Wait for sale or rent out?

giffen

Hi :wave:

I'm new to this forum but have been reading MSE for years. I hope that somebody will be able to offer me some advice please?

We have been trying to sell our flat since July last year, having had one offer that we accepted in September only for it to fall through in November (purchaser made redundant). Since then we have been averaging about 6 viewings/month that has yielded no interest, despite dropping the price by £10K last month.

Very recently, our jobs have both changed, meaning that we are moving to another city before the end of the summer and are looking to rent there.

My question is whether we should keep the flat on the market until a buyer comes along or whether we should rent it out until things begin to move again?

If we do keep the flat for sale, ideally we would like to convert out mortgage (Alliance&leicester SVR) to interest only so that we could afford the rent on a new place. Does anyone have any experience of this?

If we rent it out it would mean we would be able to make overpayments on the mortgage, but we would still be 'tied' to the property. Also, I have previously rented the flat out before and found it quite stressful.

If anyone has any advice or suggestions, or are in a similar situation to us, I would love to hear from you.

Thank you.

00ec25

giffen wrote: »

Also, I have previously rented the flat out before and found it quite stressful..

you have answered your own question or do you want history to repeat itself ?

DannyboyMidlands

With respect, when do you think things will "begin to move again"? I know people who have been reluctantly renting their places since 2008, rent barely covering the mortgage let alone other expenses, capital tied up, value depreciating by at least 5%pa due to inflation alone while they wait for the market to "return to normal".

In my opinion the current market is normal(ish). It was the boom up to 2008, liar loans, 125%LTV mortgages etc that were abnormal.

If I were you I'd drop the price till it sells and move on with your lives.

Good luck with the move and the new jobs.

giffen

Thanks DannyBoy. We are willing to drop the price further, but our estate agent has advised us to wait the summer out before doing this. The reasons for this are that the property is currently for sale for £10K under the surveyor's valuation (as of July '10), it is priced fairly with respect to similar properties nearby, and finally, we did think that should the price be an issue someone may have put in a lower (cheeky) offer regardless?

Our problem is compounded by the fact that our flat is definitely first-time buyer territory, and what first time buyer has £30K to use on a deposit for a £120K flat at 75% LTV? Until higher LTV mortgages are offered to FTBs, or property prices drop significantly across the board (or both!), many places for FTBs remain out of reach.

It's a Catch22 situation. We would be happy to drop the price significantly to get it sold, but only if others do too, otherwise we will be priced out of buying elsewhere.

giffen

One more thing I forgot to add, is that competition is against us. For every potential buyer that comes along, they have literally 100s of similar properties to choose from. The odds for us aren't great.

brit1234

giffen wrote: »

but our estate agent has advised us to wait the summer out before doing this.

Many first time buyers now use the property bee hack on rightmove. We can see when people reduce prices and other changes on rightmove and just look at the ones where there have been changes. With property bee I wouldn't bother to look at your property till it showed the price decrease in the Summer. Your Estate agent is speaking tosh, if you want to sell in a buyers market you have to sell cheaper than your rivals or spruce it up far better than your rivals.


Have a look at property bee below, it works well for you buying and renting as well.
http://www.property-bee.com/

DannyboyMidlands

If you are willing and can afford to drop the price further I don't see the point in waiting. As you say, you're currently lumped in with 100's of similar properties who are presumably also planning on cutting prices after the summer. I'd be wanting to get ahead of the curve, stand out and sell rather than follow it down with everybody else.

I imagine you'll be renting in the new city for at least 18 months before you feel settled and even know where you'd want to buy. If you bank the equity from the sale and save hard it shouldn't stop you buying again. If prices continue to fall you could even be quids in.

harrup

brit1234 wrote: »

Many first time buyers now use the property bee hack on rightmove. We can see when people reduce prices and other changes on rightmove and just look at the ones where there have been changes. With property bee I wouldn't bother to look at your property till it showed the price decrease in the Summer. Your Estate agent is speaking tosh, if you want to sell in a buyers market you have to sell cheaper than your rivals or spruce it up far better than your rivals.

Don't want to hijack the OP thread but what do you mean by "property bee hack". I use property bee but I can't see a filtering option whereby it ONLY shows recent reductions.

Hmmm....confused.

xtcc

Were in a very similar situation to you, only we gave in and the property is currently being rented out.
It was on the market for 11 months dropped the price by £10,000 to the minimum we could take, and still no luck. So had to reluctatly rent it out in February.
We desperatly want to relocate in December but want to get rid of the house first, as it's an ex marital home for my OH. Estate agent tells us to keep renting it out but we want to sell it.

Sorry it's no help to you but will watch the replys you get with interest.

DannyboyMidlands

@xtcc

Is your estate agent currently acting as your letting agent?

xtcc

How did you guess lol :-)