Want to sell? Then why cling to yesterdays valuation?

Conrad

I understand some of you can;t sell below a certain level of mortgage debt, but why the resistance from the rest of you?

Underlying such sentiment must be an attachment to the 2007 value high tide mark. But why? What relevance has that short lived artificial high tide mark to your thinking in the new value world?

Explain:beer:

Running_Horse

Conrad wrote: »

Explain:beer:

Explain why this isn't in the house price forum.

A less accusatory tone might even get a response.

SingleSue

It is in the House Price forum....as well as this one to get a more full reply as some from this board don't go in the house price one.

Doozergirl

It is in the house price forum worded entirely differently.

Slightly more eloquently actually.

People always base their valuations on the ceiling price. It's just that previously a valuation might have been up or equal to the previous ceiling price.

It's pretty easy to judge 15 or 20% down from previous ceiling prices to arrive at a new valuation. You have to benchmark against something when valuing, whether that's the house that sold last month or in the absence of that, a price further back in the past which needs to be adjusted accordingly.

It makes no sense to me to stick a pin and value a house at x now when prices were the same for about four years before. I personally have to benchmark off that - there aren't enough recent sales to begin benchmarking off those.

RetroBob

Lol, I think he or she has a good point.

Richard_Webster

The logic (or lack of it) works like this:

People with similar houses in a particular area all decide that because they were worth say about £220K in the height of the boom £210K is a sensible asking price (and "we'll accept £205K"). Buyer comes along for some reason desperate to buy in that area - tries one or two of them and offers £190K (too high still, but he is a bit naive and he really wants to buy in that area for some personal reason like school catchment or being near aged parents...). Sellers turn that down and eventually one agrees £199K with him.

Estate agents can't really believe they got away with it as they were just about to tell their seller client to reduce his asking price to £195K. Now here's the rub: The other half dozen or so people with similar houses all sit there with their prices as they are, and say that their house is much better than Mrs Snook's house that went for £199K so our price is reasonable....

They keep saying that for several months and don't sell, but "our house is worth at least £200K because Mrs Snooks sold hers for £199K, etc, etc...."

This also makes it difficult for the estate agents because it is then hard for them to tell the other sellers that their houses aren't worth the money. True only 1 of say 6 actually sold, but sellers won't hear that - agents reckon that someone else might be lucky and get that kind of price, so they are a little reluctant to push the sellers too far in reductions, at least for a time....

A mile or so down the road, perhaps in a different school catchment, a previously £220K house is marketed for £189K and sold for £175K and the seller is a happy bunny because he has been moved to another part of the country for his work and can buy something much better for £50K less than he expected....

As Doozer says there aren't enough sales to benchmark off very much that's useful.

Conrad

Sorry for the strident tone, but I find some sellers have a very snotty spikey tone when it comes to them contemplating the fact buyers now expect to pay less. They want to freeframe July 2007 and no damn buyer is going to tell them they now cant aford that price as the mortgages are much harder to come buy. Afterall, isn't thier home the best in the road[URL="javascript:add_smilie("][/URL]

Just wondering why people have a resistance to price movements one way rather than another when both are merely reflections of the money supply.

Staking a claim to a notional 2007 value as itf it's some kind of high tide mark with real meaning and solidity just seems an emmotional rather than logical response.

brummybloke

no one likes to know their stuff is worth less than it once was.

besonders1

coz sellers are too greedy.

hearts

The problem is, prices at the moment are not being dictated by market forces in the same way as is usual ( and I don't mean usual as in the busy years) With the difficulty in obtaining mortgages reflecting badly on house prices. Selling now is a bad move. Prices will settle when banks start looking more favourably on applicants and also when they start releasing mortgages on less deposits on decent rates.
Just as in the last few years mortgage availability created falsely high prices. The same is now the case in creating the opposite.

Just my view of course. ;-)

besonders1

I suppose sellers still have this fantastic image in their head of their home being worth a fortune. A little bit like believing you have won a cash prize competition and finding out it was just a get rich quick scheme. There's always that "I want to believe" in there that gives us false confidence.