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Debate House Prices
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Artificial prices.
martynh99
Posts: 134 Forumite
Yes i'm feeling bitter because I didn't get my offer accepted on this property but what the EA told me really annoys me.
House on market for £199950
They accepted an offer of £199950 with the vendor paying £6500 towards their deposit.
My guess is the buyer didn't have enough deposit if they bought at £193450 as on an 80% ltv they would need deposit of £38690.
By getting a mortgage on £199950 they would need £39990 deposit but when you take off the £6500 the vendor is 'giving' they only need £33490 .
What this does to the market is the LR will be shown as £199950, all the monthly price indexes will artificially show that sold prices are on the up and people are obtaining mortgages they can't afford - one of the contributors to the economic crisis we're in today.
House on market for £199950
They accepted an offer of £199950 with the vendor paying £6500 towards their deposit.
My guess is the buyer didn't have enough deposit if they bought at £193450 as on an 80% ltv they would need deposit of £38690.
By getting a mortgage on £199950 they would need £39990 deposit but when you take off the £6500 the vendor is 'giving' they only need £33490 .
What this does to the market is the LR will be shown as £199950, all the monthly price indexes will artificially show that sold prices are on the up and people are obtaining mortgages they can't afford - one of the contributors to the economic crisis we're in today.
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Comments
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How much did you offer?This is a system account and does not represent a real person. To contact the Forum Team email forumteam@moneysavingexpert.com0
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How do you know the buyers circumstances??I came in to this world with nothing and I've still got most of it left. :rolleyes:0
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Should have offered a bit more.0
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Should have offered a bit more.
I offered what I thought the house was worth based on things like market peak, prices others sold for and compared quality/work required between same.
I created this thread to discuss the way deals are being done and how they contribute to the monthly HPI and LR registrations and how people *may* be acquiring mortgages they maybe can't afford - look at Northern Rocks arrears rates this week !0 -
bo_drinker wrote: »And nosey I should imagine as it has nothing to do with him really
Agreed it doesn't have anything to do with me, but if the EA is going to spill the beans why not listen to them
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I agree :T Must have been the right place for them to offer the asking price in this market.Agreed it doesn't have anything to do with me, but if the EA is going to spill the beans why not listen to them I came in to this world with nothing and I've still got most of it left. :rolleyes:0 -
Yes i'm feeling bitter because I didn't get my offer accepted on this property but what the EA told me really annoys me.
House on market for £199950
They accepted an offer of £199950 with the vendor paying £6500 towards their deposit.
My guess is the buyer didn't have enough deposit if they bought at £193450 as on an 80% ltv they would need deposit of £38690.
By getting a mortgage on £199950 they would need £39990 deposit but when you take off the £6500 the vendor is 'giving' they only need £33490 .
What this does to the market is the LR will be shown as £199950, all the monthly price indexes will artificially show that sold prices are on the up and people are obtaining mortgages they can't afford - one of the contributors to the economic crisis we're in today.
Why would the vendor give them money towards the deposit?
Surely a price reduction would have sufficed?
How do you know that they got an 80% LTV?
If there was the amount of work needing doing that you say there was. Then the property wouldnt have been valued at the price it went on the market at.
You valued the property after costing in what you wanted to spend. Unfortunately buying a house is more heart at times than cost analysis. Using historical data is totally misleading.0
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