# Apartment won't sell



## gortbeg (15 Jan 2007)

I have my apartment on the market with a top auctioneer since last September and it still hasn't sold.  I am moving into my new house in two weeks and am already paying for two mortgages.  The apartment was valued at 280k and I put it on the market for 270k.  It is a two bed apartment and is only a year old.  What else can I do.  I suggested dropping the price again but the auctioneer said I'm mad to do this.  I'm seriously getting worried about it.  Is anyone else in the same position as me?


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## Guest118 (15 Jan 2007)

How much did you buy the apt. for?


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## ryan-neil (15 Jan 2007)

Where is the apartment located. Is there much for sale in the area?


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## beattie (15 Jan 2007)

gortbeg said:


> I have my apartment on the market with a top auctioneer since last September and it still hasn't sold. I am moving into my new house in two weeks and am already paying for two mortgages. The apartment was valued at 280k and I put it on the market for 270k. It is a two bed apartment and is only a year old. What else can I do. I suggested dropping the price again but the auctioneer said I'm mad to do this. I'm seriously getting worried about it. Is anyone else in the same position as me?


 
It looks like you will have to reduce the price as you don't want to be in the situation of where you have to service 2 mortgages. There is a large supply out there so to get a quick sale you have little option IMO.


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## bobbles (15 Jan 2007)

I also have my duplex on the emarket since October, no offers as yet and we have put 2nd depoit on new house. We are now trying to get back deposit as we cannot sell our own, but its really up to the buliders if they will or not.
The market sems to be so quiet and I hoped it would pick up but is hasnt so far and its unlikely it will before March maybe even April.
Maybe you should drop the price although if there isnt much interest anyway then its unlikely that will do any good.
Could you not rent out your apt??


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## hmmm (15 Jan 2007)

_deleted by poster_


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## plaudit (15 Jan 2007)

Property prices are falling, you need to reduce your asking price to reflect this, its much the same principle as people increasing asking price as the market was rising.


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## Tarquin (15 Jan 2007)

I was


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## andagda (15 Jan 2007)

gortbeg said:


> I suggested dropping the price again but the auctioneer said I'm mad to do this. I'm seriously getting worried about it.



Gortbeg, there are two competing interests at play here:

- Your interest: As you and others have mentioned, the market is 'quiet', to say the least. There's a lot of anecdotal evidence that properties just aren't shifting - I know someone else with an nearly-new apartment on the market since last September. You can hold out at the price you're at while those around you reduce theirs, but then you might have to reduce yours even further to get below the new asking price for similar properties. 

- The auctioneer's interest: The auctioneer is interested in more than just the money they make from the sale on your own individual property. They're more interested in the overall market - and of course the last thing they want happening is for you to reduce the price, putting downward pressure on their market. And the auctioneer is desperately hoping that other auctioneers are telling their clients the exact same thing, in order to keep the house of cards standing up.

It's a tough one - I hope it works out for you.


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## Becca (15 Jan 2007)

This is a direct copy & paste from an e-mail I received from an auctioneer. I won't mention where it is in Ireland and I have x'd out the low rental values.


> At present there is a glut of rental and sale property on the market. The only thing going well is development land near town. Rental market is dependent on non-nationals who are getting fussy about properties. If you get from xxx to xxx per week grab it.


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## phoenix_n (15 Jan 2007)

If you are bullish on the Irish Property market and think that the current slowdown will pick up in Spring then hold out on your asking price and suffer two mortgages until the place is sold. Be mindful of the extra pressure the next rate rise in Feb will bring.

If you are bearish on the market lower you price by 10-15% to attract attention and hope for a couple of interested parties to bring the price up again.


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## Sunny (15 Jan 2007)

phoenix_n said:


> If you are bullish on the Irish Property market and think that the current slowdown will pick up in Spring then hold out on your asking price and suffer two mortgages until the place is sold. Be mindful of the extra pressure the next rate rise in Feb will bring.
> 
> If you are bearish on the market lower you price by 10-15% to attract attention and hope for a couple of interested parties to bring the price up again.


 
Good news is that the rate rise won't happen till March instead of Feb but doubt that is of much consolation! It is very hard to advise you what to do without knowing more. Have you had many viewings, what is happening with general real estate in your area, is the estate agent up to the task, how much equity do you have in the house etc etc..I certainly wouldn't suggest droping the price by 10-20k without knowing more.


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## demoivre (15 Jan 2007)

Sunny said:


> Good news is that the rate rise won't happen till March instead of Feb



Really? How do you know that for certain? To the op  -  can you avail of an interest only option on one or both properties until you sell the apartment?


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## Sunny (15 Jan 2007)

demoivre said:


> Really? How do you know that for certain? To the op - can you avail of an interest only option on one or both properties until you sell the apartment?


 
I know with as much certainty as people saying it will happen in Febuary
Unless they do a Bank Of England surprise job on us, they have already signaled to the market that it will be March. Doesn't help the OP though.


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## DirtyH2O (15 Jan 2007)

andagda said:


> Gortbeg, there are two competing interests at play here:
> 
> - Your interest: As you and others have mentioned, the market is 'quiet', to say the least. There's a lot of anecdotal evidence that properties just aren't shifting - I know someone else with an nearly-new apartment on the market since last September. You can hold out at the price you're at while those around you reduce theirs, but then you might have to reduce yours even further to get below the new asking price for similar properties.
> 
> ...


 

I don't agree with this point of view - I believe that sellers want high prices, auctioneers want high volumes. It seems like a popular misconception to blame the auctioneers for our own greed. If all property trades were done online with no auctioneer would we blame the computer?


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## demoivre (15 Jan 2007)

Sunny said:


> they have already signaled to the market that it will be March. Doesn't help the OP though.



On the contrary Trichet's comments on  Jan 11  gave no concrete support to that view.


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## Sunny (15 Jan 2007)

demoivre said:


> On the contrary Trichet's comments on Jan 11 gave no concrete support to that view.


 
The market doesn't agree with you the futures market is priced for a March hike

http://www.bloomberg.com/apps/news?pid=20601087&sid=adb5l8wtu51A&refer=home

This really isn't the thread for it so we can can agree to differ


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## DirtyH2O (15 Jan 2007)

I used the estate agent who had sold the most properties in the development and it was gone in a week. There wasn't a glut at the time though. Would you rent it out for a few months to reduce the burden until the buyers return to the market?


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## gortbeg (15 Jan 2007)

Thanks for all replys.  I have gone intrest only on the apartment but repayments are still high.  Mortgage left on apartment is 200k and I'm selling for 270k.  The apartment is in Oranmore in Galway - all other apartments in this area are priced at 280k-300k.  They are still selling brand new ones for 270k and there are a few of these left so maybe that is where I'm going wrong.


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## hmmm (15 Jan 2007)

gortbeg said:


> all other apartments in this area are priced at 280k-300k.  They are still selling brand new ones for 270k and there are a few of these left so maybe that is where I'm going wrong.


You're saying that second hand apartments are priced at more than new ones?! The builders probably have a better handle on where the market is at than the individual punters trying to sell, I'd pace my price off of them.


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## Fergal (15 Jan 2007)

Is it possible that your auctioneer has a close relationship with the developer? In that case he would not want you to drop prices lower than the developer's prices. 
PS
I agree with an earlier poster that individual auctioneers will see a sale as more important than colluding with other auctioneer to artificially trying to sustain high prices.


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## Bananaman (15 Jan 2007)

As said before its only worth what someone will pay and if there's no interest the best way of attracting some is to lower the price.

If your certain your not going to rent it, i personally wouldn't be holding on to it. Especially with two mortgage's & considering even the most bullish of commentators predict little or no price rises this year.

My advice- drop the price and avoid two mortgages and if you have the time, sell it yourself as mentioned and save on fees

Best of luck with the sale


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## demoivre (16 Jan 2007)

Sunny said:


> The market doesn't agree with you the futures market is priced for a March hike
> 
> http://www.bloomberg.com/apps/news?pid=20601087&sid=adb5l8wtu51A&refer=home
> 
> This really isn't the thread for it so we can can agree to differ



Unlike yourself I haven't made any definitive statement in this thread about the timing or direction of interest rate changes so the futures market agreeing or disagreeing with me doesn't arise. I merely questioned your assertion that the "  Good news is that the rate rise won't happen till March instead of Feb. "  I was curious as to your certainty about an event that you can't be certain about and  I felt your statement might be misleading for some people reading this thread.


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## Sunny (16 Jan 2007)

demoivre said:


> Unlike yourself I haven't made any definitive statement in this thread about the timing or direction of interest rate changes so the futures market agreeing or disagreeing with me doesn't arise. I merely questioned your assertion that the " Good news is that the rate rise won't happen till March instead of Feb. " I was curious as to your certainty about an event that you can't be certain about and I felt your statement might be misleading for some people reading this thread.


 
On the contary you made a difinitive statement saying that Trichet said nothing on Jan 11 that would make people think that the rate rise was happening in March rather than Feb. I was just repsonding to someone who said a rate rise was going to happen in Febuary. I should have said "in all probability" it won't happen till March so sorry for that.


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## gortbeg (16 Jan 2007)

I meant that for a 2 bed apartment in Oranmore are selling from 280-300k.  The new ones in my estate are selling for 270k and are being sold by a different auctioneer to the one I am using.  On the plus side I actually got a call yesterday about viewing for today so fingers crossed something good comes out of it.  I was actually just about to put it on Myhome.ie when I got the call.  The auctioneer already has the apartment on daft.ie.  If nothing comes out of the viewing today should I have it up on myhome.ie as well or is having it on daft enough.  Thanks for all the feedback.


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## pjq (16 Jan 2007)

Check out the post on selling yourself , http://www.askaboutmoney.com/showthread.php?t=44901 , I thinlk that myhome.ie is locked up by the EAs and individuals cant advertise there . Put up your own daft.ie advert , its worth paying premium to be at the top of the list , there are plenty properties listed twice by different EAs .
Lastly , I have sold a house in a rural area ( see above link ) on daft , in the dead month of August I got 10 to 20 hits a day , this increased to 40 - 60 a day in the frenzy of October , the hits dropped dramatically with budget speculation in late Nov and in early Jan it was only 100 hits in a week . Maybe you have to wait for the the next selling season , the newspaper suppliments and the EAs will russel up a frenzy that will float your boat also .
pjq
PS drop the EA and put his fees twords 1. an early sale at a reduced price or 2. the extra interest on your mortgage payment to hold out until the selling starts again .


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## andagda (16 Jan 2007)

pjq said:


> the hits dropped dramatically with budget speculation in late Nov and in early Jan it was only 100 hits in a week .



Does anyone still seriously believe that it was budget speculation that slowed the market? The only people still trotting out that line are the vested interests who want more than anything to convince us the party is still going. Buyers were not waiting to see what would happen in the budget - they knew that any decrease in stamp duty would not make buying a house any easier, it would merely go into the sellers' pockets.

Stamp duty is a tax on the _seller_, not the buyer. If anyone was waiting for the budget it would have been the vendors. There's an argument to be made that the stamp duty system in and of itself is damaging to the market because it hampers movement, and perhaps it should indeed be reformed,  but no individual buyer is thinking about that when deciding to make the plunge on any one house.

Remember, just because you hear a particular opinion on the news from an estate agent/auctioneer/mortgage-provider repeated over and over again that doesn't mean it's necessarily true - or even that the person giving the opinion really believes it themselves.


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## beattie (16 Jan 2007)

andagda said:


> Does anyone still seriously believe that it was budget speculation that slowed the market? The only people still trotting out that line are the vested interests who want more than anything to convince us the party is still going. Buyers were not waiting to see what would happen in the budget - they knew that any decrease in stamp duty would not make buying a house any easier, it would merely go into the sellers' pockets.
> 
> Stamp duty is a tax on the _seller_, not the buyer. If anyone was waiting for the budget it would have been the vendors. There's an argument to be made that the stamp duty system in and of itself is damaging to the market because it hampers movement, and perhaps it should indeed be reformed, but no individual buyer is thinking about that when deciding to make the plunge on any one house.


 
If it was the SD issue which slowed the market it should have filtered out by now.


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## davet (16 Jan 2007)

andagda said:


> Buyers were not waiting to see what would happen in the budget - they knew that any decrease in stamp duty would not make buying a house any easier, it would merely go into the sellers' pockets.
> 
> Stamp duty is a tax on the _seller_, not the buyer.



Eh tax on the buyer not the seller surely. Its paid by the buyer afterall


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## cik (16 Jan 2007)

davet said:


> Eh tax on the buyer not the seller surely. Its paid by the buyer afterall



In modern Ireland Buyers have been spending everything the banks will let them borrow and therefore Sellers have been receiving everything banks will let Buyers borrow, minus the Stamp duty.

If there was no Stamp duty the Seller would simply recieve a higher amount as the Buyer seems to spend every single penny he can get his hands on.

When Buyers spend the maximum no matter what then the eventual destination is less relevant to them, it is more relevant to the seller as it is money they arent getting (that they could be getting).
Hence it is a tax on the Seller.

....

As for this thread it seems we have a new participant in the whole game - the motivated seller


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## Remix (16 Jan 2007)

davet said:


> Eh tax on the buyer not the seller surely. Its paid by the buyer afterall


 

I first came across this paradox on Shane Ross's . Does make sense when you work throught the logic and consider what happened to prices after the last stamp duty adjustment.

[written 2005]


> There is a bit of a myth about stamp duty as it is not a tax on the buyer but on the seller - nobody quite realises this. The former Minister for Finance was in full agreement with me in this regard....
> 
> Let me explain what I mean. If one buys a house and pays 6% or 7% of the cost as stamp duty, or 9% if one pays at the top rate, one must have the money to do so. One must have borrowed it or acquired it somehow and have it in one’s back pocket. If there were no stamp duty, one would pay the same price for a house because the price would simply increase accordingly. The buyer, who would have the money to pay if there were stamp duty, would be prepared to pay the same amount if there were none. It does not matter to the buyer whether the money is spent on stamp duty or on the house and therefore the person who is actually getting less from this system is the seller. Stamp duty is therefore a tax on the seller although it does not appear to be so.
> .
> ...


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## phoenix_n (16 Jan 2007)

andagda said:


> Does anyone still seriously believe that it was budget speculation that slowed the market?


 
Yes they do. I had a conversation with two colleagues who said the stamp duty caused the slowdow but they were also surprised at my prediction on house prices this year (cant share as is banned) as it went against newspaper articles.

People believe what they read. ( when this is the only source of information that they use )

e.g. weapons of mass distraction.


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## demoivre (17 Jan 2007)

Remix said:


> I first came across this paradox on Shane Ross's . Does make sense when you work throught the logic and consider what happened to prices after the last stamp duty adjustment.
> 
> [written 2005]



His argument is largely based on the premise that  "If there were no stamp duty, one would pay the same price for a house because the price would simply increase accordingly ". The present stamp duty system would see €72000 payable on an €800k house, for example. How the removal of stamp duty would, de facto, result in that house  price increasing to €872000 is beyond me and it would be an even more bizarre argument in a slowing or falling market imo.


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## demoivre (17 Jan 2007)

phoenix_n said:


> Yes they do. I had a conversation with two colleagues who said the stamp duty caused the slowdow but they were also surprised at my prediction on house prices this year (cant share as is banned) as it went against newspaper articles.
> 
> People believe what they read.



I don't.


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## phoenix_n (17 Jan 2007)

demoivre said:


> I don't.


 
 Well found. But I can't comment as the subject is verboten but I am sticking by my original prediction. 

Asking price may not necessarily reflect actual selling price.


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## Remix (17 Jan 2007)

demoivre said:


> His argument is largely based on the premise that "If there were no stamp duty, one would pay the same price for a house because the price would simply increase accordingly ". The present stamp duty system would see €72000 payable on an €800k house, for example. How the removal of stamp duty would, de facto, result in that house price increasing to €872000 is beyond me and it would be an even more bizarre argument in a slowing or falling market imo.


 
Be it houses or whatever, sellers are usually very efficient at passing on price increases to buyers. Not so snappy at passing on savings.

Successful buyers of €800k houses are already paying €872 - this is the effective cost of the house to them. Sellers and those who work for them know this. Expecting the €72k saving to be simply passed onto the buyer would also be a little bizzare imo.

Unless of course there are very few or no more buyers of 800k houses and a correction is underway. But sure with our booming economy, immigration, full employment etc we've been told that can't happen. Right ?


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## serotoninsid (17 Jan 2007)

hmmm said:


> You're saying that second hand apartments are priced at more than new ones?!


Don't mean to pull this thread off topic but just a quick point.  For 'second hand' homes that are just a year after being signed off, could it not be expected to get the same/a fraction more than the same house in the new phase of a development (selling off plans) on the basis that the new house would be builders finish as opposed to existing which owner has finished off ie. tiling, carpets,etc.?


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## phoenix_n (17 Jan 2007)

serotoninsid said:


> Don't mean to pull this thread off topic but just a quick point. For 'second hand' homes that are just a year after being signed off, could it not be expected to get the same/a fraction more than the same house in the new phase of a development (selling off plans) on the basis that the new house would be builders finish as opposed to existing which owner has finished off ie. tiling, carpets,etc.?


 
Have to take into account Stamp Duty.


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## Dreamerb (17 Jan 2007)

serotoninsid said:


> Don't mean to pull this thread off topic


Or perhaps, back on topic?!  



serotoninsid said:


> but just a quick point. For 'second hand' homes that are just a year after being signed off, could it not be expected to get the same/a fraction more than the same house in the new phase of a development (selling off plans) on the basis that the new house would be builders finish as opposed to existing which owner has finished off ie. tiling, carpets,etc.?


The builder's finish versus owner's finish effect is approximately cancelled out by the stamp duty effect for owner occupiers, so I would expect second-hand in those circumstances to be about the same price or a little less, depending on the price levels. And, of course, the quality of the finish will have an effect, as will the degree of personalisation. High quality bland will generally get you a better price and a quicker turnaround, far as I can see.


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## serotoninsid (17 Jan 2007)

Dreamerb said:


> The builder's finish versus owner's finish effect is approximately cancelled out by the stamp duty effect for owner occupiers


These homes are only going for €190-€220k(not a typo - just one of the least developed parts of the country!).  Have I got it right in thinking stamp duty isnt a factor in this case?


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## phoenix_n (17 Jan 2007)

serotoninsid said:


> These homes are only going for €190-€220k(not a typo - just one of the least developed parts of the country!). Have I got it right in thinking stamp duty isnt a factor in this case?


 
Its a factor if the buyer is not a FTB.
Second hand Property - Stamp of 4% for non-ftb status.

(€190,501 - €254,0000% :4%)


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## Calina (17 Jan 2007)

I think it depends on the square metrage and whether the next purchaser is an FTB or not.


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## demoivre (17 Jan 2007)

Remix said:


> Be it houses or whatever, sellers are usually very efficient at passing on price increases to buyers.



That's only true if the demand for houses is price inelastic which is not always the case, particularly so in a slowing market imo.


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