Too few homes and too high prices, say buyers

A survey just conducted on behalf of Rightmove says the two biggest problems facing prospective buyers are the sheer cost of homes on sale, and the fact that there are too few of them on the market in the build up to the May 7 election. 
The survey of 1,418 people, conducted earlier this month, shows that the biggest concern among house buyers is that house prices are way too high (38 per cent), with the lack of choice of properties for sale on the market coming second at (17 per cent).

The reason is house prices in the UK are out of line with reality. What needs to be worked out is how to re-align them properly and permanently. What follows explains, in detail, what owners and agents need to do to ascertain the current value of a particular house that they may be interested in selling or indeed buying if it’s for another owner.

Before we go into what you need to know to carry out your own valuation or assessment more competently, lets look at how it’s generally done by agents at present.
For a good while now, houses have been valued primarily by selling agents using what we would describe as giving their clients their best ‘GUESTimates’ of what houses might be likely to fetch in the market currently.
The effect of this is to make the market work in a more haphazard way, with rules of thumb being applied to the various types and sizes of houses to be sold, rather than the seller obtaining more in-depth research, not only concerning the house to be sold and its condition, but also the potential price that could be obtained taking other valuation aspects into account such as the availability of mortgage finance in the current and foreseeable future market and interest rate trends.
Among the problems the present defective approach throws up are:-
1. On the plus side failure to notice hidden value potential in properties that would benefit from wholesale development/improvement (resulting in the seller loosing out on the price attainable).
2. On the negative side failure to understand the need for more extensive repairs concerning a property to be sold (resulting in the buyer being expected to pay more than they ought to, bearing in mind the work needing to be done at the property).
A significant effect of all this is that the houses that have hidden but realisable potential tend to sell more quickly but the ones with little potential as well as more costly essential repair or improvement works required, tend to stick on the market. These sales are the ones that tend to have serial reductions in their asking price, ultimately resulting in them being sold or withdrawn from sale.
In these situations a buyer can make an error, in buying a house or flat where both they (and very likely the selling agent) are unaware of the extent and cost of the repairs needed to make the property comfortable to live in.
Alternatively, the buyer could successfully find themselves one of the houses that does have considerably more potential to be exploited than was initially thought, for example where extending or building a second new house on the same site would be both feasible and cost advantageous.

The problem with the current market is that there are too many houses being advertised at over optimistic ‘asking’ prices which have significant negative attributes like extensive repairs and re-modelling. Agents seem oblivious to this problem yet it simply cannot be ‘wished away’ in the headlong rush to improve the flow of their sales pipelines!

So, before we explain the way in which house valuation may be carried out accurately and comprehensively we wanted to draw attention to the fact that currently, most asking prices are really derived from the tone of values being manufactured by the selling agents’ unwritten rules of thumb, when walking around and giving their general opinions of what house prices currently are - in the specific area in question.

Instead, what needs to happen is for agents to act more even-handedly between buyers and sellers in the market and to offer more appropriate advice which either side of the bargain might find illuminating.
We have a solution for accomplishing this. It’s called The Hendry Solution.
To read more about it please go to:

Earlier article on our blog site: Full details of our proposals for properly reforming the UK housing market.

One of the recent failures has been that no one government has addressed the problems regarding the way houses are bought and sold and sadly, the market stagnation which has resulted will continue to result if nothing is done.

If they had done something earlier it would be one less issue which they now have to deal with. Unfortunately, as is clear to all, that would have come as a welcome relief.

Unless the next government can re-organise the way in which the UK/English housing market functions, there will be continued mayhem for many years to come, with prices cycling wildly upwards and downwards to the dismay of both buyers and sellers in this, all too crucial, marketplace - and driver of our nation’s economy.

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