Doom and gloom

[BlasterBates]

Hey Francko - like the Avatar...

Just read somewhere that Axa has just locked its commercial property fund.

[GeorgeGregan]

Estate agent friend of mine said that house sales are down partly because of the HIP and its associated cost. Apparently, Gov't said to them that if sales start heading south, they'll abolish them, similar U-turn as Darling's on CGT. Cameron said he'll abolish them, so it's a matter of who'll do it first. Sit tight is the best option atm.

The average studio above a chippy costs £200k, on a transaction that size do people seriously think that £500 on a pack is going to make one bit of difference to the market?

[TimberWolf]

The average studio above a chippy costs £200k, on a transaction that size do people seriously think that £500 on a pack is going to make one bit of difference to the market?

used to be worth

Perhaps not if the £500 came out of the sale price, but yes if it's an upfront cost whether or not the house sells. A significant number of people put a property up for sale to try their luck, and this punt could previously have been done for free. A £500 pack (is it really that much?) is a heck of a lot of money to spend on a house that doesn’t sell, particularly if the packs have a limited lifespan.

[AtW]

A significant number of people put a property up for sale to try their luck

In this country it seems people can easily pull out of sale - a friend of mine tried to sell the house in the last couple of years and people pull out practically after they agreed in writing to buy. This is bull - if you put your signature to contract then it should be binding full stop.

Talking of people who don't mean to sell house but just put it on sale then tough luck - they should not try to sell unless they plan to sell.

A £500 pack (is it really that much?) is a heck of a lot of money to spend on a house that doesn’t sell, particularly if the packs have a limited lifespan.

I think this is rubbish - house prices were going up by more than that in a month, so people who bought 6 months ago must have accumulated enough profit to afford that pack, they can (or could) get cheap loan using their house equity, and frankly if they don't have £500 then they are not really owners of anything.

[TimberWolf]

In this country it seems people can easily pull out of sale - a friend of mine tried to sell the house in the last couple of years and people pull out practically after they agreed in writing to buy. This is bull - if you put your signature to contract then it should be binding full stop.

True, but irrelvent.

Talking of people who don't mean to sell house but just put it on sale then tough luck - they should not try to sell unless they plan to sell.

What makes you think that they don't mean to sell their houses?

I think this is rubbish - house prices were going up by more than that in a month, so people who bought 6 months ago must have accumulated enough profit to afford that pack, they can (or could) get cheap loan using their house equity, and frankly if they don't have £500 then they are not really owners of anything.

Owning a house doesn't mean you can afford to throw away £500.

[AtW]

What makes you think that they don't mean to sell their houses?

If you put your house for "sale" just in case someone offers ridiculous price then it's not a sale - it's a gamble, it should not happen - it's like putting shares on sale with asking prices way higher than you can reasonably expect to sell them for - this sort of activity should not be free. Otherwise market get skewed.

Owning a house doesn't mean you can afford to throw away £500.

It's a cost of sale and that's how it should be viewed. £500 is 0.25% of sale price of £200k, that's a very low overhead, especially given high increase in house value. It's like what, you buy a car for £10k, and insurance costs £500 (every year), which is a much bigger ratio of the sale (and value depreciates), so why not everyone object to insurance costs??!

[TimberWolf]

Incidentally, my comments relate to a (previously stated) premise that we may be entering a difficult period in the housing market, i.e. that houses put onto the market will not sell. If this was already appreciated, then I’ve no idea what your beef is with house sellers, which may even be valid (in some far away universe).

[AtW]

I’ve no idea what your beef is with house sellers, which may even be valid (in some far away universe).

My beer is this: if you have got asset worth £200k (or likely more, especially in London), with great increases in its value over short time, then whining about £500 cost of sale is ridiculous.

[TimberWolf]

If you put your house for "sale" just in case someone offers ridiculous price then it's not a sale - it's a gamble, it should not happen - it's like putting shares on sale with asking prices way higher than you can reasonably expect to sell them for - this sort of activity should not be free. Otherwise market get skewed.

Perhaps why it’s called a housing market, rather than say a housing shop.

It's a cost of sale and that's how it should be viewed. £500 is 0.25% of sale price of £200k, that's a very low overhead, especially given high increase in house value. It's like what, you buy a car for £10k, and insurance costs £500 (every year), which is a much bigger ratio of the sale (and value depreciates), so why not everyone object to insurance costs??!

It’s only a cost of the sale if you manage to sell, otherwise it’s just a cost. This is essentially the crux of the (my) argument.

[TimberWolf]

My beer is this: if you have got asset worth £200k (or likely more, especially in London), with great increases in its value over short time, then whining about £500 cost of sale is ridiculous.

In todays market paying for a HIP may be more of a gamble for some than a cost. Sitting sight for a while and waiting may be preferably, we don't know.