the market. I would anly consider buying something which I felt was marketed at a bargain price (i.e. at least 20% below peak) and would accept an offer at least another 10% below asking price, otherwise it will soon be worth less than I pay for it! I might as well wait and see what happens before taking a gamble like that.

Nenen

carolt wrote: »

Can't see anyone buying the nasty 2 beds. I suppose eventually the EA's will get rid of them if their costs get too high?

Out of interest, does anyone know how much it costs an EA to keep a property on the books? Obviously, there is a relatively large initial outlay in getting valuation done, taking photos, compiling brochures, and putting onto Rightmove etc but once this is done, what are the ongoing costs? Is there for example an ongoing cost with keeping a property on Rightmove, or is it a one off fee?

Nowdays, when so many people look online, EAs have far less brochures to send out (which cuts down both printing, mail and admin costs). Advertising in local papers etc is costly I know but I'd hazard a guess that EAs don't do this too often for properties which have been sitting on their books at overinflated prices for a long time. Obviously accompanied viewings have a staffing cost but then if a proprerty is way overpriced I doubt whether many people will view anyway!

From a purely selfish point of view (potential buyer) it would be good if EAs had large ongoing costs that would ensure they encouraged sellers to either be realistic or remove their properties from market, but I can't think of what these might be. Am I missing something vital? I can only think that, having speculated a large amount of money taking the property onto their books, the EAs don't want to flush this away by pressurising the vendor, even if it is costing them money... a bit like the compulsive gambler who always thinks the next bet will be the one that pays off his previous losses!

pandamonia

Nenen wrote: »

Out of interest, does anyone know how much it costs an EA to keep a property on the books? Obviously, there is a relatively large initial outlay in getting valuation done, taking photos, compiling brochures, and putting onto Rightmove etc but once this is done, what are the ongoing costs? Is there for example an ongoing cost with keeping a property on Rightmove, or is it a one off fee?

Nowdays, when so many people look online, EAs have far less brochures to send out (which cuts down both printing, mail and admin costs). Advertising in local papers etc is costly I know but I'd hazard a guess that EAs don't do this too often for properties which have been sitting on their books at overinflated prices for a long time. Obviously accompanied viewings have a staffing cost but then if a proprerty is way overpriced I doubt whether many people will view anyway!

From a purely selfish point of view (potential buyer) it would be good if EAs had large ongoing costs that would ensure they encouraged sellers to either be realistic or remove their properties from market, but I can't think of what these might be. Am I missing something vital? I can only think that, having speculated a large amount of money taking the property onto their books, the EAs don't want to flush this away by pressurising the vendor, even if it is costing them money... a bit like the compulsive gambler who always thinks the next bet will be the one that pays off his previous losses!

how about the cost of showing people around a property every day?

besonders1

Estate agents only keep the overpriced homes to fill a gap in their window for the time being. Once vendors begin to discover the "biting point" they will either ask the overpriced sellers to reduce or take it off the market. Is it true that they bill, sellers for doing this, as I though it was no sale no fee?

Nenen

pandamonia wrote: »

how about the cost of showing people around a property every day?

I thought I'd covered that when I wrote, "Obviously accompanied viewings have a staffing cost but then if a proprerty is way overpriced I doubt whether many people will view anyway!"