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Finance & Stock Groups Forum Index » Real Estate » FT: 'Gazundering' in housing slump price cuts
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 Posted: Sat Sep 06, 2008 2:19 pm |
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'Gazundering' in housing slump price cuts
Financial Times
By Sharlene Goff
Published: September 5 2008 22:34 | Las
Gazundering, the phenomenon whereby homebuyers take advantage of the
housing slump to cut the price of properties at the last minute, is
reaching new extremes, with estate agents reporting hundreds of
thousands of pounds being slashed from offer prices just hours before
exchange.
Estate agents said sellers of very desirable properties in parts of
London had accepted offers as much as a third below their asking
price.
Jonathan Cunliffe, an agent with Savills, said most offers were now
coming in at 10-15 per cent below asking price.
Savills reported one case of a buyer knocking off £250,000 from a £3m
home in Fulham on the day of exchange.
In another case £100,000 was cut on the day of exchange from the price
of a property that had already had its price driven down from £2m to
£1.6m.
Vendors of even highly desirable homes are accepting lower prices
rather than wait for the market to depress prices further.
Across the market gazundering is now common. “At the moment there is
not a single transaction that doesn’t involve some form of
gazundering,” said Richard Everitt at the east London area Winkworth
branch.
The government’s decision to raise the nil-rate stamp duty threshold
by £50,000 to £175,000 for the next 12 months has already propelled
sellers at the lower end of the market to reduce their asking prices.
Estate agents said some vendors selling properties in the region of
£195,000-£200,000 had instantly knocked down the price to £175,000 to
entice buyers. |
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