Housing market: what's the latest?

[James]

Hello and firstly apologies if I should be attaching this to an existing thread.

Just wondering if anyone knows anyone buying/selling locally at the moment and how it's going.

I'm a bit perplexed because my lovely flat seems to be attracting scant interest. I know I'm biased (!) but I am genuinely surprised at the lack of viewings. So I'm trying to work out whether:

a) My estate agent is ****

b) The market is ****

c) I just need to be more patient

Any views on the subject or anecdotal evidence much appreciated! Thanks

[StraferJack]

all of the above probably, as well as the price is probably too high

We have just had a number of agents around to price up our flat and all of them suggested a price I considered too high

I've put it on lower than that, but I'm still not optimistic

[Loz]

I have been searching of late. August was really slow. September picked up, but not as much as in previous years. The general thought is that people are battening down the hatches and staying put.

SJ is right - properties priced reasonably are selling. It is still a slight buyers market out there, so expect offers near to your price, if that price is competitive. Drop the asking price ?20k and see if that arouses interest. Unless you are with Foxtons, in which case drop it ?50K.

[peterstorm1985]

Doesn't matter how good the flat is inside, if there's something nasty on the details the estate agent hands over to potential buyers then you've got trouble. Is there anything? Do you live above a funeral directors or in an ugly high rise block? If not, then it's the price. Get a mate to pretend to want to buy a flat and get a bunch of details of other properties that the agent is selling in your price range, then see what's different.

[Loz]

Also, stick an ad on the EDF Residential property section.

[James]

Thanks for your replies, great to get your views and suggestions.

To be honest I was actually worried we were a bit UNDERpriced. Comparing our flat to others at similar prices I can honestly say I think it's pretty keenly priced. There are some of comparable size & location around ?40k more! Have asked friends and work colleagues and they agree. Including the sort of people who definitely don't pull punches. When I see a property that's overpriced it instantly puts my back up so we deliberately avoided this.

No hidden nasties either... the agent tells us that the people who've viewed it have had only positive things to say. Which makes us all the more confused as to why there have been so few viewings and no offers.

[Loz]

Which agent?

Is it in the window?

Is it listed on Rightmove & Globrix?

I'd get some friends to do a mystery shopper exercise. I did that a few years ago when my house was on the market and the agent failed spectacularly. My friends virtually described our house/location and it wasn't suggested to them.

[red devil]

Why don't you post a link to where we can see your flat online, and then put your tinhat on... :)

[James]

Hahaha, am way too scared to do that (post a link)! Hmmm will think about it though, watch this space...

[benmorg]

James Wrote:

-------------------------------------------------------

> Thanks for your replies, great to get your views

> and suggestions.

>

> To be honest I was actually worried we were a bit

> UNDERpriced. Comparing our flat to others at

> similar prices I can honestly say I think it's

> pretty keenly priced. There are some of comparable

> size & location around ?40k more! Have asked

> friends and work colleagues and they agree.

> Including the sort of people who definitely don't

> pull punches. When I see a property that's

> overpriced it instantly puts my back up so we

> deliberately avoided this.

>

> No hidden nasties either... the agent tells us

> that the people who've viewed it have had only

> positive things to say. Which makes us all the

> more confused as to why there have been so few

> viewings and no offers.

You can work out if the flat is over/under valued by calculating the value backwards from the rental yield. The rent the flat would earn in a year if let out should be at least 5-6% of the sale value.

I would ignore the comparable properties on rightmove because a lot of them will be landlords who don't really need to sell chancing their arm at silly prices. Those flats won't sell. True market value is set by sellers who genuinely have to sell and are willing to accept what the market will pay, which may be less than expected.

My understanding is that flats have been a tough sell for a couple of years because the first-time-buyer market is pretty much crippled by the mortgage drought & high deposit requirements. But I think the last few months have probably seen a bit of a deterioration as a result of the euro crisis hitting sentiment. The riots can't have helped either.

Having said that, London prices are holding up better than prices in other place, so be patient - takes about 6-8 weeks to find a buyer normally.

[Kalamiphile]

My flat has been on for 10 weeks, regular viewings, very low price, needs work, no offers. The agents have come up with new reasons each week as to why they think it isnt selling, all of which they knew at valuation, which has gone from 150000 to 'hoping' to get you 130000. About to take it off as from what they say buyers are expecting too much.

[Cam123]

It seems to me that things higher up the property ladder are doing ok if they are fairly priced. We sold a house (3 bed 2 bath) at a good price, and we were gazumped on one that we were trying to buy. We are now in something of a bidding war on another property not too far from asking.

At the flat end however I think because of the lack of first time buyers, one bed flats are really really struggling. When you're forced to sell at a level which makes it appealing to an investor as there's no one else to buy it, you're going to be taking quite a cut on the price.

And whilst I think benmorg is spot on about valuing a flat according to it's rental yield, I don't know how well that will be working right now according to 5%-6%. I think investors are expecting more than that - and I think they can get it too. I've seen a flat in the Bellenden area sell in the last few weeks at under 170,000, and is on the letting market at 1200pcm - that would be nearly 8.5% yield. Using 5- 6% to value it, it would have been valued at something over 250,000!

I know that difference of over 2% is extreme, but it does serve to show the chasm between supply and demand and how far prices have to move before investment props them up.

I've been following the flat market in the area daily, both auction and private treaty sales for over a year now so if you wanted my honest opinion i'd be happy to give it if you want to PM the link - if it helps I will certainly have already seen it on rightmove and may have seen it in the flesh too.

[James]

-- moved topic --

[benmorg]

Cam123 Wrote:

-------------------------------------------------------

> It seems to me that things higher up the property

> ladder are doing ok if they are fairly priced. We

> sold a house (3 bed 2 bath) at a good price, and

> we were gazumped on one that we were trying to

> buy. We are now in something of a bidding war on

> another property not too far from asking.

>

> At the flat end however I think because of the

> lack of first time buyers, one bed flats are

> really really struggling. When you're forced to

> sell at a level which makes it appealing to an

> investor as there's no one else to buy it, you're

> going to be taking quite a cut on the price.

>

>

> And whilst I think benmorg is spot on about

> valuing a flat according to it's rental yield, I

> don't know how well that will be working right now

> according to 5%-6%. I think investors are

> expecting more than that - and I think they can

> get it too. I've seen a flat in the Bellenden area

> sell in the last few weeks at under 170,000, and

> is on the letting market at 1200pcm - that would

> be nearly 8.5% yield. Using 5- 6% to value it, it

> would have been valued at something over 250,000!

>

> I know that difference of over 2% is extreme, but

> it does serve to show the chasm between supply and

> demand and how far prices have to move before

> investment props them up.

>

> I've been following the flat market in the area

> daily, both auction and private treaty sales for

> over a year now so if you wanted my honest opinion

> i'd be happy to give it if you want to PM the link

> - if it helps I will certainly have already seen

> it on rightmove and may have seen it in the flesh

> too.

Cam123, you're right about the yield being higher than 5-6% at the bottom end of the market. 8.5% sounds right for auction sales, but I would have thought that sales on the open market are still getting higher prices?

It does sound like London or at least East Dulwich is coming off the boil.

[indiepanda]

A decent agent should be able to show you details of similar properties sold recently and what price they achieved (i.e. not asking price) to inform the setting of the price, that's what mine did the last time I sold. Thinking about it, some information on that is available on line

http://www.zoopla.co.uk/house-prices/browse/east-dulwich/

You can click through down to individual details of houses on there.

When I was buying I did notice that many of the agents were really rubbish at getting back to me with details of properties they had that were in my price range, even at setting up viewings where I'd asked to see a particular property. Foxtons were particularly poor on that front.

I do wonder if some of them are more focused on the lucrative rentals market at the moment? Might explain the poor service.

[new mother]

Is there any mileage in asking them to cite flats they have sold at that price per sf recently? similar streets obviously essential component...

[Kalamiphile]

I was told by agents after a number of investors had viewed and not made offers that they are looking for 10%

[Senor Chevalier]

I've been looking for a rental recently and several agents have told me about properties currently on their for sale book. According to them, not much is selling at the moment so after a while they start working on the vendors to consider renting for a year if they are a position to do so (that way the agent still gets a commission one way or the other).

I have to say I'm pretty nervous about the downside risk in the housing market right now...

[benmorg]

Sounds to me like prices are already tumbling again. I suspect the weakness will spread up the market and eventually affect houses as well as flats.

[Twirly]

benmorg Wrote:

-------------------------------------------------------

> Sounds to me like prices are already tumbling

> again. I suspect the weakness will spread up the

> market and eventually affect houses as well as

> flats.

I don't see how it can be any other way. Some of us buy flats to start with as houses are too expensive, then eventually need to trade up for more space or whatever. If we can't sell our flats, we can't trade up, so presumably the housing market further up the chain will be affected, eventually.

What will happen when the younger generation can't afford to buy at all as they've got ?50k of student debt to deal with, plus need ?20k for a deposit and are having to pay a significant proportion of their salary into their pensions, I don't know.

[womanofdulwich]

the deposit will via bank of mum and dad for some. mainly those whose parents have final salary pensions.

[new mother]

Is there any upside to be played in Nunhead? Just feels to me like ED is getting expensive - though worth it- and that there might be some easier and faster gains still over there? what do people think? Which is the best school currently?

[Jeremy]

I don't think it's wise to consider making a fast buck when buying a home. There are no guarantees. Choose an area and house you'd like to live in.

[v_the_gelfling]

Yeah it's funny, Nunhead has got a lot better. I purchased a property here 8 years ago, though at the time ideally wanted to live in ED but found the pricing too high. Now, i'm the other way round, I like to live here and just visit ED for restaurants. A couple of my direct neighbours had houses in ED, sold them and moved here with spare change so the area has changed quite a lot in terms of demographic and feels very chilled.

[lpool]

House market definitely seems to be holding up better than flat market. We rent a house locally and never seem to have problems finding tenants. Location, even within East Dulwich, also seems to count for a lot. We're fortunate to live in a good central location and any houses in our road coming on the market seem to go under offer within few weeks. Last one didn't even make it on to estate agent notice board.