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House sale logic
w00519772
Posts: 1,297 Forumite
I realise a house is worth what someone will pay but I fail to see the logic in them sometimes.
For example, this house recently sold for 170K: http://www.zoopla.co.uk/property/24-blackfriars-road/lincoln/ln2-4ws/13349569. The adverts suggest it was on the market for a while. This property was last sold in 2006 for 185K, so the vendor took a 15K hit.
There are other houses in the same area that follow this pattern. However, there are other examples where the vendor sold for much more than they paid.
Surely the surveyors report would stop someone overpaying (assuming they are not a cash buyer of course)?
For example, this house recently sold for 170K: http://www.zoopla.co.uk/property/24-blackfriars-road/lincoln/ln2-4ws/13349569. The adverts suggest it was on the market for a while. This property was last sold in 2006 for 185K, so the vendor took a 15K hit.
There are other houses in the same area that follow this pattern. However, there are other examples where the vendor sold for much more than they paid.
Surely the surveyors report would stop someone overpaying (assuming they are not a cash buyer of course)?
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It could be that the houses attracting higher prices had had improvements such as a new kitchen or bathroom?0
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a house is worth what someone will pay
It is indeed true. Sometimes sellers' or buyers' personal circumstances may distort the price. If buyers fall in love with properties, they will pay more. If vendor needs a distress sale, s/he will accept less.
There is no other logic involved
Happiness is buying an item and then not checking its price after a month to discover it was reduced further.0 -
The survey isn't there to stop someone paying more than the value of the house. It is there to stop the lender lending more than their stake in the property. People that have big deposits can pay more than the value of the house without the lender or survey report caring.This is a system account and does not represent a real person. To contact the Forum Team email forumteam@moneysavingexpert.com0
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I realise a house is worth what someone will pay
No.
A house is worth whatever value both a willing and able buyer and a willing and able vendor can agree on.
Without both parties agreeing to the sale, there is no sale, and therefore what a potential buyer thinks it's worth is of no relevance.“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0 -
HAMISH_MCTAVISH wrote: »No.
A house is worth whatever value both a willing and able buyer and a willing and able vendor can agree on.
Without both parties agreeing to the sale, there is no sale, and therefore what a potential buyer thinks it's worth is of no relevance.
I would disagree with this. The market value of a house at any given time is what someone is willing to pay for it. Nothing else is relevant to a property's market value.
Of course, there are many good reasons why an owner may not wish to sell a property for it's market value, but his or her opinion is irrelevent in terms of what the market value is. The market value is quite literally what someone will pay for it.
You're right though of course in that without agreement, there is no sale, so arguably the point is somewhat moot anyway.0 -
I would disagree with this. The market value of a house at any given time is what someone is willing to pay for it. Nothing else is relevant to a property's market value.
Of course, there are many good reasons why an owner may not wish to sell a property for it's market value, but his or her opinion is irrelevent in terms of what the market value is. The market value is quite literally what someone will pay for it.
You're right though of course in that without agreement, there is no sale, so arguably the point is somewhat moot anyway.
The 'market value' is a mean or average of some kind, so is difficult to apply to a specific transaction.
An individual sale (like the example in the OP) actually requires the agreement between buyer and seller.0 -
The 'market value' is a mean or average of some kind, so is difficult to apply to a specific transaction.
No it's not.An individual sale (like the example in the OP) actually requires the agreement between buyer and seller.
Thus establishing a market value for that property! The very definition of it in fact.
What something is "Worth" is utterly subjective. You often see promotions offering some free gift that the promoter says is worth £9.99 or whatever. If I don't need or want it, it's actually worth precisely sod all.0 -
I think you know what i mean... a house isn't a mars bar and can't be priced in the same way.No it's not.
sounds like we're in agreement! When a sale occurs (ie. agreement between buyer and seller) then the worth of that house to that buyer becomes evident.Thus establishing a market value for that property! The very definition of it in fact.
Not a great analogy imo - but what if you do want to buy it and i don't want to sell it to you at that price?...you might have to tempt me with a bit more money.What something is "Worth" is utterly subjective. You often see promotions offering some free gift that the promoter says is worth £9.99 or whatever. If I don't need or want it, it's actually worth precisely sod all.
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Not a great analogy imo - but what if you do want to buy it and i don't want to sell it to you at that price?...you might have to tempt me with a bit more money.
There's no fundamental disagreement here just a bit of semantics I think.
If I don't consider what you're selling to be "worth" the money then I don't buy and you don't sell. We have different opinions on the "worth" of the thing and fail to establish a market price.
Somebody else might come along and pay your price and you can then say this is market price but it doesn't necessarily change my own subjective view of the worth of the thing to me.0
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