The Nationwide Building Society has confirmed that house prices are now falling at the fastest ever rate in the last 18 years.
In fact they are falling so fast that within a couple of months, that statistic could read ‘since the war’.
Yesterday I had a call from a desperate seller in my local area. I asked her the usual questions to find out how much she thought the house was worth, how long it had been on the market and if she had any offers at all.
She replied that the house had been on the market for a year. She had had no offers. The agents had recently reduced the price but still no offers – that’s why she was calling me for a fast sale.
I am always straightforward with sellers and so I suggested that if she didn’t need to sell then why not just ride out the slump and wait until things got better? Why sell to an investor today?
She said that she and her husband were desperate to move to another area.
However, she must achieve her full asking price because that’s what the house was worth. I politely suggested that if it was worth the asking price then it wouldn’t have been without offers since September 2007 (this is in a good area and before the crunch really took hold).
I asked her if she was prepared to rent for a while if she moved. Her reply was astonishing: “Oh, no I would never rent, house prices are crashing down and so I’d just put in a cheeky offer on someone’s house and pick it up cheap.”
Unfortunately this is a classic case of home seller’s logic. Our own houses are always worth top dollar, but when we buy other people’s houses are always over priced!
Many homeowners have never been in the situation where houses do not sell quickly and for their asking price (or more).
For many people facing repossession right now, or forced to sell for any other reason, there simply are no buyers. Even property investors have been hit with around 80% of them no longer buying because of the cost or lack of availability of buy to let mortgages at affordable rates.
That leaves homeowners who need to sell in the worst position in nearly 20 years. If you must sell, you may find that simply selling for the amount that you owe and at least being debt free is far better than waiting for the bank to repossess your home.
Having said that, a huge number of homeowners have mortgages with negative equity and houses are simply not being valued by surveyors at the prices that sellers need to achieve.
If you need to sell and are realistic about your options, you can contact me using the form below:
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