NZ 1st homebuyers are ScReWeD...

[upside_umop]

You can look at it that way...

I look at it as opportunity. It wont hold me out. It will lower prices further as there will be less support (where will the first home buyers be to buy and support the market bottom?) There will be some...and I'll be one, but I'll buy when the time is right.

Banks are getting shaky on lending and thats fine by me...I'd rather house prices fall than go up while I'm saving.

Another 10% fall next year will fine by me.

[fungus pudding]

[QUOTE=upside_umop;235512]Yes they can.

Ask some agents how many deals in the last 12 months have fallen on finance and not gone through.

Maybe in 'law' they cannot walk away, but a provision in a contract is just that - a provision. And if its proviso is finance, and it has fallen through you cannot make them pay.


Oh yes you can. If finance is the only condition you can arrange the finance for them, which they must accept if its at prevailing terms, or even lend them the money as a vendor mortgage, first, second, third or whatever. Granted - a lot walk away, but not always; have a look at some case law. A subject to finance clause is far more binding than many realise.

QUOTE]

[upside_umop]

Ask around.

[minimoke]

[quote=funguspudding;235533]

Ask some agents how many deals in the last 12 months have fallen on finance and not gone through.

Any agent should be looking to make sure the “buyer” had a pre-approval doc from the bank indicating the borrowing power. It would be a mug agent who would enter into a negotiation process without knowing the real position of the parties.

[upside_umop]

Aren't all agents mug agents? haha

I would think an agent would be a mug if they organised finance for the buyer which was potentially unfavourable..

Back to what you were saying, some agents would rather show them properties, get the potential buyers excited and then worry about finance, instead of scaring them away telling them they need pre-approved?

US in recession woo hoo...

[Dr_Who]

[quote=minimoke;235544]

Any agent should be looking to make sure the “buyer” had a pre-approval doc from the bank indicating the borrowing power. It would be a mug agent who would enter into a negotiation process without knowing the real position of the parties.

Ive been in this property game for a long time. Both owning and managing residential and commercial. I can assure you that any agent asking me for a pre approve bank lending doc will be met with a quick response to F off. There are a number of people out there who dont need finance and are cashed up.

You can usually tell the BS artist that have no cash. They are the ones that usually wear all the designer cloths and a flashy watch and flashy car. All their wealth is carried around with them and no cash in the bank.

[minimoke]

... some agents would rather show them properties, get the potential buyers excited and then worry about finance,

Yes, I guess this is what the dumber agents do. Except there is no point committing to paying an Agent an exorbitant commission if all they are going to do is get a buyer excited about a property (actually the buyer does that themselves in the first five minutes) if the Agent doesn’t know a buyer is in a position to complete the deal. Agents like this no doubt wonder why they can’t earn a decent living. And they waste their clients time in the meantime – which potentially devalues the property as it lingers on the market for longer. And don’t get me started on those dumb agents that stick up “Under Offer” signs on the front gate sign.

[minimoke]

[quote=Dr_Who;235552]

I can assure you that any agent asking me for a pre approve bank lending doc will be met with a quick response to F off. There are a number of people out there who dont need finance and are cashed up.

Granted – but the Agent needs the skill to sort out the real buyer from the non-hoper. Their experience can do just as well as a pre-approval doc. And I don’t think this experience comes from someone in the trade for 12 months in a buoyant market.

[upside_umop]

Thats pretty much what I was getting at Minimoke...

Things have changed from the last 5 years. No longer can real estate agents 'expect' finance will be approved because a lot of buyers are now being counted out.

Thus less demand for housing stock... woo hoo another win for first home buyers

[minimoke]

Thus less demand for housing stock... woo hoo another win for first home buyers

Except over the past three months to October, we’ve seen figures which show there are increasing numbers of sales; the time on market is reducing and the median price appears to have bottomed out and is on the slight increase. Too early to suggest a trend, and some of this may be seasonal, but it does indicate no rapid bottoming out of the market. Add to this reduced interest rates and improved housing affordability there to stoke demand, summer encouraging buyers to the market and school zone / job transfers over the new year may all lead to higher sales values. Not a good place for the first time buyer.

Since Shrewd Crude is looking a few years out it might be worth pointing out that the market is not a lot different to where it was two years ago. Back in Jan 07 when he first posted the median price was $327,000, at Oct 08 its $335,000, He would be a lot better off now than then as he still has increased value in his property, he would have paid two years worth of principal off (not much – but it helps) and his interest rates will have dropped a third giving him a pile of extra cash in his hand. Instead he’s lost 50% in the share market, now needs a bigger deposit and he has to find more cash to pay a Valuer.

Two years ago is when first time buyers should have been saying “woo hoo”!