Can't make sense of asking prices!

Duskylady

Hello hoping someone can help me understand the position that we are in.

My OH and I are first time buyers with a deposit and a budget of around £200k We have been viewing properties all week and can't make sense of the differences between property asking prices and the sold prices from the land registry.

For example
3 bed semi on the market for £215 in need of modernisation throughout (really old bathroom and kitchen and dated decor but nothing beyond our abilities.

However when we were looking at sold prices for the same street the house next door (smaller but newly fitted out) was sold last year 2012 for £195 and another house on the same street (same size better finish) was sold for £195 in 2011. Nothing on the street has ever sold for more than £195!

House has been on the market for a while.

Whilst we could stretch our budget I would've worried about buying a house and spending loads on modernising throughout only to end up with a house worth less than we'd payed for it.

I'm tempted to put in an offer for about £185 with an absolute max of £190 but this seems so far from the asking price I am questioning my judgement.

I have tried to be balanced and not look at just one example house and even looked in the surrounding streets, we have driven past to check the houses are the same and checked the property details to see if the interiors are similar I can't understand what i am missing.

It seems to be the same story with the other properties we are interested in they seem to be priced way way over the actual selling price of similar properties.

Is the overpricing deliberate and its understood that the house will sell for much less or am I seeing the results of a fairly substantial house price rise over the last year.

By the way we live in chester if that makes any difference.

Any insight would be greatly appreciated.

gazzabboi

I would assume that the sellers are looking for 200k, if you was to offer, start at 190k and end up looking at getting it for 197k final offer. Its not selling because its overpriced. I wouldn't think you have much chance of getting it for 185

Tumtitums

Im a first time buyer and i think the situation is mind boggling. Be aware that when you choose one a valuer from the lender and your own surveyor will give you a professional estimate of the true price

rrtt

Hi - I'm no expert but was looking for over a year in mid-Yorkshire (happily just had an offer accepted on one).

I think there are 4 poss reasons for this

1) People (with vested interest from Estate Agents) fly a kite with a guide price, expecting any actual offer to be considerably less

2) Some people who may only have owned the properties for a relatively short time (eg 3-5 years) are blissfully unaware (or selectively blinkered) that even in that short time, property prices have actually dropped overall (depending on area of course)

3) Some people who bought at the height of the market and have invested quite a chunk on improving their properties, have completely unrealistic expectations about recouping their total outlay

4) Some vendors just have unrealistic expectations, end of!

ValHaller

rrtt wrote: »

Hi - I'm no expert but was looking for over a year in mid-Yorkshire (happily just had an offer accepted on one).

I think there are 2 poss reasons for this

1)

2)

3)

4) /QUOTE]

5) (of 2) Some sellers have so much mortgage and secured debt that they cannot afford to sell for much less than they are asking

rrtt

ValHaller wrote: »

rrtt wrote: »

Hi - I'm no expert but was looking for over a year in mid-Yorkshire (happily just had an offer accepted on one).

I think there are 2 poss reasons for this

1)

2)

3)

4) /QUOTE]

5) (of 2) Some sellers have so much mortgage and secured debt that they cannot afford to sell for much less than they are asking

True, and I don't seem to be able to count when tired either

jbainbridge

You're not missing anything. Offer what _you_ think it is worth. Maybe qualify your offer by stating example sold prices and the property condition.

Also use FireFox and Propery Bee which will give you an idea as to how long properties have been on the market and what changes they have made to hte marketing.

Duskylady

Thanks it makes me feel like I am not missing something

I think I will just make offers I'm comfortable with from my own research and not let the asking price worry me.

We are happy to walk away from a house rather than offer something we're not comfortable with. I would rather take a bit longer and find something I would consider to be reasonably priced.

OH thinks the whole process is crazy so offers and understanding what to offer etc will be up to me. (With the help of this forum :T) He will be in charge of renovations though so it seems like a fair deal to me

Guest101

Duskylady wrote: »

Hello hoping someone can help me understand the position that we are in.

My OH and I are first time buyers with a deposit and a budget of around £200k We have been viewing properties all week and can't make sense of the differences between property asking prices and the sold prices from the land registry.

For example
3 bed semi on the market for £215 in need of modernisation throughout (really old bathroom and kitchen and dated decor but nothing beyond our abilities.

However when we were looking at sold prices for the same street the house next door (smaller but newly fitted out) was sold last year 2012 for £195 and another house on the same street (same size better finish) was sold for £195 in 2011. Nothing on the street has ever sold for more than £195!

House has been on the market for a while.

Whilst we could stretch our budget I would've worried about buying a house and spending loads on modernising throughout only to end up with a house worth less than we'd payed for it.

I'm tempted to put in an offer for about £185 with an absolute max of £190 but this seems so far from the asking price I am questioning my judgement.

I have tried to be balanced and not look at just one example house and even looked in the surrounding streets, we have driven past to check the houses are the same and checked the property details to see if the interiors are similar I can't understand what i am missing.

It seems to be the same story with the other properties we are interested in they seem to be priced way way over the actual selling price of similar properties.

Is the overpricing deliberate and its understood that the house will sell for much less or am I seeing the results of a fairly substantial house price rise over the last year.

By the way we live in chester if that makes any difference.

Any insight would be greatly appreciated.

Just remember a house is worth exactly what the vendor will accept for it. He could ask for 400k, he wouldnt sell it, but thats his asking price.

Riggster

Asking prices in Chester are generally over inflated. I would say they sell for around 10% less than they're originally marketed for. People just think their house is worth more than it actually is.

Except my house in Chester...:p

I_have_spoken

Nothing on the street has ever sold for more than £195

In that case, the sellers has near zero chance of besting the highest price in the street with a 'project' property.

Chester seems to have gone nowhere price-wise in the last 12 months.

I'd say £185,000 tops.