harold bishop

Well, in the case of my friend buying with sealed bids, the very real fear is the vendor pulls out and re-lists at a higher price. For the houses that are sticking, the vendors just sit tight or rent them out and go into rented themselves. Unless interest rates rise, there will be little fear of defaulting on mortgage payments. Even mortgage holders losing their jobs is not an immediate issue as the government pays the interest. As I see it, very large parts of the market are stagnant and there is a small part that is pretty active and pretty much operating in a different orbit.

A friend has just won a sealed bid on a nice house in a N Oxfordshire village. Several bidders, all cash. All at or above asking. House listed 10 days ago. Definite two tier market. Most places that are normally bought with a mortgage are sticking and dropping. Anything decent sells for cash and goes in a blink at or above asking. Straight from the horses mouth.

Of course, but most vendors just accept what the EAs ask for, which is around 2 or 2.5% + VAT at 20% - so getting on for 3%. By the way, they also charge for glossy brochures and additional "Country Life" type magazine adverts. I can't see how this is any better than a good web advert. My biggest gripe with Rightmove is the adverts only have 5 - 7 pictures. How hard is it to take, edit and upload 40 relevant pictures ? A school child can do it on Facebook but an EA can't be bothered on a half million £ house.

I sold in Oct last year but used an EA at 1.25 % incl VAT. But I wasn't around to do the viewings - would definitely have done it myself otherwise. I did all the tricky stuff as the house was very old and it had lots of weird stuff in the deeds. But I explained to the EA I would do that for them. They were very good, a small independent with two partners and a switched on office girl. Dead easy to deal with as there was complete transparency and direct communication with the buyer. So, it can be done if the EAs switches to Human Mode and disables EA Mode. I think Ebay is probably the best place for private house sales. If they copied Rightmove's search and refine facility, it could work well. Not sure house much they charge though.

A bunch of highish-end detached new builds ( £550k - £650k) have been released near me in Oxfordshire. All are now "Reserved" a week after release and opening of the show home. I can only think some people love brand new houses. Similar "used" houses, with more garden, more parking, less crowded and in very good nick are cheaper ( and probably all the snagging & teething sorted). What's that about ????. I asked the EA what "Reserved" meant. She said the "reservation fee had been paid by proceed-able clients". Presume a client is a buyer and a reservation fee is a token amount and not a 20% deposit. Anyhow, not a house ( finished, half built or just a plot) is left. Wadda I know ??

Way back in 1995, when housing was in a slump, I sold my house privately. When you do a private add, I believe you can ignore all the rules and regs that EAs are subject to and say stuff like "lovely family home, kids enjoyed the tree house, great veg plot etc". I took a nice picture and put an advert in the local paper on their property day. Sold to the first viewer. I got three EAs to do a valuation beforehand. As soon as I agreed with the buyer, we let the solicitors do the rest. All very pleasant and it makes one wonder why anyone would use an EA if they were on hand to meet the buyers. There is no selling involved - either the house suits a buyer or not. I believe vendors are mostly worried about doing viewings to strangers and this will put off a lot of private sales. And I'm sure EAs will play on this. Also, EAs will make out they can use their negotiation skills to get a better price, hence covering their fee. There is something in this if you have been on the lying buying end of dealing with an EA. Also, in the great scheme of things, paying 1% or 1.25% incl VAT to sell your house isn't a deal breaker for most people. I was involved in the yacht brokerage business for many years. Typical commission is 6 - 8% !! But a web site called - believe it or not - Apollo Duck popped up, and allowed free private boat ads, with masses of pictures and information. I'm not in that business anymore..... But if people can sell £100k yachts privately, then they can sell houses. The difference is just the commission rate. the EA rate is low enough for people not to bother going it alone.

Still one of my favorite charts ! I reckon we're well below the 200 oz level in terms of Sterling priced gold. Heading in the right direction with today's house price news and gold's recent run up.

I think that's what used to be called a Jewish Stock Take or Jewish Lightening in the East End of London. Perhaps its now house builder's lightening.

Yep, I think that's the way forward. Thanks

Thanks for that Romans. Interesting advice. I suppose one set of fundamentals may be a typical family with two young kids, one full time earner and one part time. So, 1.5 x say £30 k per year = £45k pa household salary. x 4 for a mortgage = £180k. Say a loan to value of 80% gives a buying price of £225,000. This is workable at current interest rates but if mortgage rates hit 8% then this family would be in real trouble. Umm, so, a £230k offer from my in-laws would be pretty good. Food for thought.

Agreed. But a great majority of people who move house do so because there are reasons other than financial. Schools, elderly down sizing, jobs, divorce, etc etc. Not all these movers want to go into rented, particularly elderly, as they rent as a waste of money. My partner's parents have got the bug to move somewhere with less maintenance and with decent public transport, nearby shop/s and health clinics. They just want to get on with it. House prices going up and down is neither here nor there for them. There is no mortgage involved and they'll buy for what they sell for - or thereabouts. I'm trying to gently educate them a little on the housing market as these people are just canon fodder for estate agents. So, they've seen a suitable house which started out at £275K in July, its now £270k and a very similar house sold for £246k in May 2008. The agents have had no offers. Below £250k the stamp duty drops from 3% to 1%, so, clearly this house won't sell above £250K. Bearing in mind I've hauled them back a bit and this isn't the "one and only" house for them, what suggestions ( realistic advice) would any property watchers be prepared to offer ? For what its worth, I've told them if the agent calls them, to say they are considering an offer in the £230 - £235K area and they are happy to keep looking. So, instead of waiting months and months for a 20% drop, why not try and get an immediate 12 - 15% drop ?

Thanks for the update Goldfinger. Moving strongly in the right direction. I always find the Gold ratio charts useful - a constant in the sea of variables.

Being a "buy bullion coins and stash" person ( ie. put them aside for my kids out of prying eyes), I was just wondering how the UK house price vs Ounce of Gold ratio was going. GF has been up to speed on this before ( very grateful). I'm not much of a chartist as I'm busy trying to earn a crust in Turdling ( most grateful to GF for this technical term). Its wierd when you start looking at the price of things in gold, especially the shopping trolley at the Tesco check out. I'm always tempted to ask for a couple of Sovereigns as "cash back".

Ha ! Interesting language. To think we were being fed the "demand out strips supply" message.... How things quickly invert. If Hp/Gp = 360 now, then, if my sums are correct, a 50% drop in house prices and a 50% increase in the gold price would put the ratio at 120. Throw in an overshoot and we could see 100 or sub 100.

Umm, not sure about 10 oz or 50 oz - but it would be nice New house prices are made up of materials, labour, land and greed. If we discount the greed, the reductions must be spread over the other three parts. Building materials increased 8% in the last year (RICS). So, labour and land has to plummet. Labour prices will & are getting hit but in the end brickies will not work for nothing. So, building land values have to take the major hit. We'll see this when the big developers start shedding the "land banks". I don't see this happening yet as I believe we are still at the beginning. There is lots more pain to come. The house gold ratio is a good one. Where are we at the moment ?

'cause oil is just too cheap

That was a very bullish report and the investors will like that. I suspect we will start to see a rash of small, closed-downs mines "re-opening". Even with high metal prices, it is often very difficult to start producing again. In the UK, mines are often: flooded, need new machinery, need to meet very stringent H & S requirements, cannot economically meet environmental obligations, in particular pumping out, treating and disposal of the mine water. Tin is riding high yet the Cornish tin mines have not swung into action. Production of base and precious metals continues in low cost regions which pay scant attention to the above issues, yet they achieve the same market price. Still, I think stories like this are bullish for gold.

Umm... This should mean the ECB will raise rates. Thrichet has already suggested ECB rates will go up. Will the BoE and FED follow ? Will they all raise together ? I think the ECB will raise and tell Spain and Ireland to get stuffed. This is punishment for Ireland for voting against the Lisbon Treaty. It will make Europe a very expensive place to visit for Brits and Americans. In fact, it aleady is.

Iran will be the target. But only the nuclear facilities. Russia have deliberately ( anti USA) provided Iran with missile defence systems, so, the task won't easy. Israel took out the Iraqi and Syrian nuclear bases and I'm certain they'll go after the Iranian. Remember, they have been very quiet during these Gulf wars and I think they'll show their hand soon - with the blessing of the USA. Iran has become too strong now their old enemy, Iraq, have been quashed by the USA. Its a dangerous situation and rarely commented on. If it explodes, oil and gold will rocket and the UK will face the same situation as the 1970s.

They'll be comforting themselves that oil / gold etc are just speculation driven and there are no fundamentals supporting the prices and things will turn their way soon.

Thats been a great golden end to the working week. About time. I'm also quite heavy in Euros and they've done well on Thrichet's (hollow) threat of raising ECB rates. I still think the Euro is a bit "iffy" and I'm very indecisive of swapping to another currency. I'm sticking with the Euros for now as I sense a shift of power to the EU from the USA. Soros touched on it briefly in his "Age of Fallability" book. The USA ( read Bush) has blown its world sympathy after 9/11. Sorry, a bit off thread.

I'm just an amatuer gold bug with some coins and one of the reasons I hold a percentage of my money in gold is because of the above statement. I'm sure cowry shells have been used for centuries as well but I wouldn't swap !

Ooh ! Good thread. I'm an engineer and successfully hide my arty interests under a philistine bushel. Of course, thankfully, this allows me to never understand some of the high priced art out there. I occasionally buy originals and often several of the same artist, so, I'll have a mini collection. I'm currently liking Rosie Scott, have bought a few and will buy some more. I just like them and like the gold coins, I hope I'll never have to sell but pass them on outside of any government claws. What about other art, such as objects, vases etc. Lovely to have around but some of the antique Moorecroft pottery I bought in the late 80's is barely worth any more now - despite high expectations. Got to be careful or we'll end up like the BBC's Antiques Roadshow. edit. spelling

The Romans put silver in their drinking water storage tanks for the same reason. Some domestic water filters are silver impregnated activated carbon. silver nano technology is the next step. Could be interesting. You may paint the hospital walls with the stuff but you still have to get the doctors to wash their hands.