Cambon Posted March 21, 2007 Share Posted March 21, 2007 And if no buyer can afford it, the price drops. Price is set by the buyers. Actually, it will usually stay on the market until someone comes along and pays the price. The only thing that will force a price fall is excess supply which push the buyers back in control (as per my early '90s example earlier in the thread). Realistically, how often do you see "Price Reduced" on a property? Not often, and usually it is only to attract attention, it is not a genuine reduction. Link to comment Share on other sites More sharing options...
Slim Posted March 21, 2007 Share Posted March 21, 2007 Realistically, how often do you see "Price Reduced" on a property? Not often, and usually it is only to attract attention, it is not a genuine reduction. All the time. Often they're not advertised as 'price reduced', they're just quietly re-listed by the agent. Link to comment Share on other sites More sharing options...
BigDave Posted March 21, 2007 Share Posted March 21, 2007 The trouble on the island is you have 2 or 3 large developers who are having regular meetings together to keep the prices highI can say with 100% certainty that you are very very wrong! They don't need to conspire to fix prices, they just do what business does best - charge the most they can get away with. Do buyer's dictate the price? No. The market does, lead by the sellers. If you cannot afford it, someone else will. Nearly there. If you cannot afford it, another buyer will come in and buy it - thus setting the price. In a rising market, it is still the buyers who are setting the market price. They are doing this by their willingness and ability to pay more to secure their purchase. It is not the desire of the vendor to obtain a better price that sets the market price. What we all see is vendors demanding more, which if you look at it does indeed appear as if sellers pushing prices up, but the simple and undeniable fact is this - buyers are only willing to pay more because they are in competition with other buyers, not because some estate agent says a house is worth x amount - they want the house and don't want someone else to get it. It is the buyers with the power, and competition between buyers that pushes prices up, not vendors. Link to comment Share on other sites More sharing options...
BigDave Posted March 21, 2007 Share Posted March 21, 2007 Funny how the house cost almost £55K over what they could afford without the grant and top up. DoLGE fix the prices on the approved dwellings - well below the price at which open market properties are selling. How is that funny? Link to comment Share on other sites More sharing options...
Cambon Posted March 21, 2007 Share Posted March 21, 2007 Funny how the house cost almost £55K over what they could afford without the grant and top up. DoLGE fix the prices on the approved dwellings - well below the price at which open market properties are selling. How is that funny? By funny I meant strange, hardly coinsidental. The Government may have some influence over the price, I don't know. The specific property that the people bought was on the open market as all the Ballawattleworth properties were. The £55K was applied for and granted fairly quickly. The only restrictions are that if they sell the property within 5 years they have to repay the grant in total, unless they sell it to the government where the money will be taken into account. After 5 years they are free to sell but must buy another property on the island or repay the grant. In other words after 5 years they cannot sell up and leave the island. I do not know how long that entailment lasts for. On your price rises post, technically you are correct, and that is the way it works in Scotland regardless of it being a sellers market everywhere else. In Scotland properties are advertised as "Offers over £nnnnn". It is then up to the buyers to compete on price. However, the start figure has to be realistically low. Out of time. need to go. otherwise Iwould continue Link to comment Share on other sites More sharing options...
Slim Posted March 21, 2007 Share Posted March 21, 2007 Out of time. need to go. otherwise Iwould continue talking shite Link to comment Share on other sites More sharing options...
Cambon Posted March 21, 2007 Share Posted March 21, 2007 Out of time. need to go. otherwise Iwould continue correcting Slims shite That is better. Link to comment Share on other sites More sharing options...
BigDave Posted March 21, 2007 Share Posted March 21, 2007 The specific property that the people bought was on the open market as all the Ballawattleworth properties wereIf they got a top up loan, it was not open market. Top ups are only permitted on government controlled (DoLGE) first time buyer homes (called Approved Dwellings for the purposes of the HPAS 2002/2004). I would be surprised if all of the Ballawattleworth development was open market, as there has been a planning policy in place for quite some time to require any development over a certain number of homes to set aside 25% of the development as first time buyer homes for sale under the HPAS as approved dwellings. The Government may have some influence over the price, I don't know If the couple you know who bought a starter home with a grant and top up, then the property they bought was an approved dwelling. This is built by a developer on behalf of DoLGE, and sold at a price set by the department to a person nominated by the department, so yes, with these properties, the government has more than influence, they have 100% control! The fact that the house was 55k over what they could afford is by design. Those who can afford the least will get the most assistance, however those who can afford more, but still need assistance might only get 25k in grant and top up for example. You see it's not coincidental - it's intentional! (With the approved dwellings only obvoiusly) As for open market properties, the most you can get is 25k and that is means tested and set on a sliding scale. Not everyone gets 25k and those that do get the full grant of 25k usually cannot afford the open market properties with just a mortgage and grant - hence why I said earlier that grants for the open market are a token gesture with only few being able to take advantage. I think I'd be fairly safe to say that the HPAS does not influence open market prices to any real degree. Link to comment Share on other sites More sharing options...
rallybug Posted March 21, 2007 Share Posted March 21, 2007 As for open market properties, the most you can get is 25k and that is means tested and set on a sliding scale. Not everyone gets 25k and those that do get the full grant of 25k usually cannot afford the open market properties with just a mortgage and grant - hence why I said earlier that grants for the open market are a token gesture with only few being able to take advantage. I'd go along with that - the combination of my gross salary multiplied by the mortgage lenders, plus the maximum grant I was allowed on that salary (not the maximum available) meant I was just short of the purchase price of the flat - with some judicious tweaking of the mortgage multiplier I reached the price (slightly larger mortgage than was originally offered), else I would've had to take the top-up loan. It didn't help in my case that the grant was worked out on the 2002 amounts as planning permission was granted in 2001 - never mind that we didn't get to move in until this time last year! If the goverment had used the 2004 grant amounts, I wouldn't have needed to juggle with the mortgage lender, as that extra £3000 would've been provided in the grant. Still think that it is better than nothing - my brother, at age 38, can't afford to buy a property in our home town in Somerset. Link to comment Share on other sites More sharing options...
Slim Posted March 21, 2007 Share Posted March 21, 2007 Still think that it is better than nothing - my brother, at age 38, can't afford to buy a property in our home town in Somerset. Do the estate agents and developers there attend secret price fixing cartel meetings in the dead of the night there too? Link to comment Share on other sites More sharing options...
Bombay Bad Boy Posted March 21, 2007 Share Posted March 21, 2007 Do the estate agents and developers there attend secret price fixing cartel meetings in the dead of the night there too? Some properties sell quickly, some seem to stay unsold for ages. Its as though the vendor has been told what price to ask, and then holds out for that, even if it takes months, even if offers are within a few %. Link to comment Share on other sites More sharing options...
modey Posted March 21, 2007 Share Posted March 21, 2007 The goverment gave us a grant towards buying a first time buyers house but it wasn't explained to us at the time that if we EVER want to sell it on the goverment will able to claim 30% of the fee we sell it on for. We got a grant of £13,000 and at current market value, if we sold it on we would have to give the goverment back £48,000. Not a bad few years work for the goverment. This being the case we will never be able to move up the ladder. The first time buyers scheme was actually changed after this cock up but it doesn't really help the people who live on this particular esate. Link to comment Share on other sites More sharing options...
Roger Smelly Posted March 21, 2007 Share Posted March 21, 2007 Well the sad thing with the whole grant scheme is the money is written off after 5 years ? Why is it the people don't pay it back ? The £25.000 should be like a bond that goes to the next person who needs a foot up to get on the ladder. I agree with the grants but i would like to see them payed back. Otherwise its just good money after bad. Most will agree that owning a home is a sacrifice not an inconvenience. Link to comment Share on other sites More sharing options...
Slim Posted March 22, 2007 Share Posted March 22, 2007 I agree with the grants but i would like to see them payed back. Then it'd be a loan, not a grant. Link to comment Share on other sites More sharing options...
rallybug Posted March 22, 2007 Share Posted March 22, 2007 Do the estate agents and developers there attend secret price fixing cartel meetings in the dead of the night there too? Nah, it's just Londoners moving down with excess notes in their back pockets - they want a place in the country, so will make sure they buy it, therefore presumably paying asking price or more for their 'perfect' country place. This has then brought all property values up. A 2-bed Victorian mid-terrace with no garage or parking, but admittedly a good rear garden has sold STC for £149,950 - when I left 10 years ago, they were going for about £40,000. Link to comment Share on other sites More sharing options...
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