Estate Agents reluctance to use the phrase 'property crash'

[thejuggler]

Have you ever noticed the way that Estate Agents and other property market vested interests refuse to use the term 'property crash'? Its always 'price correction' or 'easing'.

Even today on Pat Kenys show on rte radio one of Sherry Fitz's big wigs was talking about a 40% easing in prices since the 2006 peak.

Why can't they call a spade a spade and admit that there has been and continues to be a property crash. It might help vendors to accept that prices have fallen by that much.

As it stands if I put an offer of maybe 20% less than asking on a property to an estate agent the reaction is to dismiss the offer out of hand and say that the vendor would not consider accepting such a low offer.

Everyone in this country needs to get on the same page and accept that house prices have fallen 40-50% and that the clearing price for property is now at that level. By my calculation this should put it back to approx 2001-2002 values. If everyone could accept this we should see the market return to normality (and by normality I mean a functioning market where buyers and sellers can operate without the fear of gazumping by investors and where prices are not rising at 10-12 percent per annum). We need the market to level off at that point for the forseeable future.

If this doesn't happen we are going to see a slow decline of maybe 10 % per year for the next 4 or 5 years - same end result. Would it not be better to get the pain over more quickly?

[lowtaxireland]

Have you ever noticed the way that Estate Agents and other property market vested interests refuse to use the term 'property crash'? Its always 'price correction' or 'easing'.

Even today on Pat Kenys show on rte radio one of Sherry Fitz's big wigs was talking about a 40% easing in prices since the 2006 peak.

Why can't they call a spade a spade and admit that there has been and continues to be a property crash. It might help vendors to accept that prices have fallen by that much.

As it stands if I put an offer of maybe 20% less than asking on a property to an estate agent the reaction is to dismiss the offer out of hand and say that the vendor would not consider accepting such a low offer.

Everyone in this country needs to get on the same page and accept that house prices have fallen 40-50% and that the clearing price for property is now at that level. By my calculation this should put it back to approx 2001-2002 values. If everyone could accept this we should see the market return to normality (and by normality I mean a functioning market where buyers and sellers can operate without the fear of gazumping by investors and where prices are not rising at 10-12 percent per annum). We need the market to level off at that point for the forseeable future.

If this doesn't happen we are going to see a slow decline of maybe 10 % per year for the next 4 or 5 years - same end result. Would it not be better to get the pain over more quickly?

But its not a crash- it is a gravitational interaction.

[_soma_]

I dislike the term crash. Its a significant drop in price.

I reserve crash for a 50% fall over 3 months, not 40% since 2006.

A 40% decline in the price of an asset that was immensely popular, and bought-into by a significant percentage of the population, is a crash plain & simple.

To deny that is purely head-in-the-sand childishness.

[Anorakphobia]

To answer the question as to why they find it impossible to say crash, the answer simply is that most of them are born liars, same as bankers, builders, speculators, the CIF, stockbrokers, fund managers and indeed huge swathes of what passes for a Government.

As for "possibly falling 40% from peak"
More lies, it's down that already and acceleratinga s we speak and commercial is down 60.

The whole country is fixated on a tiny cabal of bankers while all other participants in the ponzi are getting an easy ride.

The whole country is fixated with Sean Fitzpatrick instead of looking at the incompetent fools that created the climate and conditions for a thousand greedy pigs like Seanie Fitzs to gorge at the trough.

[myk]

If this doesn't happen we are going to see a slow decline of maybe 10 % per year for the next 4 or 5 years - same end result. Would it not be better to get the pain over more quickly?

this is likely to happen in any case. property markets are illiquid. I understand that common economic thinking is that it takes as long for a property bubble to unwind as it did for that bubble to inflate in the first place. which would mean we are looking at 4-5 years of further decline, possibly more.

[Dillinger]

I dislike the term crash. Its a significant drop in price.

I reserve crash for a 50% fall over 3 months, not 40% since 2006.

It is a crash, it is just that people, are in denial. Apartments that were selling for 255k, now going for 120k, can you imagine how the poor fella who forked out 255k feels, I think he would punch anyone who suggested it is not a crash, especially seeing as we have yet to hit the bottom.

[Geekzilla]

Have you ever noticed the way that Estate Agents and other property market vested interests refuse to use the term 'property crash'? Its always 'price correction' or 'easing'.

Not just estate agents - commentators on the current economic crisis have been reluctant to use the term "crash" to describe it.

[Watcher1]

We dont really need them to call it what it is, the rest of us know. They are not in denial either because they know full well. They just dont want their colleagues to shun them at the next "institute" do.

Where I live, a small rural village, a guy built some houses and retail space - a very small development really. Anyway, he was looking for 400 - 450K for the retail unit at peak. He got an offer of 200 recently but said he would not budge below 300. To cut a long story short, the agent told the buyer that he, the agent, would get the unit for the buyer at 200K because otherwise it would sit there for another year and be worth only 100K.

In case you are wondering, the agent is the sellers agent but the seller is apparently a bit loola so the agent was trying his best to keep the buyer interested and get the unit off the hands of the seller. Sale is not agreed yet.

So, yes, it is definitely a crash and its not over yet. Potential buyers know this and are waiting for prices to fall MUCH further, which they will because no one is taking out loans for property because of the recession. People are not buying houses either because they are afraid of losing their jobs. House prices have a good way to fall yet. I still see one bed apartments, nothing special, all over Dublin for a quarter of a million euro, some under 200K but still a lot over 200 and 250K. That's ridiculous. Until prices get to a level where you can easily afford the mortgage over 20 years, down will come prices. People should not be shackeling themselves to that level of debt for 30, 35 and 40 years. This recession has delivered a long over due reality check to people. That is one good thing to come out of this sorry saga.

[adrem]

To be fair (and I'm not really disposed to being fair to them) the Sherry Fitz site does say that prices have fallen generally by 30% and also that large family homes in Dublin have fallen by 40-50%. That's not really hiding the truth now - yeah they say correction not crash but so what?

[myk]

I dislike the term crash. Its a significant drop in price.

I reserve crash for a 50% fall over 3 months, not 40% since 2006.

so in your definition, the has never been a property crash in history (other than massive natural disasters and wars)?