Some friends of mine desperately need to sell

twadge_face

Blacklight wrote: »

They have a small two up, two down and really need some more room. The house has been on the market for a few months and they keep getting offers from people that are "taking the !!!!" (around 15% lower than the asking price).

Desperate as they are they decided to take the place off the market rather than sell it cut price and let someone else get a cheap deal at their expense.

Tell me, how is any offer "taking the !!!!" ?

At least they are getting offers.

They have to remember, this is BUSINESS. People get into all sorts of pickles as they start bundling in EMOTION into the sale of their oh-so-precious asset. Why take offence? Sounds just a teeny bit unhinged!

It'll sell for what someone is prepared to pay for it. And furthermore it'll sell for however much a lender is prepared to offer as per the relevant finance.

I have actually heard near-identical tales myself (London/Surrey area), and as soon as there is a more reasonable capitulation along entire chains, we'll see a gradual return to fair value across the board.

Fact is, your pals need to negotiate to say 10% off the asking price to an agreeable sales price (guessing it's likely overpriced in the first place anyhow), then negotiate the same concession in regard of the place they're gonna buy.

Y'see, your pals save more money off the place they buy compared to the "hit" they take on their own sale. As prices drop, it's a good time to trade up.

That way, everyone's a winner and saves dosh. This is MSE after all.

If not, everyone stays put and remains very grumpy!

twadge_face

Graham_Devon wrote: »

Considering that's the only offers they can get, after a few months, thats what the house is worth.

Bingo.

Crying over it and doing themselves the injustice of sitting in a home they are not neccesarily happy in, isn't going to increase the value, neither is it going to persuade anyone else to pay their thoughts on what it's worth.

I'd also add that it seems unlikely those offers are going to particularly improve... UNLESS they're "lucky" enough to bag, say, a wealthy FTB (possibly cash buyer), who is so immune to the market they'll pay over the odds and it'll mean nothing to them.

It's not common to find such a person in this position, but it sounds like a pal of mine has bagged such an FTB as they're flogging their place. Lucky, lucky, lucky.

Most "normal" people will make the relevant "cheeky" initial offers that are in reality no cheekier that the "cheeky" initial asking prices.

Overall, they haven't really achieved anything. Just got annoyed that the house isn't worth what they think it should be, pulled it off the market in protest, and put themselves in a position where they don't move on.

They could sell, bank the cash (well, get an independent financial advisor and hopefully put it somewhere it'll make money), and rent a bigger place for a bit whilst they consider their options.

The one very good thing about the current market appears to be the overall lack of increasing prices.

Although this does class as speculation so might not appeal to the risk-averse. Depends how truly desperate for additional space they really are.

I suppose I should be congratulating this foresight?

As ever, those who make money on property are economic GENIUSES. Sorry, GENII (plural, right?).

kabayiri

Blacklight wrote: »

...
The problem seems to be that they don't like the thought of giving about £20k away to a complete stranger. Can't say I blame them, who would?

In the greater scheme of things, 20K isn't a massive amount of money, especially with housing.

It should be put into context too. Trading up to a better house may mean better/cheaper commuting, more parking, closer to relatives to support planned family changes etc.

We should take the emotive element out of the discussion. Were they in a position to negotiate with any of the potential purchasers, or did they kill off any conversation dead? I think we lack detail.

Cleaver

AD9898 wrote: »

Most people can pay their mortgage at this time because IRs are so low, although 36,000 repossessions when base rate is 0.5% is still very high and proof of the ridiculous cost of housing.

You always come across as very intelligent Ad, but do you really think this represents a high repossession rate? There are about 15 million homeowners in the UK, so 36,000 reposessions a year represents 1.15% of people. Or to put it another way, on average every month every 1 in 5,000 homeowners get repossessed. This seems tiny to me. If you said that 15 million people were going to buy the most expensive thing ever and have to keep up a monthly payment on it for years and years I would guess that way more than 1.15% of them would either fall on hard times or f*ck it up someway.

In summary, when you look around you at the hopeless way in which most people seem manage their personal finances I find it frankly shocking how low this figure is. Especially as most people won't have seen their actual interest rate fall in line with the base rate.

Cleaver

Blacklight wrote: »

Anecdotes... I don't usually, but this seems a true reflection of what's going on out there:

Bumped into a couple I know that I hadn't seen for a while in town. They're expecting their first child in about four months.

They have a small two up, two down and really need some more room. The house has been on the market for a few months and they keep getting offers from people that are "taking the !!!!" (around 15% lower than the asking price).

Desperate as they are they decided to take the place off the market rather than sell it cut price and let someone else get a cheap deal at their expense.

Your friends don't really sound very bright. If they want to upsize, they should sell at a 15% discount and then buy a bigger house which would also, presumably, be at 15% discount (or, to look at it another way, both houses are at market value). That way they save money on their next purchase.

nearlynew

Cleaver wrote: »

Your friends don't really sound very bright. If they want to upsize, they should sell at a 15% discount and then buy a bigger house which would also, presumably, be at 15% discount (or, to look at it another way, both houses are at market value). That way they save money on their next purchase.

You really don't get it do you Cleaver?


Some people LIKE paying more for a house because it makes them feel richer.


Crazy, I know, but that's the mentality of some people.

System

Cleaver wrote: »

Your friends don't really sound very bright. If they want to upsize, they should sell at a 15% discount and then buy a bigger house which would also, presumably, be at 15% discount (or, to look at it another way, both houses are at market value). That way they save money on their next purchase.

How can they guarantee the next seller will also knock 15% off?

I wouldn't take that risk.

Cleaver

Joeskeppi wrote: »

How can they guarantee the next seller will also knock 15% off?

I wouldn't take that risk.

You can't guarantee anything can you? You can't guarantee that they will get their magical extra 15% in the next 5 years either.

Look, we're probably talking about a fictional couple here but I'm sure the story represents the situation for a lot of people. If you have a baby and you want a larger house so that, presumably, you and your family can have a better quality of life isn't the risk worth taking? We sold our old house in 2009 at 12% less than we paid for it so that we could move somewhere else. I think if we'd held out we'd still own it now and wouldn't have moved, as some houses on our old street are still sitting there having been on sale for 2 years. Just sell your house for what it's worth and get on with life.

Jowo_2

Joeskeppi wrote: »

How can they guarantee the next seller will also knock 15% off?

I wouldn't take that risk.

It is a risk, it might not be realised. In a flat market, there are more chances of finding a distressed seller whose need to sell is greater than their desire to get the full asking price. Of course, there are lots of timewasters, too, like sellers who inflate the prices of their property and get offended when buyers offer a lesser sum.

Procrastinator333

Cleaver wrote: »

You always come across as very intelligent Ad, but do you really think this represents a high repossession rate? There are about 15 million homeowners in the UK, so 36,000 reposessions a year represents 1.15% of people. Or to put it another way, on average every month every 1 in 5,000 homeowners get repossessed. This seems tiny to me. If you said that 15 million people were going to buy the most expensive thing ever and have to keep up a monthly payment on it for years and years I would guess that way more than 1.15% of them would either fall on hard times or f*ck it up someway.

In summary, when you look around you at the hopeless way in which most people seem manage their personal finances I find it frankly shocking how low this figure is. Especially as most people won't have seen their actual interest rate fall in line with the base rate.

How did u get 1.15% of people? I make 36,000 / 15m to be 0.24%.

But the point I was going to make is that is the number of peeps who messed it up in 1 year of their 25 year mortgage. I think you need to X25, so 6% over the course of the 25 year mortgage period get repo'd.

Still seems pretty low, but then when you think a proportion of those 15m were 100% owned for the whole period, those defaults are actually out of a smaller pool.