What is is with old ladies and their houses?

EdInvestor

mean_momma wrote: »

In the '70's, I think that most loans were based on a single breadwinner (although there was tax relief ). There were still mini booms plus there was a recession when you could not sell your house unless it was a bargain (sound familiar?). In the '80's boom, we had the group mortgages, many of which ended in tears. Then we had the '90's recession, when you once again could not sell your house unless it was a bargain . In the 00's, we had all sorts of joint mortgages including civil partnerships, plus all the advantages of looking up house prices on the computer. Boom, followed by 'can't sell your house unless it is a bargain'. No wonder some older people just name a price and stick to it - what goes around comes around!..

One wonders how many people see the current situation not so much as a house price crash, but more as a period where you can't sell your house for what it's worth, and thus must just wait a while.After all the last time this happened only ended a bit over 10 years ago.

One also wonders how many of the reluctant elderly sellers have already done equity release without telling their kids and aren't in a position to sell at all.

mewbie_2

Maybe the old'er' people want the maximum possible for their main asset. Having lived through various levels of hysteria over the years, and a war they may hang on for the best value in their eyes that they can achieve. Good luck to them.

brixham

As an aside, a ancestor of mine was left £10 ( and the green bed and bedding !) in the will of an employer.
She managed to live off this for the last 8 years of her life without working or getting any parish relief. £10 must of been a huge amount of money to her.
OK so it was 1863.
Wonder what happened to the green bed and bedding though.

Davesnave

One wonders how many people see the current situation not so much as a house price crash, but more as a period where you can't sell your house for what it's worth, and thus must just wait a while.After all the last time this happened only ended a bit over 10 years ago.

I now rent in a road where, at 60, I'm the youngest male. Across the road is an older couple who were with the same agent as me, and in direct competition, 12 months ago. The agent is bust, I'm sold and they're still at the same price.

When chatting, I've discovered that these folk, again like me, had sales fall through in 2008. From this, they have taken the idea that if they had a buyer before, it can happen again, so all news about the economy etc has to pass through this 'filter.' They're also convinced that they won't be able to downsize and reap any significant reward.

From observation/discussion, I've come to the conclusion that these two are probably representative of thousands who own outright. The only reason they want to move is to be a bit nearer friends & family, but there's nothing they can't do, and it's a secure, comfortable place. They have very limited ambitions, so taking any kind of risk, like lowering their price, is too scary. They have the house on the market so they can kid themselves that they're acting, rather than doing nothing. The guy's main motto seems to be: 'Things will pick up again eventually.' He's right, but whether he'll be around at that time is another matter!

The whole psychological thing is about motivation. In our old house, DW and I couldn't do what we want to do next with our lives, so our motivation to drop the price and get the hell out was strong. If we were fifteen years older, it would be a different ball-game. In my experience, the only thing that really motivates the elderly to move house, is the overwhelming feeling that it has become too much for them to manage, and even then, a substantial number do not act without a good deal of prodding from their children.

mean_momma

Davesnave wrote: »

I now rent in a road where, at 60, I'm the youngest male. Across the road is an older couple who were with the same agent as me, and in direct competition, 12 months ago. The agent is bust, I'm sold and they're still at the same price.

Well done. Sounds as though you were in the fortunate position of being able to undercut the competition, particularly useful if the other house price was high!.

Davesnave wrote: »

They're also convinced that they won't be able to downsize and reap any significant reward. They have very limited ambitions, so taking any kind of risk, like lowering their price, is too scary..

Hmmmnnn, I guess they just don't want to take a chance on ending up making an expensive mistake. If they were to sell cheaply, they would get negligable interest on savings, therefore capital would begin to dwindle straight away. Unless a lot of suitable properties suddenly hit the market, finding a the ideal new home at the right price could be a slow process. Then there would be buying costs, stamp duty, etc, all eating away at the 'profit'.

A neighbour of ours, in her fifties, made the mistake of selling in the 2004 mini dip that particularly affected London. The agents used the 'if you seriously want to sell' line', she sold quickly at a lower than (currently low) market price, had to give a further discount at the last minute, and has regretted losing her lovely flat ever since. She only made a small amount on trading down, not enough to justify the move.

Davesnave wrote: »

The guy's main motto seems to be: 'Things will pick up again eventually.' He's right, but whether he'll be around at that time is another matter!

I suppose that the ideal time to make the move as just as things start to turn, but who has a crystal ball?!

Davesnave

mean_momma wrote: »

Well done. Sounds as though you were in the fortunate position of being able to undercut the competition, particularly useful if the other house price was high!.

You have an interesting concept of fortunate! Getting about £50k less for my house than I'd been expecting was scary. That was my point. Properties I've been keeping tabs on are now dropping by similar amounts, so its becoming clear that I won't lose out. That's what's fortunate. It wasn't clear when I took the decision to sell at that price.

Hmmmnnn, I guess they just don't want to take a chance on ending up making an expensive mistake. If they were to sell cheaply, they would get negligable interest on savings, therefore capital would begin to dwindle straight away. Unless a lot of suitable properties suddenly hit the market, finding a the ideal new home at the right price could be a slow process. Then there would be buying costs, stamp duty, etc, all eating away at the 'profit'.

Most people up this road have been here 20+ years and own outright. Some have been here since it was built in the 60s! Yes, from what I hear, their owners do want to 'profit,' but it would be pretty hard for them not to. In many cases they would get back maybe 8 or 10 times their original investment.

A neighbour of ours, in her fifties, made the mistake of selling in the 2004 mini dip that particularly affected London. The agents used the 'if you seriously want to sell' line', she sold quickly at a lower than (currently low) market price, had to give a further discount at the last minute, and has regretted losing her lovely flat ever since. She only made a small amount on trading down, not enough to justify the move.


But this is not a 'mini' dip; it's a huge, long-overdue correction.....and that's at best.

I suppose that the ideal time to make the move as just as things start to turn, but who has a crystal ball?!

Nobody has a crystal ball, but I don't think we are going to go back to 2007 prices for a very long time. Having children, I hope not. By hanging on to sell at those prices, people in their mid-seventies are, effectively, wasting time they don't have too much of. For those without a strong need, like those in my example, it would be more sensible to get off the agent's books and on with life.

mean_momma

Originally Posted by Davesnave
You have an interesting concept of fortunate! Getting about £50k less for my house than I'd been expecting was scary. That was my point. Properties I've been keeping tabs on are now dropping by similar amounts, so its becoming clear that I won't lose out. That's what's fortunate. It wasn't clear when I took the decision to sell at that price.

What I meant by 'fortunate' was that there were overpriced properties to undercut, rather than keenly priced ones - although it was still a big risk for you.. .

Most people up this road have been here 20+ years and own outright. Some have been here since it was built in the 60s! Yes, from what I hear, their owners do want to 'profit,' but it would be pretty hard for them not to. In many cases they would get back maybe 8 or 10 times their original investment.

But assuming they get back 10 times their original outlay many many years ago, they will still only have the means to buy another house, as everything has gone up!

As you say, people in their '70's don't know how long they may have - but it could be a good 20 yrs. They would need a lot of downsizing money to pad out their pensions even for 10 years, imho..

LydiaJ

EdInvestor wrote: »

One wonders how many people see the current situation not so much as a house price crash, but more as a period where you can't sell your house for what it's worth, and thus must just wait a while.After all the last time this happened only ended a bit over 10 years ago.

Indeed. I have two friends who've each inherited a house recently from a deceased parent. In each case they're letting the property because they don't think they'd get much for trying to sell it. I haven't asked them how long they think it will be before it's worth trying to sell. I'm afraid they may end up having to sell for much less than they'd get now, if letting doesn't work out as they hope, and prices don't come up as soon as they expect.

Davesnave

LydiaJ wrote: »

Indeed. I have two friends who've each inherited a house recently from a deceased parent. In each case they're letting the property because they don't think they'd get much for trying to sell it. I haven't asked them how long they think it will be before it's worth trying to sell. I'm afraid they may end up having to sell for much less than they'd get now, if letting doesn't work out as they hope, and prices don't come up as soon as they expect.

Exactly. The house I'm renting is a kind of inheritance. Its sale, if they could sell it, would pay for the parent's care home.

It is off the market now I'm in it. After costs, the owner will receive less than £1000 a month, but it is losing more than that. Factor-in structural and modernisation issues, and it's likely that my landlord will be the one who's in the care home before it returns to a 2007 price!

lostinrates

Without wanting to stir up a hornet's nest again, on tv now there is an interesting example...although the woman is middle aged with an adult/almost adult son....down sizing from Norwich area I think, to Worcestershire. Its on Channel 2...and the programme is called escape to the country.