35% of houses will not sell in a year?

Damaged

Alan2020 wrote: »

Why do you think they are not selling? Lets take a different product say a mobile phone, because the market is FAST moving the price for a top end phone can be £400 at launch to £50 at the end of its life, even less. In order to sell the phone most retailers have a knack of getting the price right for the quality of the phone.

Welcome to a house market that was always stable and rising, now it is like the mobile phone market, and should rightly be so. There is supply and demand, too much supply less demand. How do you break it, by lowering the prices. We have a free market, so it will mean prices will come to the correct value in say 20 years, if it was a controlled market prices will always be close to the correct value.

Take some of the flats in the UK, a one bed costs £150K in reality to build such a flat, it would cost the builder £15K to 30K with the market value of labour. And if the market was heavily regulated a flat in the UK will cost anywhere from 20K to 35K, but oh no it costs £150K, why?? Because it is overpriced and unsustainable.

Imagine trying to sell a Nokia 3310 (yes the old brick) for £1000, how many people would buy it, no one, £10 someone might. So the 35% of houses are simply overpriced as they haven't moved with the market.

The housing monopoly will only be broken when someone with huge capital gets land in a prime location and builds well designed prefabbed flats in all the major cities in the UK at £35K for 1 bed, £45 for 2 beds and £55 for 3 beds with terraces/balconies. This will crash the overpriced flat market and generate the new Bill Gates of the housing market. Whoever does that will be simply the richest person in the world.

Do you have any idea about how much it costs to build a block of flats. In truth I dont think you do.

You're missing the expensive parts with respect to the build.

Damaged

SimonMrGreenWard wrote: »

This caught my eye. Simply baffling. How much do you think the land will cost?

it depends entirely where you buy of course, esp with planning restrictions restricting suitable land.

For example Barratts are building next to us, out of the 30 flats they are building, ten are given to the council, with a further £100k S106 grant/ donation. All just to get planning permission.

This is where the money is, not the actual physical build cost.

myhouse_2

NEH wrote: »

We moved out last year as my health was failing and the flat was no longer suitable.



Because you don't have far to go until you sell it for 30k or lower at which point we would be stepping off the property ladder and couldn't afford to buy again for at least 10 if not longer years...

I can't see how taking a 30/40K off your asking price and then renting somewhere else for 10 or more years is beneficial. Surely it is better to rent it out for the time being until things ease a little and supply doesn't outstrip demand, as i said we don't know which way things will go in the area the flat is in as it's different to other parts of the country.

You're quite probably right about keeping the flat if your circumstances allow it. But generally we were talking about selling in this thread. If your shares are worth 100k and you're trying to sell them for 130k and are not willing to sell for 100k, then you're not really a genuine seller. To put it another way, your housing investment is worth more to you than to the potential buyers. Best just to take it off the market if that's the case.

Orpheo

NEH wrote: »

As I said we looked at reducing the price and asked our Solicitors whether the lower priced one had had more interest or any offers and they said it had made no difference, people just don't want your kind of flat just now.

If nobody wants to buy your flat because there is zero demand for "your kind of flat", it doesn't mean that your flat is holding its value. Forgive me, but if nobody wants to buy your flat because there is zero demand for "your kind of flat" it means that your flat is worthless.

Right now there is zero demand for this type of property...



I am not literally calling your flat worthless. You need to open your mind to the fact that everything saleable will sell at the right price.

tyllwyd

There is a circular argument here - on the one hand you get people saying 'your house is priced too high, anything would sell for £1' and on the other hand you get people saying 'your house is priced too high, look at these Detroit houses that can't be sold even for $1'. Where does that get you?

The problem with the Detroit houses goes much much further than the actual land/houses themselves. You could look at a mud hut in a flood disaster zone in the Third World and say look, no-one will buy this home for $1 - it would have the same bearing on the situation of a flat in Scotland.

Orpheo

Just to further my point from the perspective of a buyer with in excess of a 50% deposit in the price range that I intend to buy...

Two houses in the area that I am searching, both with the same EA, have just lowered their prices. I have been aware of both of the houses as they are in a location where I would like to live, but (until now) I have also judged them to be at the wrong price. These houses have now reduced to an asking price where I feel that we may be able to negotiate a fair selling price. They are now firmly on the radar. I'm going to telephone the EA right now to arrange viewings for this week.

Orpheo

tyllwyd wrote: »

There is a circular argument here - on the one hand you get people saying 'your house is priced too high, anything would sell for £1' and on the other hand you get people saying 'your house is priced too high, look at these Detroit houses that can't be sold even for $1'. Where does that get you?

It gets me to the conclusion that if something won't sell at any price, that it is worthless.

Read more carefully.

tyllwyd

Orpheo wrote: »

It gets me to the conclusion that if something won't sell at any price, that it is worthless.

Read more carefully.

What has that got to do with the situation? Nobody has said that the flat won't sell at any price, but the owner is not willing to go below a certain price - which means that it is not worthless to her, it is worth that mental reserve price that she has put on her own property. If she doesn't sell it she could always live in it, rent it out, or leave it empty. Her choice.

NEH

Orpheo wrote: »

If nobody wants to buy your flat because there is zero demand for "your kind of flat", it doesn't mean that your flat is holding its value. Forgive me, but if nobody wants to buy your flat because there is zero demand for "your kind of flat" it means that your flat is worthless.

Right now there is zero demand for this type of property...



I am not literally calling your flat worthless. You need to open your mind to the fact that everything saleable will sell at the right price.

Thanks Tyllwyd, you always manage to put it better than i ever can, so thank you...


The flats can be rented out as they are quite popular so that's is the option we are looking at....

They have always sold well up until last September but now there is so many 1 bed, flat, mainsonette and studios that buyers are limited.

I wouldn't say it's worthless it's just not popular right now.

Alan2020

Damaged wrote: »

Do you have any idea about how much it costs to build a block of flats. In truth I dont think you do.

You're missing the expensive parts with respect to the build.

It costs approximately with white goods/appliances about ~ £2,300,000 for a block with 100 flats, which if you see the unit cost (assuming same size, which in reality would be, studio, 1, 2 ...) you get a unit price of £23,000. But here in the UK we have phantom costs and tea drinking builders and gross miss management and a totally unregulated market. So people here will pay £100,0000 for that crap :mad:

Obviously luxury flats are a different story, look at double this figure.