The gulf between asking and selling prices.

mitchaa

skap7309 wrote: »

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.......

I agree, but it is not happening as you have a lot of bears out there thinking houses are going to be selling for peanuts

If the houses that you are looking at for example are already 20% down from their peak values and are advertised as such, you would still get buyers coming in with bids of 10/20/30% down from that wanting unrealistic bargains.

Best bet is to market them at their peak prices and let the buyers come in with 20-25% down bids. (This is what your research is suggesting is it not?)

Solves everything.

I think it is some buyers being totally unrealistic, not sellers.

Kez100

You are absolutely right.We have seen this ourselves but some do realise and come up to the right price if they think the house is a good deal.

My parents had a house to sell and asked for a realistic valuation. They were given £180 (would have been 220k at peak) but told they'd be unlikely to get more than the £175 stamp duty level. So, they put it on the market at 180k prepared to accept (at the moment) 175k and got an offer first view - but it was a silly one, 10% off. These people edged the price up but never to 175k so they said no, after all it had only just come to market.

Then the second people to view offered - 8% off! They said no to that but these people edged up and agreed on the £175k (just under by £50).

Goes to show houses will go at the right price.

skap7309

mitchaa wrote: »

I agree, but it is not happening as you have a lot of bears out there thinking houses are going to be selling for peanuts

If the houses that you are looking at for example are already 20% down from their peak values and are advertised as such, you would still get buyers coming in with bids of 10/20/30% down from that wanting unrealistic bargains.

Best bet is to market them at their peak prices and let the buyers come in with 20-25% down bids.

Solves everything.

I think it is some buyers being totally unrealistic, not sellers.

OK. From my personal view then:

Everyday i check new properties that appear on RM. If a house is competitively priced it goes into my saved properties section that i would be very interested in when the time arrives to buy. If it is overpriced (not in my head, for the area) then it gets relegated never to be looked at again. Funny how 90% of these are still at the same price, 18 months on - oh, and they never go SSTC.

I am sure if sellers are employing these 30% overvalue tactics then they are in for a looooong wait because most buyers will not want to waste their time viewing whilst not knowing if they are playing the '20-30% below' game.

ad9898_3

I think the problem sellers are going to have going into the future is house prices are set at the margins, if a particular street has 4 houses for sale at 200k and none of them are selling because the vendors are all deluded and live in 2007, then someone gets divorced and another house pops up for 160k and sells, this is then the new house price value, and no amount of crying will make any difference.

Then the 4 sellers have 4 choices.

1. Take it off the market and forget it.
2. Reduce the price to around the price of the one that sold.
3. If they simply can't reduce because of mortgage constraints then they have to stay until the mortgage is reduced to a suitable level or wait perhaps until 2020 for the 2007 price to come back.
4. If they are desperate and absolutely have to sell but can't because of constraints of option 3, then bankruptcy and voluntary repossession is the only answer.

skap7309

Kez100 wrote: »

You are absolutely right.We have seen this ourselves but some do realise and come up to the right price if they think the house is a good deal.

My parents had a house to sell and asked for a realistic valuation. They were given £180 (would have been 220k at peak) but told they'd be unlikely to get more than the £175 stamp duty level. So, they put it on the market at 180k prepared to accept (at the moment) 175k and got an offer first view - but it was a silly one, 10% off. These people edged the price up but never to 175k so they said no, after all it had only just come to market.

Then the second people to view offered - 8% off! They said no to that but these people edged up and agreed on the £175k (just under by £50).

Goes to show houses will go at the right price.

Good for them - that sounds exactly how it should work.

And people wonder why the market is so choked up at the moment.

Strapped

Annocdotal support for biggish difference between asking and selling: House in our village was advertised at £50 below £400k, reduced after a few weeks to £370k. It sold a couple of weeks later. I was surprised to find it sold for £308k. I'd imagine there were a few choice conversations going on. But at least they were realistic and sold.

mewbie_2

Given that it's the most valuable thing most people own they're bound to try to get the highest they can for it.

I've just realised what a crass and simplistic sound bite that is. But having gone to the effort of typing it I'll press send anyway.

besonders1

I can't wait to get past the silly prices obsession era and for people to start seeing their house as a home rather than a cash cow otherwise they won't be going anywhere for the rest of their days LOL.

I suppose when people buy a car, its value only goes one way and people see its as" worthwhile" to get into debt over a car. They don't see this as being in negative equity when they sell it 5 years later when they want to upgrade for a bigger or better model. People see a car as a useful investment to getting to work or taking their family out. The same should be for a house, to meet their needs. I can't really see sellers refusing to sell their house for long if they really really want to upgrade to a better house, they will just try and forget about what they paid in 2007 and just swallow the loss when the banks start lending again even if its tens of thousands. Just like the people who bought in 2007 didn't think about being in negative equity as they needed to buy then. Thats the trouble with irresponsible lending, people just don't know the true value of money, and its something that we will never learn.

1echidna

Bit of an adventure for us selling a house as we (wife and I) have never done it before. On advice from chosen agent we are asking about 12% below peak and he feels we may achieve a selling price of around 15% below peak. His argument is to aim a little high initially and lower if necessary to achieve a fresh burst of interest. His valuation was the highest of the agents who visited (although not by much) but we didn't chose him because of this, more because of his ability to identify and describe the positive features of the property. It does seem that similar properties in the road being sold are still asking peak prices so maybe he is right and ours will attract interest and if we do achieve 20% or better below peak I shall think that reasonable. Any comments?

Kez100

You need to get the people through the door mate. If your price does that then great. Overvaluing for a laugh in this market is madness if you ask me. Then what do I know - apart from the fact we didn't overvalue and had two offers in the first two viewings.