A large 4-bedroom house on Lewis has finally sold, after being on the market with Anderson Macarthur in Stornoway for 2 years, advertised at £150K and then at £135K. These prices were considered "realistic", and based on a professional "valuation" of £140K.
It has just sold for £99K.
Not privately but at auction, knocked down to the party willing to offer the highest price for it. Nobody was willing to pay any more.
Source:
formatting link
September08.pdf
Doubtless the owners were unhappy, but in the end they recognised market realities and eventually got some money for their house.
A large proportion of properties advertised in Lewis and Harris (and also a few other places in Scotland) have been on the market for 1-2 years at prices that obviously nobody is willing to pay.
The only houses that will sell will be those where people take price cuts of 30, 40, or 50 percent.
Many will take their houses off the market. A few will stubbornly persist that "they know how much their house is worth", going by the top-of-the-head opinion of some ruler-wielding surveyor a couple of years ago.
I think we are about to witness a large fall in the price level of houses that actually sell, though.
150K and then at 135K. These prices were considered "realistic", and based on a professional "valuation" of 140K.
It has just sold for 99K.
Not privately but at auction, knocked down to the party willing to offer the highest price for it. Nobody was willing to pay any more.
Source:
formatting link
September08.pdf
Doubtless the owners were unhappy, but in the end they recognised market realities and eventually got some money for their house.
A large proportion of properties advertised in Lewis and Harris (and also a few other places in Scotland) have been on the market for 1-2 years at prices that obviously nobody is willing to pay.
The only houses that will sell will be those where people take price cuts of 30, 40, or 50 percent.
ISTR the Highlands and Islands were the focus of a big initiative in the dot.com era to provide homeworking jobs. Given the exporting of software, web designing, and call centre jobs to India etc, all in all I don't suppose that worked out real well.
Travelling in the UK is disproportionately expensive The H & I is a remote destination for most of the UK and Swainbost is about as remote as it gets, so I don't suppose tourism is doing that well either.
It's not clear how the money is going to come in to support houses in the £150k - £250k bracket. Maybe eventually the houses will still fetch £150k but each of the pounds will be worth less. That seems to be the governments favoured alternative
It's a pity, but a lot of cities in the UK face the same future having been riding on a bubble for about 10 years now.
Fully agreed, it's not representative of elsewhere, except maybe other similarly remote places in the UK, e.g. Shetland, but I don't know much about them!
True. On Lewis, there were just a couple of scams with a dozen or so "jobs" and big grants to the "Enterprise" etc. Nothing real. Tell the local movers and shakers about anything from the internet to climate change to "changing the energy mix", and they'll be able to scam some money out of it one way or the other, and get a few stories in the newspapers too. Practically all of the money in the local economy is public-sector grant money, whether you are talking about big employers such as the council and the hospital or sectors such as building or information technology.
There has never been any tourism to Lewis to speak of. A few people get off the ferry each day in June, July and August (and if it's August and the midges are out, they probably don't come back!), some hippies at midsummer (the best of luck to them!), that's about it.
(I'm not sure who mentioned Swainbost!)
And still there's the loony message between the lines of so many news reports, suggesting that everyone's prosperity depends on soaring house prices. The truth is that an average house costing about £200K could be built for about £60K. Less, now that Polish building workers have underpriced British ones. In fact, considerably less if people were OK, with, say, wooden walls and metal roofs, which are perfectly OK but public relations for "the industry" (the construction/bank alliance) has swamped them out.
High house prices are a result of
a) HIGH DEMAND, via a successful and huge drive by the banks for decades, peaking in the past few years, to get as many people as possible as deeply into debt as possible (that was the reason, for example, for replacing mass youth unemployment with the expansion of higher pseudo-"education" - most people who go to "uni" nowadays learn little other than how to chuck their money away), and
b) RESTRICTED SUPPLY, by means of laws on "planning permission". This didn't exist prior to 1918. Around that time, some bright spark had the idea of buying some land outside Brighton, at a place that came to be called Peacehaven, and chopping it up into small bits to be given away as prizes in a competition, to working class people. Then if they wanted, they could get a house built on their patch, for cheap. This was the beginning of working class house ownership in the UK. The rich went absolutely livid, and introduced "planning permission" laws in response.
Then 4 decades later mortgages really took off, not (as had previously been the case) as a state into which a landed estate could fall when the owner had gambled himself into mega-debt, but as a way to make sure the proles didn't get ideas above their station.
Then in the nineties and noughties, when prole power of any kind was a thing of the past, the banks made it "normal" to get into big debt at the age of 18 (the youngest a person can legally do so), and stay in debt for the next 40 years of their lives.
It's an absolutely dreadful, appalling situation, and recognising the above doesn't even suggest a way out. Understandably, people don't want to be tenants in the private rented sector if they can help it. But I'm afraid that a lot of people are going to realise, within the next few years, that no, the government and the bankers don't have any care for their interests whatsoever.
And the above applies to even greater extent in Ireland, where to quote a recent report, Scandinavian levels of expenditure coincide with Mediterranean levels of productivity. I.e WATCH OUT!
I think that was me, the one property ?Taigh Calum?, on the Ken Macdonalds website with a vaguely attractive price at the low end (£60k for a 3 bed detached house) was located there, there are more in the 5 & 6 bed category but they probably won't sell unless divided into multi occupation, that's what has happened in the cities down south, but there's a lot of cost in doing that. Fine if the local town has 5 or 6 so-called "universities" (formed from the technical colleges, colleges of FE, teachers training colleges of all religous flavours etc.and the Uni proper).
The message from Derek Geldard contains these words:
In the 1970s I was going to buy the improvements on a seven acre croft for 400. This included a 2-up, 2-down house with a large almost-room-sized cupboard on each floor.
True, one was in danger of falling through these...
And a stone-built barn, ditto byre, and a weaving-shed abutting the north-east gable-end, fencing, access to common grazing, mini-harbour beside the croft, and a 'well'.
Due to circumstances beyond the control of the vendor he had to continue living there.
of "normal" houses or of luxury city centre flats?
I'm looking to see one of these "inappropriate" properties this week. Locally, there's an island of high quality apartments surrounded (on all 4 sides) by a sink estate. They sold new 18 months ago for 149 (less than comparable flats in better areas). One of them has been up for rent for 6 months with no takers and was put on sale by the owner at 132. It's now been repo-ed and the BS is selling at a guide of 99.
I was thinking of offering 70, but one of my colleagues said "you don't want to live immediately next to that estate however cheap it is" I will probably go along to see if I can get any useful info out of the EA about the market.
TBH this apartment doesn't suit the BTL market, at any price. It is far too nice to be let to the sort of person who's prepared to live in the area. There are another 200 people who bought into this estate who are going to get a shock in the near future.
I am sure that there are lots of other examples of large falls on properties that were inappropriately sold, this doesn't prove anything about the rest of the market IMHO.
Have you confirmed that the 'owner' actually paid 149 for it? (Not that it would be surprising if they did. Many debtors don't realise that surveyors work for banks in more ways than one).
In several areas I've heard of, the properties that are selling at say
30-40% lower than recent asking prices are being sold by banks. Just as it's the banks who made prices rise by creating demand through debt, it's the banks who are making them fall by actually meeting the market rather than waiting around indefinitely, claiming 'we know how much it's worth', waiting for Father Christmas. I'm beginning to think auctions of repo'ed stock are about the only sensible place to buy properties at the moment.
Have you confirmed that the 'owner' actually paid 149 for it? (Not that it would be surprising if they did. Many debtors don't realise that surveyors work for banks in more ways than one).
Some people do inflate prices when completing the SDLT1 - mainly in respect of deposits gifted by builders, but also for other (more clearly unlawful) reasons.
BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here.
All logos and trade names are the property of their respective owners.