Offer advice on 300K..can I get under 250?

ukcarper

marshall666 wrote: »

i'm a first time buyer so don't have the equity. 2500 I can do, going to 8250 is a big jump (psychologically,if nothing else, it feels like ~2K vs ~10k).

I think that is the problem if you think about it locically some properties must be in the range £250k to £275k.

Where I am the lower price detached houses sell in that range while semis sell for £250k so if you want a detached you have to pay it. If you look at sold prices you will see plenty of property selling in that range.

Going back to your house if it sold for £285 in 2005 i would think all things being eqaul it would be worth about £270k.
But as has already been said there is nothing stopping you offering £250k all they can do is say no, which they probably will.

ukcarper

MobileSaver wrote: »

What a bizarre way of thinking!

No doubt you never buy your partner flowers, never buy any new electrical items and have never bought a car because of the risk they all might be worth less than you paid in the near future?

Also if your nice 3 bed detached is now only worth £250k instead of the £275k it's highly unlikely that the 3 bed semi you bought for £250K is still worth £250k now you can get the nice 3 bed detached for that.

marshall666

MobileSaver wrote: »

What a bizarre way of thinking!

No doubt you never buy your partner flowers, never buy any new electrical items and have never bought a car because of the risk they all might be worth less than you paid in the near future?

It's not that bizarre is it? The point wasn't that values might drop, it was that a small drop in the market could lead to a disproportionate change at values near the stamp duty threshold.

ukcarper

marshall666 wrote: »

It's not that bizarre is it? The point wasn't that values might drop, it was that a small drop in the market could lead to a disproportionate change at values near the stamp duty threshold.

But that works both ways and the value is disproptionately better in the first case

marshall666

ukcarper wrote: »

But that works both ways and the value is disproptionately better in the first case

that doesn't help someone who's 275k property is lumped in with all the 240-250K properties due to a small shift in the market downwards

marshall666

For those that are interested, here's Feb 2012 sold prices in the UK in a histogram:

The bars show number of properties sold between the value displayed -10K and the value displayed.
The stamp duty effect is pretty clear.

"This data covers the transactions received at land Registry in the period first working day of feb 2012 to last working day feb 2012. © Crown copyright 2012."

ukcarper

marshall666 wrote: »

that doesn't help someone who's 275k property is lumped in with all the 240-250K properties due to a small shift in the market downwards

Have a look on free net house prices and see how many properties sell between £250k and £275k a £275k property will not be worth less than £250k if prices fall a small amount. If you are worried your house might lose value over the next couple of years perhaps house buying is not for you.

hazyjo

Exactly - thank you. Bashed out a reply, but was winding myself up so deleted.

I had a house which I bought in 2006 for £227,500. At the height of the market, '07/'08, it was 'worth' nearer £300k. Sold last year for £228,500. It's disproportionate to the rest of the market. It was probably 'worth' nearer £270k, but no-one would pay that as they knew it'd be dragged down to £250k very quickly.

I'd bought it in a rising market. It's the risk you take with property - it goes up as well as down. I didn't buy it as an investment, but it would have been a good one looking at the flip side of buying near a stamp duty level: prices can jump up massively in a rising market!

Funnily enough, next door is now on the market for £310k. Havin' a laugh with that one!!

Don't really know how you can compare against 'disposable items', but there you go. I wouldn't need to sell any of those on to buy new ones!

Jx

ukcarper

marshall666 wrote: »

For those that are interested, here's Feb 2012 sold prices in the UK in a histogram:

The bars show number of properties sold between the value displayed -10K and the value displayed.
The stamp duty effect is pretty clear.

"This data covers the transactions received at land Registry in the period first working day of feb 2012 to last working day feb 2012. © Crown copyright 2012."

So there is a blip between £250k and £260k which is what you would expect because of the extra £5k stamp duty but after that it’s fairly even.

I'm not saying there is no effect just that the band is not as wide as people try to make out.

marshall666

ukcarper wrote: »

So there is a blip between £250k and £260k which is what you would expect because of the extra £5k stamp duty but after that it’s fairly even.

I'm not saying there is no effect just that the band is not as wide as people try to make out.

I interpret that graph as follows:
The number sold between 200 and 240 are near enough equally distributed. There is a large rise between 240 and 250 which is likely due to the stamp duty. The lower number of houses selling between 250 and 270 indicates the extra houses in the 240-250 bin have come down in price rather than been raised up.
If the stamp duty threshold were not there, those houses would be selling between 250 and 270-275 (since there is already an even distribution between 200-240).
I.e stamp duty is pulling house prices down from 275 to 250.

this graph
shows what is going on at a higher resolution. 275 looks like the magic number.