Is the market overpriced .. what should I pay

hcclnoodles

Hi there

I have read from a number of sources that the market is a little over inflated at the moment and that I should be looking a t a guide price of 2006 as the marker as to what i 'should' be paying

The Victorian conversion flat /maisonette in Surrey I am looking at was purchased by the current owners in 2002 for £160,000.

The flat is now advertised for sale for ( 250,000 - 275,000) .

Based on calculations on other properties that have been bought and sold in the same area, I see a 20-30% rise between 2002 and 2006, which would put this property at around the £210,000 mark ??

Just a point of note, there has been a little bit of extension to the property with the addition of a conservatory and the bricking up of the door on the attached garage which is now there as a possible new room (although no work has been done inside it)

I just wanted to ask whether the asking price of 250-275 is realistic in this case and what a good starting point may be?

I wont be able to go over 250 anyway due to stamp duty

any guidance would be greatly appreciated ...im pretty new to this

Notmyrealname

The market price is what people are currently prepared to pay - there isn't actually any such thing as an inflated market other than in the eyes of those trying to make a story.

It only becomes a problem if you're not planning on being there long and if £250k is all you can pay then £250k is the maximum offer you can put in and inflated market or not won't change that.

somethingcorporate

Yep, the value of a house is what someone will pay for it, not what someone paid for it ten years ago +- the move in the market since then.

Why not have a look at the sold prices for similar properties nearby?

DRP

somethingcorporate wrote: »

Yep, the value of a house is what someone will pay for it, not what someone paid for it ten years ago +- the move in the market since then.

Why not have a look at the sold prices for similar properties nearby?

...and of course what someone is prepared to sell it for!

breadlinebetty

.........and it sounds like the seller is not prepared to sell it for less than 250k if they're asking for offers between 250 and 275.......

I can't imagine anyone accepting a cheeky offer from a buyer who's trying to knock a fifth off the asking price, either. Cloud cuckoo land that is......

ukcarper

According to Land Registry the average price of a flat in surrey in 2002 went fro £123k to £143k they are now £192k. They were between £164k & £176k in 2006.

Mickygg

The thing the OP has not taken into account is regional variation. Across the UK prices may be at 2006 levels, but not in Surrey. Since 2006 house prices have increased by over 10%.

breadlinebetty

ukcarper wrote: »

According to Land Registry the average price of a flat in surrey in 2002 went fro £123k to £143k they are now £192k. They were between £164k & £176k in 2006.

AVERAGES are just that : averages.

You can't possibly determine how much a flat costs just going by the average price for a 'flat in Surrey'

Surrey is a huge area and poperty pices differ according to:

Where in Surrey the flat is

Which road the flat is in

Is it in the sought after end of the road or the less salubrious?

The flat itself: what features it has, the size rooms, condition, decor, views etc

Is the flat a one.two/three bed flat?

Is it in a communal block or a convesion?

What year was it built?

Does it have peiod features?

Does it have private paking?

Does it have a gaden?

Are there mainrenance fees?

Is it close to local ameneties. transport etc?

Is it an ex LA popert?

Is it close to a council estate?

The list goes on and on and on........

So NO average can possibly tell you how much one specific flat could cost.

Depending on all those variables you could possibly pay anything between £150k fo a flat in Surrey right up to £1.5Million....or more..

ukcarper

breadlinebetty wrote: »

AVERAGES are just that : averages.

You can't possibly determine how much a flat costs just going by the average price for a 'flat in Surrey'

Surrey is a huge area and poperty pices differ according to:

Where in Surrey the flat is

Which road the flat is in

Is it in the sought after end of the road or the less salubrious?

The flat itself: what features it has, the size rooms, condition, decor, views etc

Is the flat a one.two/three bed flat?

Is it in a communal block or a convesion?

What year was it built?

Does it have peiod features?

Does it have private paking?

Does it have a gaden?

Are there mainrenance fees?

Is it close to local ameneties. transport etc?

Is it an ex LA popert?

Is it close to a council estate?

The list goes on and on and on........

So NO average can possibly tell you how much one specific flat could cost.

Depending on all those variables you could possibly pay anything between £150k fo a flat in Surrey right up to £1.5Million....or more..

Very true but it does show than in general prices in Surrey are higher than 2006 and that £275k might not be unreasnoble.

Of course the best thing to do is to compare the price with that of similar properties that have sold recently.

AlexMac

I think that generally, the market is overpriced in that sellers in some areas have exaggerated hopes of a sale price based on values a couple of years ago at the 2007/08 market peak.

You also generally don't want the dearest house in the street- best to buy cheap in a dear street than vice-versa. Having said that, I've noticed that really good homes sell fast even in today's 'buyer's market'; we did incredibly well last year, selling for 20% more than we dared hope.

As I said recently in another post, do your homework to strenghthen your bidding position. Check Zoopla or other websites for sold prices, when comparable properties sold, current values and especially, their trends graphs for values in the street or area concerned.

You might be surprised- in many areas, prices have dropped 20% since their 2007 peak, sales have slowed and properties are not selling as fast as they did (you can see when the property was 1st marketed) but many vendors still have unrealistic expectations. You can then go to to agent to say what your offer is based on, orally, or better still in writing. If you also spell out what a good buyer you are (potential lender identified, mortgage offer agreed in principle, evidence that you have deposit funds in place, named solicitor identified so the agent can write up the 'memorandum of sale' the day they agree..?) you will talk up your appeal.

I did this recently and the agent was able to say to their client that the offer was locgical and the buyer robust (thus making more palatable my offer of £152k on a home which was up for £160k, and already had been cut from £175k. Good luck