THE present state of the property market recalls the phrase used by the great
West Indian fast bowler Joel Garner whenever he found a wicket that had lost
its bounce. He would impatiently stamp his foot on it, shouting: “She gone
to sleep, man!” Today’s estate agents share exactly Garner’s sense of
frustration when they talk of the property market, which is similarly
“sleeping”. Yet that doesn’t mean to say that vendors have given up hope.
Take Jane and Will Mulder, pictured with their daughter Bea, who are in a
hurry to sell their New England-style house in Pulborough, West Sussex.
Jane, a writer, has thrown herself into the task. “We know that the right
buyers are out there – it’s just a question of finding them,” says Jane.
“They are going to be younger, probably City-based, with enough imagination
to appreciate the Marrakesh influences of our interiors.” The house, which
has been on the market for eight weeks, isn’t your conventional fourbed
detached with shiny white en suites. The bluey-grey clapboard frontage opens
into a 30ft-high reception room with huge windows. Highly individual in its
decor, there is a fitted oak day bed, the walls are in russets and reds, and
everywhere there are plants and books, drapes and heavy furnishings.
Upstairs is a hammam-style bathroom with an elevated double bath and lined
with Moroccan tiles.
Jane has contacted several property search agents directly and has e-mailed
everyone in her contacts address book, offering a £2,500 fee to anyone who
introduces her to the viewer who buys the house. “It’s essential to get your
estate agents on-side with these kind of initiatives,” she says. “We are
treating this sale as fun, like a treasure hunt for the right buyer.”
The Mulders’ home, which is on the market for £825,000, is in the price
bracket that is most likely to “stick” at present. “We are selling homes at
over £5 million quite easily,” says Crispin Holborrow at Savills. “It’s the
homes below £1 million that are proving slower to sell.”
Estate agents, too, are trying to be more inventive. “You have to ‘do a
Madonna’ – constantly reinvent the home that is sticking,” says Serena
Brown, of Browns. “A house may have a great view – something we may have
underplayed in our initial marketing – so we’ll get fresh pictures taken and
really stress that aspect of the house for a few weeks.”
Just as rigor mortishas hit the market, so the designers have opened up
new services. THis Designs Ltd has a “dress to sell service”. Its game-plan
is to give your home a “wow” factor in every room – something to catch the
home viewer’s attention, without making the style appear too personalised.
Its fees range between £8,000 and £150,000. Isn’t that a trifle excessive
for a makeover? “Not when looked at as a proportion of the selling price,”
say Robin Knudsen, at THis Designs.
“Buyers are incredibly sensitive of the slightest problem now,” says Tim
Lawson, the search agent for Property Pathfinder in Cirencester. “Being too
close to a road or near a farm, or simply in the postcode where there has
been flooding, are suddenly major issues to buyers.” He has much to say
about estate agents.
“Be careful who you instruct,” he says. “Estate agents are short of clients in
this market and one way they can secure your business is by valuing your
home overoptimistically, which does you no favours at all. Test your agent.
How many sales have they made in the last three months? How many hits have
they had on the website? Why isn’t your house selling? There must be a
reason!”
The Deck House in Pulborough is for sale through Hamptons International,
01403 211766, for £825,000. www.brownsestateagents.com www.propertypathfinder.com www.thisdesigns.co.uk
For everything you need to know about home information packs, go to: timesonline.co.uk/hips
PROBLEMS IN THE PROPERTY MARKET: REGION BY REGION
YORKSHIRE & HUMBERSIDE
Prices here will drop, which is no bad thing as it will bring back another
raft of first-time buyers. There will not be a total meltdown but it will be
a challenging six months. David Pank, Manning Stainton, Leeds
NORTH WEST We have a real problem with flats. There are partially-built
apartment blocks which developers are going to struggle to sell at the
prices they hoped. Richard Powell, Ryder & Dutton, Oldham
MIDLANDS Everyone’s had the wind put up them – people will either do
nothing or make low offers until March. Quentin Jackson-Stops,
Jackson-Stops & Staff, Northampton
LONDON The fringe areas of the capital will suffer first and suffer
most. These may be the same places that have been labelled “up and coming”
in the last few years. Tim Le Blanc-Smith, John D. Wood, London
SOUTH EAST There is a definite oversupply of flats, with a number of
local repossessions occurring and up to 30 per cent falls in value in flats. Peter
Constable, Cluttons, Maidstone
SOUTH WEST The South West will do much better than most other parts of
the UK. It will still be less of a sellers’ market and guide prices will
come down slightly. William Morrison, Knight Frank, Exeter
SCOTLAND There will be increasing polarisation: older properties in
prime areas will outperform, properties built in unfashionable eras from
postwar to 1990 will have a difficult time. Anthony Perriam, Rettie &
Co, Edinburgh Buyer or seller? Tell us what’s happening in your area
by e-mailing property@thetimes.co.uk
Ed, London. Estate agents are an occupation with no formal education requirements, no underlying enforceable ethical and regulatory code etc. In short, none of the traditional hallmarks of a 'proper' profession. If they chose (or were forced) to become a profession with a regulatory code, your issue could be addressed. Any agent who valued a property and then later persuaded the seller to drop the price significantly without an acceptable demonstrable reason would be subject to disciplinary action and the payment of compensation to the seller for the time wasted. This should at least give agents pause for thought when pricing glorified sheds at 850k.
Clive, Chichester, UK
Everybody is quick to hammer estate agents because of their tendancy to "over value" but has anybody paused to think why they do this? Clearly, the agent is motivated by achieving a sale, so taking property on their books that's overvalued isn't really helping them. The actual reason agents over value property is because they have to tell sellers what they want to hear. Most people will get 3 or 4 agents in to value. If 3 of these valuations come in at £800k and one comes in at an honest £650k, who do you think will get the property to sell? Certainly not the agent with the honest valuation. It's easy to be critical of agents over valuing, but think how you would react in this situation. Would you really instruct the agent saying the lowest price? We are all guilty of greed, not just estate agents.
Ed, London,
Having worked in the "City" for 20 years...any financial expert "young city type" working there with an eye on the declinging property market and cash to spend would
be focused on getting "best value". I would estimate that probably they would be looking to offer cica 300K for this property.
Be that now or in the next year or so.
David, London,
£800k for a kit house!. Some 'imaginative city types' have been spending too much time at Pete Dochetys parties.
Carl, london, uk
all those idiot estate agents who said house prices only ever go up because "Britain is an over-crowded island" are finding out what REALLY what has been driving house prices (banks' willingness to lend)
bruce, london,
I can't believe that someone is so deperate to sell after only eight weeks. I beleive that unless they make a substantial reduction on their asking price they are doomed to waiting perhaps a year, perhaps more. I think that buyers who are being put off by the slightest problems are really making an excuse to themselves not to buy. They know that in theory it is right for them to move, but are unsettled about the way things are going to turn out in perhaps a year or two's time, when their new perfect house will be worth substatial less.
Diddly Do, Liverpool,
spend £8000 on a make up but what happens when people are not coming through your door because the market is crashing, not money well spent is it.this is the worse market in living history and its goingto get worse £825,000 will very quickly become £500,000
but the greedy wont realise that until its too late.This crash is going to be very quick with casualties everywhere...
geoff kelly, chester, uk
Great advertising for them!
This is the wierd house featured on Grand designs as being a bit too individual? Maybe that's why it won't sell, or maybe its just too expensive.
Karen McMillan, London,
£850k for a clapboard - ahem - New England style house? Are they mad? Clapboard might work in New England but in Old England it'll be rotten with damp in no time.
This couple are dreaming. I'm hoping they're only asking for 850k out of greed rather than obligation brought on by a huge mortgage they can no longer afford. If it's just greed then there's still plenty of scope for them to drop the price to something more reasonable - like say, 300k
MB, Edinburgh,
Regardless of the "New England" style and Morroccan furnishings, maybe the real reason they can't sell is because no-one can afford to buy anymore.
Northern Rock, Paragon Mortgages, Kensington Mortgages. How many more signs do they want?
Paddles, London,
Their house will sell tomorrow if they follow my simple advice: Reduce the price.
Matt ODonnell, London,
The crash has started. When estate agents start forecasting drops, it's all over.
Estate Agents make their money on commission, i.e. volume - they don't really care if your house sells for £250k or £200k - they only care that it gets sold and they actually get the (slightly reduced) commission. With the credit crunch taking away buyer's opportunity to demand houses, the estate agents must now start managing prices down to maintain their commission volumes.
Most housing crashes take 5 years or so. We've just had the biggest house price boom ever, so now we're about to have the biggest...
Richard, Geneva, Switzerland
Those sellers are exactly the type who resolutely refuse to believe that property prices can drop.
They've been brainwashed by a glut of property porn into thinking that everyone in London works in the City, gets a huge bonus and desperately wants a house away from the "hustle and bustle" in the rectum-end of Sussex.
They'll probably end up tarting up the kitchen, landscaping the garden, converting the loft - again - but they'll NEVER reduce the price.
They've gotta face facts - the party's over. they probably had lots of friends telling them to bail out at the beginning of the year and ignored them because the Evening Standard said prices don't go down . . .
Justin Thyme, London,
Cut the price by 40% and I am sure it will sell!
david barker, maidstone,
THIS COUPLE PAID £270,000 FOR THEIR HOME WHICH WAS FEATURED BY CHANNEL 4. I found the link below on www.housepricecrash.co.uk.
see: http://www.channel4.com/4homes/ontv/grand-designs/houses/S/sussex_newengland-2.html
K, Milan, Italy
If its been on the market for 8 weeks and they haven't dropped the price yet,so they can't be in that much of a hurry. If I introduce them to my friend Reality can i have the finders fee?
Neil, Brighton, UK
Wales does't exist anymore then ?
J Hughes, Newport, Wales UK
Don't worry guys it'll sell eventually they all do...but at an auction in what's known as a distressed sale ...and at a fraction of the price they want unless GB allows inflation to run riot - (a favourite option of labour Govts in their dying days) -in which case have I got an £800k note and some small change - the debt has to be destroyed one way or another - either bad debts to the bank or inflation - who on earth can ever pay off a mortgage that large - and who with that sort of cash would spend it in Pulborough - its nice down here but not THAT nice!!. We've moved from being a country where you once paid off a mortgage over a lifetime (ie repaid the original loan - remember those days) to one where you can just about service the mortgage (ie cover the interest). This crash is long overdue and will make the last one look like a minor tremor!!!
steve, Brighton, UK
As one who has travelled the exact same Pulborough-Victoria route and hated very minute of the the 75-85 min journey every day, let alone door-to-station time, I fail to see how a 'city type' will be attacted to over-priced far-flung (from the capital) properties. If a house is on the market for more than 8 weeks it is simply over-priced. Forget hordes of 'city types' willing to trade up to a green field ghetto and price for the local market.
Stuart, Surrey (Ex-W.Sussex),
What about Wales and/or Northern Ireland? Do journalists not consider these as part of Britain?
John, Belfast,
Hilarious.
Mike.... Very amusing your input. Are you sure you are really from Winchester?
My Marxist fried was always quite funny when he said to a Daily Mail reading secretary of his that the way to measure house price increases is to equate them to basic needs. Therefore for example a £5m total annual rise in an area equates to say 200 times loss of teachers in the local schools at £25000 per annum average salary... (or cardiac nurses or whatever). Something that is actually really quantifiable...
Pete Balchin, Solicitor , Bristol, UK
Dear Mr & Mrs Mulder
Ask yourself a simple question. In saner times (soon to return) most sensible people would pay about 3 to 3.5x their annual income for a property. How many people in or around Pulborough earn in excess (solely or jointly) of 270k pa? Even if you factor in that a typical buyer of your house will be trading up, you're still looking at someone having to borrow ridiculous income multiples to buy your place. As others have said, drop your price by 10% or so now and get rid of it quickly. Otherwise, you're looking at losing half the value within the next three years or so.
Clint, Staffs, UK
The market has turned and it is unlikely to come back any time soon. The scale of huge unrecoverable (retail, corporate and investment) mortgage debt is just starting to become apparent. The credit crunch is in its early stages and mortgage I/R are disconnected from base I/R. The laws of mean revision will pull prices of UK property back towards their long term average, so we will see falls as we return to pricing/value based more on fundamentals.
Best to look the Estate Agent in the eye and ask the question "What can you actually sell our property for today (or say within 3 months)". The answer by definition is not the 'aspirational £825k'. Better to get it away in the next 3 months at the 'effective market price of today' , say £750k? Rather than chase the market down and sell £650k or lower in late 2008/early 2009?
No one should get emotional about this as property valuations are just opinions, until a sale to completion crystallises that opinion into an 'effective market value'.
Good luck!
Pablo, Poole, UK
When they've finished playing games and having fun they'll realize that property is over valued by 40 per cent in this country and that the house is actually worth 495k. The impending housing market crash will see to it that a fair sum is paid for their property. i wish them good luck.
Kev, Hampshire,
"Marrakesh influences of our interiors"? Keep dreaming. When most people create "Morrocan-influenced" design, they paint a room orange and hang up some mirrored tile. Ugly. I cannot imagine what these people's lounge looks like.
John F, London,
Hilarious! I couldn't agree more. Everything will sell if its at the right price. I imagine they will wait, in the vain its worth more than that stubborn way and then be forced to sell at later date for far less
david connor, bognor regis,
Oh dear! What a pair of half-wits. 'We're treating finding a buyer as a game!' Good luck with that one. 'We know the buyers are out there, we've just got to find them'
Have they looked in people's garages and sheds. That's what I did when I couldn't find my cat!
Hmmm, let's think. I want to buy a house in an area. I register with all the local estate agents and look on the web. I wonder what she thinks the 'hidden' buyers are doing? Spending their money on not such overpriced rubbish perhaps.
Damn those pesky hidden buyers!
Mike Wilson, Winchester,
Not so much a report on the housing market as a thinly veiled attempt to sell a house, obviously the writer of this article wants the £2500 into fee !!
Martyn, Chester, UK
They only people with enough imagination to appreciate their interiors at that price are themselves!
Colin, Glasgow,
I think this pair should read the city pages, there is no credit available and the 'city' types that are trying to attract are currently looking over their shoulder at a large looming axe. There are also a LOT of ameteur buy to letters sitting with large mortgages and empty properties, looking at an increase in interest rate. I think they would be wise to drop to a sensible selling point. and head for the hills as the floodgates of the ex-buy-to-lets properties are opening.
One last definition - A sensible selling price is one that the property will sell for, not one that an estate agent has made up. If the property will not sell, it is to expensive to interest people and therefore by definition (see above) priced to high. It is that simple.
john , reading,
If it wont sell, drop the price. A hard lesson to learn but true.
Property will always sell at the right price, but the market is heavily overvalued at the moment. Better to take a 5 - 10% hit now than stick on the market and reduce by 20% later.
Chris, Bedford,
“They are going to be younger, probably City-based, with enough imagination to appreciate the Marrakesh influences of our interiors.â€
Er, hello. Are these two for real?
Vicky, Germany,
What a load of cobblers!!
If the house is cheap enough, someone will buy it!
paul, east dulwich, london
Anything on Wales?
Mark, Porthcawl,