Buying a house in East Dulwich? expect sealed bids!

[Pendragon]

Hi all

Ok....Either Im not living in the real world, or everyone in East Dulwich is mad!!!(in a nice way obviously)

Im trying to buy in the area...Ive seen 3 places and all of them are "apparently" going to sealed bids!!? Ummm..... didnt we just have the worst recession ever? or have I timewarped back to 2007 crazy days?

I understand the seller will want as much money as possible and get their "greed" switch turned on by the agent who no doubt promises them sealed bids if they stand firm, but surely buyers can see this is a very unscrupulous and obvious method by agents to get people to bid up and probably pay something stupid way over the asking price (probably with no competition at all!?!!)

I absolutely will not enter into sealed bids due to knowing this, but Im just thinking if everyone tells them to p-off then we all stand a much better chance and at lower prices

Yes im (obviously)frustrated by this each time but also keen to know is this par for the course round here?

If not- stop panicking people and dont believe the hype- the agents are probably laughing at us!

To be fair, I know that houses are only worth what people will pay for them so if buyers are going to sealed bids does this mean this is a reflection then that the recession is dead and everyone is ready to pay silly money again?...If so I dread to think what it will be like if the market actually recovers....am I alone on this one?!...

Kay x

[ratty]

It's still a very des res area, and there is always someone who will pay or go over the asking price if they want the property. There is so little to buy in ED currently that prices are pretty much back to pre recession levels for what is on the market.

[R&A]

As long as interest rates remain low many people will be in 'recession-denial'

In fact a lot of people feel richer as long as they are on variable mortgages and have stayed in employment

This has helped house prices (and the lack of stock)

A house near us had 8 viewings on a saturday morning and sold in a day... i can believe the sealed bids thing. It's madness but it's happening for sure.

[DrinkingBuddy]

I'm missing your point. In many countries this is the only legal bidding process and prevents buyers from having the pressure of continually increasing bids putting pressure on them to increase theirs. I for one would actually prefer a legally binding blind bid be th only allowed process, where by the accepted bid has to go through to closure.

As someone who was gazzumpee during open bids all the way up to exchange day on one particular property I would be appreciative of this kind of guarantee.

[legalbeagle]

I'd second that. Prices have dropped round here, but the result has been very little is being put on the market in the first place. No one wants to take a lower price unless they have to so no one is moving unless they have to. Which means that when something nice does come on the market, everyone wants to buy it! I've noticed this happening in a number of "des res" areas in London (anecdotal evidence of various friends trying to buy, that is).

[karter]

hey kay,

prices in ED have dropped to more realistic levels whereas before they really were hyped up by the agents. Property around here is not 'cheap' though. I would make the offer of what you are prepared to pay then walk away and see what happens. Don't let it get to you. It is always a stressful game otherwise. :)

[ruffers]

Seems if anything better than agents effectively running an auction, more honest if anything as long as it's done right.

As they say, if you don't want to get involved then don't.

As you say houses are worth what people will pay - bid what you think it's worth then job done.

[Jeremy]

Actually, I think prices are almost back to pre-recession levels. Still hard to get a decent 3-bed house for under 500k, and there seem to be plenty of buyers around. I'm really surprised at how quickly the market has sprung back.

[????]

dead cat bounce

[ratty]

???? Wrote:

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> dead cat bounce

never heard that expression, what does it mean??

[SteveT]

Sealed bids are always suspicious I know they are prevalent in Scotland but I would avoid them like a plague.

I always felt that they are too easy to fiddle, if someone on the inside was so mindful.

So I second Pendragon's view.

R&A wrote:- A house near us had 8 viewings on a saturday morning and sold in a day.

In that case it was probably sold too cheaply, and the seller may have been unwittingly stitched up at the original pricing of the property.

Generally you need a dozen potentials to go through the place before you get a reasonable bid by a serious buyer. If that was my place I would drag it off the market and get it revalued by another estate agent.

[R&A]

Possibly -

Three bed house (small), north facing garden near ED train station

In ok condition - perhaps in need of a little tlc

?460k...

[edf]

"Dead cat bounce is a Wall Street term that refers to a small, brief recovery in the price of a declining stock."

??? is stating that prices will continue to fall very soon.

I think this will happen as soon as the Bank of England base rate is raised. However it is possible with a weak government to deliberately cause high inflation, therefore salaries raise and then house prices can stay stable. However high inflation is extremely bad for other reasons, for example making morgages very expensive.

[SteveT]

Quantative Easement helps to fund inflation and devalue the pound in your pocket too.

Remember 'stagflation'.

[ruffers]

Imagine a dead cat falling off a building. It will bounce, doesn't mean it will continue to go up. It has found it's level.

[R&A]

High inflation would force the BoE to increase rates but according to Benanke yesterday, that's not going to happen anytime soon (in the US at least but we tend to follow their lead...)

In fact inflation is good for home owners as their debt (mortgage) diminishes and the asset price inflates

Dead cat bounces tend not to have any fundamental drivers of price i.e. the price just rises as people try to bag a bargin. However there are drivers of this house price move a) the weak pound b) low interest rates and c) short supply

If any of those three fundamental factors changes (pretty likely) then prices will fall again.

[sazzle]

I bought a few years ago and made offers on about 3 properties and all of them were blind bids.

It might seem harsh but it does also avoid going back and forth and trying to outbid someone else.

Like Karter said - make an offer that you are happy with and then see what happens.

If you really want to buy round here then you just have to accept that's the way it is, difficult though it may seem.

[Rook]

I would say be careful with sealed bids.

Agents will definately imply there are other bidders in order to get you to go higher, when this might not actually be the case at all. For this reason sealed bids are very open to manipulation with no way of knowing the exact situation

I dont agree with some of the other posts that they are fair- they are not legally binding and youll probably find that the seller (in a state of intense greed by now) will still be open to further counter offers anyway!

I think they simply tap into buyers paranoia- and force panic offers. One thing is for sure....youll end up probably paying alot more than the place is worth so youll have to be sure you truly want it and will make the money back.

I am in agreement that house prices will drop very soon- for that additional reason I would definately avoid like the plague at the moment ...but theres nowt as queer as folk!

Best of luck searching. In additional to the general economy its also just a question of supply...other places will come on soon, eradicating the need for sealed bids and will drive prices lower too. Waiting 6 months is better than sitting in negative equity! Other nice houses will appear!- good luck

[onlyk]

having recently brought a house in the area if you're looking for a house under 500k then there's alot of competition. In the last year I've been gazumped, outbid, outbid on sealed bids, booked an appointment to see house which on came on the market at 6pm on Friday by 1pm saturday my appointment was cancelled because an offer had been accepted..... I could go on.

The upside the house market two years ago was much higher than it is now but if you're looking for a 'bargain' now you may have missed the boat as the lack of stock in this very specific area are keeping the prices up.

Sara at Harrts was great only show us houses in our price bracket & criteria. Actually got the last house she showed us, phoned me Thursday afternoon new instruction, looked round Friday 1pm, offer accepted Tuesday. Have to say after all the above hassle was surprised it only took 5 weeks to complete!

Good luck.

[jim_the_chin]

Prices haven't dropped at all - we sold then came off the market as everything above us went ballistic. We viewed a house at ?550k and were told the owners would accept a much lower offer; it's just come back on the market a couple of months later at ?600k.

The agents are kiling any movement in the market by over-pricing to get people on the books. You'll be paying top banana if you buy now with the strong possibility of the dead cat splat.

[????]

Loads of money floating about becuase of QE and historically low interest rates

Lack of supply

Buying houses looks ok looking at a payment of say 3.5% interest for a mortgage(if you can get the deposit or trade up etc)

For 'investors' nowhere to put their money really.

= PRICES UP

Coming soon - tax raises, increased unemployment, continued underemployment, decrease in public spending, likely run on pound and resulting increase in inflation (we import practically everything) but not enough to really inflate away big debts (like mortgages), subsequent increase in interest rates and people just forget how low they are if base rate goes even to about 4.5% we'll start seeing significant repossessions. Prices fall. The markets still overpriced and the current rise is a classic dead cat bounce (I'd say the same for the stock market too). All my opinion obviously.

BTW, inflation is mainly bad because of what it does to savers and those on fixed incomes such as many occupational pension holders.

[Pendragon]

Wow thanks all, some interesting comments!

Just to be clear, Ive got nothing against sealed bids as an actual initial method if someone chooses to sell that way, but Im talking about agents saying its all going to sealed bids above the asking price!!

I dont think everyone thinks "ooh its definately worth more than the list price Ill offer that". Therefore, I think instead its agents creating that and people falling for it, unwittingly bumping up offers above and beyond the asking price through fear and a bit of panic as they get played a bit

Hey ho anyway Im just frustrated thats all- good luck if they want to offer it I suppose....heres to the dead cat bounce!!!

Kx

[womanofdulwich]

I think the point it that this is traditionally the time that people like to move into family houses- schools etc. There is little on the market and something nice stands out. Good agents recognise this. They are acting for the vendor to get the best price. Vendors hate the messing around and lots of viewings. Sealed bits cuts to the chase. I think you can still put the offer subject to survey etc. Values are back to their 2007 levels and if you want a family house for the medium to long term it does not matter if you pay slightly over the odds to get what you want. Moving house is such a big personal as well as financial investment.

Good luck.

[Loz]

Rather than refuse to put in a sealed bid, put one in for 99p!

[HonaloochieB]

???? Wrote:

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> dead cat bounce

Can't imagine why you're bringing Fall b-sides into this Quids. Aaah.