Buyers - do not pay the prices the greedy sellers want

Snow_Dog

Remember, "the value of your investments may go up as well as down"

However, the value of your home should be irrelevant while you can keep paying the mortgage as its your home

chappers

Conrad wrote: »

Some sellers seem to inhabit a parallel universe. The worst are those that blame agents for being unabkle to achive thier sellers greedy aspirations.

Whilst I agree with most of Conrads post and most of his usually good advice, I too believe that agents must take a fair bit of the responsibility for the price properties are marketed at.
My wife and her brothers have been selling a property that they inherited, in fact they accepted an offer today.
Three estate agents came round to value the property, which is dated has not been lived in for 10 years and generally needs about 15K spending on it to get it to top market price, which through research I gauged to be around £101K.
The three agents valued the property at £85K, £80K and one said they would easily get £95K plus for it, well guess which one Luci's brother decided to go for yes thats right the big fat £95K.
The estate agent knew the property wasn't worth that but when James said he had other valuations the estate agent saw a chance to get the business and lured him in.
I crunched a few figures for them and worked out to get an investor interested but sell the house for a reasonable price they should take any offers over 85K. well initially there were quite a few viewings but, no offers over £80k.
The estate agent then said she maybe had a buyer and he came and viewed and put in an offer of £81K, she advised James to take it as she thought that was all they would get and it was probably fair as the property needed 30k spending on it.(very strange after being so confident of getting 95K+).
She tried all sorts of BS saying that the buyer wouldn't be able to get a mortgage on the property as the kitchen was in a lean to and that he only had £81k cash.
Any way I advised them to just hold tight for a bit as there was one more viewing that week, before the viewing the same guy upped his offer to 82.5K(again recommended to be taken by the EA) and said he would clear the house out himself and no survey.I told them to not even reply to that and wait until after the last viewing and if no other offers were made to go back and tell the guy 85K and it's yours.
Well luckily the last viewing drew an offer of £85K which prompted the original guy to make an offer of £87,250 the estate agent then suddenly took interest and tried to start a bidding war but the other people wouldn't go above that so they accepted the offer.
The house two doors down also sold last week for £105K and that is in immaculate condition so I don't know where the Ea got a price of £95K from.

Sorry to ramble on but my point is the estate agent knew the property was really worth about £80-85K hence the urging to accept those offers, but used a big juicy price to lure James into using them.
The thing that really !!!!ed me off about the whole thing was the BS that she came up with, contradicting herself all the time, she didn't have agood enough memory to be the liar she was.

Once people have a price set in their mind that they want to sell their house for they are usually very reluctant to drop from that, a lot of this overpricing is brought about by EAs greedy for the business and not always sellers greedy for the cash.

Anyway all turned out well in the end he is a cash buyer and they are exchanging on Wednesday(the advantage of James being a solicitor himself and also knowing the buyers solicitor too).

nelly_2

merlinthehappypig wrote: »

It's not simply a matter of greed, it's adjusting to a new reality.

Many sellers, especially those with properties that have been on sale for a year or more, have already 'fixed' a price in their minds and will find it difficult to adjust to their house being worth less.
.

I fixed in my head i was gonna shag keira knightley I'm finding it difficult to adjust to the fact it aint happend too

Dr_Moe_2

I have to agree with chappers. I was messed around for months by a vendor and his EA.
I viewed a house in November- had been on market for 4 months, initial asking price £275K, dropped to 270K and finally £265K after three months. The house was an extended 4-bed semi (in a good area) but was badly presented, needed a full cosmetic makeover, bathroom was tiny and outdated, extension badly done, built-in cupboards needed replacement, etc.... I thought the house was not worth more than 250K and given that it was a buyer's market, I put an initial offer in for £230K. This was met with discontent by the vendor and the estate agent. The EA accused me of not being a 'serious buyer' and made fun of my offer. When I tried to point out the amount work that the house needed, I was told that the the house only needed 'cosmetic touches' and didn't need any structural work (e.g. roof repair). He was so abrupt and arrogant so I told him I wasn't going to increase my offer and that I didn't want to deal with his agency (or his client) because of his stinking attitude.

The house remained on the market for another month with no viewers or offers. the vendor refused to reduce the asking price and instead instructed a bigger estate agency to market the property. To cut a long story short, I ended up bidding for the property again through the same abrupt EA (he called, apologised and informed me that the vendor was willing to accept offers below stamp duty threshold). I put an offer in and it was accepted but the vendor screwed us both and sold the property to someone else. The estate agent got so upset about losing his commission and had very heated discussions with the vendor and his solicitor. He then phoned me up and started ranting about the vendor and how he would kick him out if he was ever to step foot in his office. He told me that he thought the house was 'awful' from the beginning , that he told the vendor that it wasn't worth more than £250, that it was badly presented and needed a complete makeover, and that he wouldn't pay more than £230 for it. When I pointed out that he'd previously been quite disrespectful and abrupt about my initial offer, his responses were: 'I represent the seller' and 'I have to make a living'.

Sorry, but I have no sympathy for estate agents what so ever. Some of them would sell their souls to the devil to get their 2% + VAT.

chappers

Every now and then you come across a decent EA, I bought my investment property through one and he has helped me ever since with market information, always returned my calls and phoned me when he said he would(all in the name of cultivating good customer relations), and because of this i would probably use him when i come to sell again.
However there are so many out there who are only in it for themselves.
The EA you dealt with Dr_Moe sounds like a complete ar5e but at least he was doing what he should and acting on behalf of the vendor

wisbech_lad

nelly wrote: »

I fixed in my head i was gonna shag keira knightley I'm finding it difficult to adjust to the fact it aint happend too

Well, in my head I have, many times. Sometimes along with Scarlett Johanson

Nenen

merlinthehappypig wrote: »

Bear in mind that most people are not as financially capable as many of us on here. They genuinely believed that prices couldn't go down and aren't always capable of realising that if their house is worth less they can claw the difference back on the next house.....

We have been 'encouraged' to believe that a valuable house makes us rich. Most people can't comprehend the difference between a paper worth and an actual worth.....

Yes, some of this is greed, but much of it is naivety with a healthy dose of stupidity, not helped by agents, lenders and the government. Much of the greed can be attributed to those who encouraged this madness. When you see your friends & neighbours making huge paper profits it must be hard for people not to get swept up and make the wrong decisions.

I couldn't agree more Merlin but it is not just the less intelligent who suffer from 'desperation for house prices to remain high-itus'! I'm ashamed to say I spent almost half an hour showing a teaching colleague (who seemed to understand percentages ) how a hpc would actually benefit her as she wants to trade up from a 2-bed terrace to a 3-4 bed detached in this area. At first she was horrified her house could go down by even 10% and didn't want to listen but I doggedly showed her all the maths for what happens in a falling market and I thought I'd convinced her that as prices drop the difference between 2-4 bed houses in the same area (and hence increase in mortgage) narrows. I believed I'd cracked it and she seemed to understand... only to hear her telling another colleague a few days later that she thought her house would retain its value and she was so relieved that house prices in Cambridge always stay high!

And I thought teaching children was difficult!:D

note to self.... in future save your breath and don't try to tell anyone who owns a house in Cambridge that the value might actually go down!:wall:

Conrad

Gorgeous_George wrote: »

When I sell anything, I decide, with the help of experts if necessary, how much I want to sell it for. I advertise the item for sale and wait for offers. If no offers are forthcoming I review the price/advertising and remarket accordingly.

A phenonemon (sp) I've noticed over the years is where potential sellers exert subtle pressure on EAs to value higher. This comes in many guises, but one example is where the person is very house proud and exentuates points about thier home that they feel mark it out from others.

They say 90% of communication is non verbal and thats another way potential sellers exert thier opinion.

EAs are only human and some are bound to cave in to this pressure and go along with the seller in order to get the instruction, but remember EAs earn nothing from an over priced property cluttering up thier office.

Conrad

Nenen wrote: »

. I believed I'd cracked it and she seemed to understand... only to hear her telling another colleague a few days later that she thought her house would retain its value and she was so relieved that house prices in Cambridge always stay high!

And I thought teaching children was difficult!:D

Classic - something I witness time and again!

People have this inbuilt idea that prices wont fall in thier area - pitifull really.
As I keep saying my father in law had a house in the best road in Hadly Wood, a place of stars and brain surgeons. It dropped 50% in price last time.

I live in area with amazing schools,, no chavvy bits, no crime, not far from London, very picturesqe, yet I am perfectly sure prices will fall here.

izzybusy23

Conrad wrote: »

I've been in mortgages since 1991 and can say with some conviction that prices are falling.

Why? Because a large proportion of the money supply has been removed from the mortgage supply chain. You cant expect a fire to burn as brightly with less fuel - it's really that simple.

Greedy sellers somehow consider 'thier' property to be special, which is a common psychological response given thier emmotional engagement with thier property.

1) International money markets have dried up so there's a lot less money available to lend

2) LTVs are being reduced and 100% lending is all but dead and some lenders pulling back from 95%

3) Income multiples and other criteria mean lenders are advancing applicant lower sums

4) The cost of borrowing has gone up since the end of the boom


Some sellers seem to inhabit a parallel universe. The worst are those that blame agents for being unabkle to achive thier sellers greedy aspirations.

Im particularly amused by the "prices wont fall in my area camp". EVERY area has a proportion of people that retain this view.
Well in the last crash homes in Hadley Wood, Herts, a mega money enclave, halved, so it really can happen anywhere.

I don't intend to pay the prices the greedy sellers want.... I am happy to sit it out 5+ years if I have to. They won't get one penny more than I think their BRICKS and MORTAR are worth...