The gulf between asking and selling prices.

skap7309

With time on my hands on this Friday afternoon i have just calculated that the asking prices are currently 30% over what selling prices are.

To get this figure i have taken Rightmove's asking price figures (£218k) and the average of the Land Registry, Halifax and Nationwide selling prices, which is £154k.

I am suprised this has not been brought up before and all this talk of the crash coming to an end seems very premature if sellers are asking unsustainable amounts for a property. I fully understand they are entitled to ask whatever they want to but we are talking averages across the board here and leads me to believe there is at least 18 months to go before prices stabilise.

Asking prices for a property type i am after are £200k. Now in theory the selling price should be £140k but i cannot see an offer EVER being accepted for that. If they were, they have me buying today and this is evidence the market could and would move again, taking the strain off the economy. With all the government tinkering / estate agent's false talk of the market that goes on do they not see this bigger picture? Does anyone else agree with me on this one?

Cannon_Fodder

I'm sure someone will decide that is far too simplistic and find ways for it to be wrong.

10, 9, 8, 7...

Really2

Is the Rightmove one weighted or just the total asking prices / by the number of houses for sale?

Guy_Montag

Better to look at medians - rightmove probably has a higher proportion of expensive houses on it that the other indexes since, I would imagine, that an expensive house takes longer to sell (at any time) & so stays on right move longer than a cheaper one.

In effect you get a backlog of expensive houses on RM, pushing the average price higher.

chewmylegoff

rightmove also has all the houses on it that have been put on the market by

(a) loons who think they can sell for 2007 peak prices because their house is "worth it"

and

(b) people who cannot sell for less than X because of their mortgage and therefore are unable to reduce the asking price

all this stuff sitting on the market at unrealistic prices with no prospect of ever selling will skew prices upwards.

it would be useful for rightmove to publish a secondary index of asking prices on properties that have actually sold. presume that would be lower, since stats are that sellers supposedly achieve 88-90% of asking price.

mizzbiz

Remove the 95th and 5th percentile. It should give a more balanced figure (takes out all the billionaire pads and all the £5000 lease commercial premesis that skew the figures). That's what we do when analysing data at work.

mitchaa

Why should any seller in the country sell his/her house for anything less than 20% of it's peak value?

Why would a seller be so stupid to accept a 30% down offer already on a 20% down price

Why would a seller foot the bill for future drops I think some buyers are hoping some sellers are zipped up the back:D

Perhaps sellers know buyers will bid 20% down on their properties so they put them up by 20% to take this into account, that's what i would do if i were dealing with day dreamers:p

skap7309

mizzbiz wrote: »

Remove the 95th and 5th percentile. It should give a more balanced figure (takes out all the billionaire pads and all the £5000 lease commercial premesis that skew the figures). That's what we do when analysing data at work.

mizzbizz, sounds like you know what you are doing. Trouble is trying to find out how to do it. Just had a go on Home.co.uk - they have both average and median asking and selling.....only problem was i had all the data but they do not produce the median selling price for ALL houses. i.e. it is broken down into detached, terrace etc.

skap7309

mitchaa wrote: »

Why should any seller in the country sell his/her house for anything less than 20% of it's peak value?

Why would a seller be so stupid to accept a 30% down offer already on a 20% down price

Why would a seller foot the bill for future drops I think some buyers are hoping some sellers are zipped up the back:D

Perhaps sellers know buyers will bid 20% down on their properties so they put them up by 20% to take this into account, that's what i would do if i were dealing with day dreamers:p

Eh?

Thing is mitchaa you have completley missed the point. If a house was priced correctly in the first place then why would anyone need to offer a high percentage below asking price? Sellers are entitled to say no.......

mitchaa

skap7309 wrote: »

Eh?

Likewise, too much time on my hands posting drivel;)

skap7309

mitchaa wrote: »

Likewise, too much time on my hands posting drivel;)

Quite.......