Belarmine Stepaside- estate agents driving prices up

Galwayforliam · 08-07-2017 09:11AM #1

Folks,

I appreciate that this is not a new phenomenon but it's nonetheless depressing for first time buyers!

So two properties in Belarmine just went sale agreed (3 beds- one with attic converted and one not) for substantially more than the asking price. We bowed out when it was apparent that the prices were going to stay going through the roof and the estate agents seemed like they couldn't be trusted and were hounding us.

Anyways, after one went sale agreed and deposit was paid etc the estate agent said to us that look the owner heard a similar property just went for €525k and while they were sale agreed for €517.5k, the owner would take €525k if we were willing to stretch that far...

I found this pretty disgusting that some couple were sale agreed and the estate agent was still looking for more and said they'd return deposit to the couple who went sale agreed if we could beat their price.

Worse again, the same estate agent got onto us yesterday saying that the other house was now gone m up to €530k after going sale agreed at €525k and he wanted to know if that was us that bidded on it!

So basically 7 Belarmine Place is apparently at €530k now (guide €485k) while 17 Belarmine Close is still there for anyone to outbid sale agreed price of €517.5k (guide €465k).

Both prices are setting a new record for the area and prices hadn't gone over 500k for a 3bed until now. The estate agents are driving these prices up just like the boom and bear in mind a 3 bed was just €395k a year ago and a converted attic apparently is now worth €130k when it would only cost you €15k to convert yourself!

Whatever about the market going out of control, I find it horrible that estate agents are willing to change their mind on sale agreed prices if they think they can get another few grand.

These will be the new 'norm' prices for the area when they go through and deffo overpriced.

Yours a frustrated first time buyer...

AmberGold · 08-07-2017 09:19AM

Yes Estate Agents are snakes, in this case the sellers must also be aware of what's going on. In any event the EA will just say they are taking direction from the seller if a formal complaint is made.

Not something that I have seen too much of in Ireland in the past but common enough in the U.K.

Galwayforliam · 08-07-2017 09:23AM

Yeah they know what they're at and I'm sure they're legally covered, just seems really wrong when sales agreed that process can reopen again.

It actually felt like they two EA were working together to drive prices up as one of them in particular knew an awful lot about what price the other house was going for and using it as leverage to drive his own house price up.

I genuinely don't know if we'll ever be able to buy at this rate when the guide price is being beaten by up to €60k for a 3 bed.

LincolnHawk · 08-07-2017 09:39AM

Know the max you are willing to pay for any given property and let it go if it goes beyond that. Try not to get emotionally invested in any of them an be clinical...until you get the keys.
Sorry your frustrated though OP, it's not a nice experience

Galwayforliam · 08-07-2017 09:44AM

We're not - we're trying to be as grounded as possible and not be fooled by converted attics as a 4th bedroom that look well but command a €100k plus premium.

I would have been reasonably happy paying €500k for 7 belarmine though as it was a nice spec and in our range but anything over that is just not worth it given they were just €395k less than a year ago and even €500k is well overpriced. But there's no availability and buyers prepared to go €60k over asking is making it so much more difficult and longer we leave it the more prices will go up and we may not be able to afford anything!

wordofwarning · 08-07-2017 10:13AM

The EA did not drive up the price, the market did. Another buyer has come along and said I want to buy the property for X price. It is not the EA is wanting to charge the price, it is the demand setting the price. He put this to the seller and they accepted.

At the end of the day, the EA wants to wrap all of this up ASAP. If he is a 1% sales fee agent. I seriously doubt he is loving the extra €50 from 5k more when the house will not be closed for months now and he is dealing with more admin etc. I imagine the EA would have been delighted with €517.5k to wrap this all up and where he can focus on another sale with serious commission.

Galwayforliam · 08-07-2017 10:46AM

I don't agree. The sale was wrapped up at €517.5k and gone sale agreed.

Following my email enquiry the EA said to "ring him asap" and he proceeded to tell me that the price was sale agreed at €517.5k but that the owner is now aware that a similar house went for €525k (attic converted into room) and that if we could stretch to €525k the owner would accept this offer cancelling the other sale agreed price. If there was nothing in it for the EA then why would he bother trying to get me to bid higher after it was sale agreed?

A practice that I know for a fact is going on in market is that sellers offer the EA higher commission if they reach certain targets. E.g. €40k over the asking price, €5k extra commission and this leads to the EA working the asses off to get the highest possible price. It's win win for the owner and EA- I'm not saying everyone is doing this but I know of two examples through people I know.

LincolnHawk · 08-07-2017 11:31AM

You'll tie yourself up in knots with this stuff. Just bid what it's worth to you and don't concern yourself with what you think might be going on behind the scenes

08-07-2017 12:05PM

Do you have to stay around stepaside, if you are spending that sort of money why not look at a new houses in Greystones A rated and Greystones is a fantastic area lifstyle wise, on the coast and its got the Dart.

Galwayforliam · 08-07-2017 12:10PM

Yeah greystones is lovely but the commute is too long on m50 to work plus prices aren't cheap either. The new development in Marina Village are looking for 765k for a 4bed! Not welded to belarmine at all, just giving example of the prices they're going for.

Bishops Gate sold out before viewings took place with queues over night and clay farm we're waiting to here when available but with all these, the queue of people is insane!

notharrypotter · 08-07-2017 12:22PM

Galwayforliam wrote: »

I don't agree. The sale was wrapped up at €517.5k and gone sale agreed.

Following my email enquiry the EA said to "ring him asap" and he proceeded to tell me that the price was sale agreed at €517.5k but that the owner is now aware that a similar house went for €525k (attic converted into room) and that if we could stretch to €525k the owner would accept this offer cancelling the other sale agreed price. If there was nothing in it for the EA then why would he bother trying to get me to bid higher after it was sale agreed?

A practice that I know for a fact is going on in market is that sellers offer the EA higher commission if they reach certain targets. E.g. €40k over the asking price, €5k extra commission and this leads to the EA working the asses off to get the highest possible price. It's win win for the owner and EA- I'm not saying everyone is doing this but I know of two examples through people I know.

The Estate Agent works for the seller not you.
In any property sale there are 2 parties.
The buyer (in this case you) and a seller.

Under Irish law until the contracts are signed by both parties then each party is free to withdraw from the transaction.

The aim of the seller is to maximize the price.
While the buyers aim is the exact opposite, to pay as little as they must to acquire the e property.

A seller will balance the current offered price with any potential future offer.
If they think they can achieve more then they would seriously consider changing their mind.

Its human nature.

Claw Hammer · 08-07-2017 04:38PM

wordofwarning wrote: »

The EA did not drive up the price, the market did. Another buyer has come along and said I want to buy the property for X price. It is not the EA is wanting to charge the price, it is the demand setting the price. He put this to the seller and they accepted.

At the end of the day, the EA wants to wrap all of this up ASAP. If he is a 1% sales fee agent. I seriously doubt he is loving the extra €50 from 5k more when the house will not be closed for months now and he is dealing with more admin etc. I imagine the EA would have been delighted with €517.5k to wrap this all up and where he can focus on another sale with serious commission.

The EA wants the high price, not because of the commission but because of reputation.He wants the next sale. Not a chance of getting another sale in the area if a rumour goes around that he undersold a house.

wordofwarning · 10-07-2017 01:31PM

Galwayforliam wrote: »

I don't agree. The sale was wrapped up at €517.5k and gone sale agreed.

Following my email enquiry the EA said to "ring him asap" and he proceeded to tell me that the price was sale agreed at €517.5k but that the owner is now aware that a similar house went for €525k (attic converted into room) and that if we could stretch to €525k the owner would accept this offer cancelling the other sale agreed price. If there was nothing in it for the EA then why would he bother trying to get me to bid higher after it was sale agreed?

You are entitled to your opinion. I don't agree with it at all though. The EA has two options A) Close this sale ASAP and get his cheque in the mail.

Get an extra €75-150 in commission. Open the sale process again, fill out more paperwork, spend several more hours on the sale and take focus off more important sales. What is the more rational explanation?

In Superfreakonomics, they discuss how real estate agent want to close a sale ASAP to get their cheque and move onto the next property. Would you want to spend a day of admin for an extra €75? Maybe you would, but most people would not be bothered

KyussBeeshop · 10-07-2017 05:38PM

Inflating property prices is a valuable and very lucrative business, which estate agents are incredibly well placed for facilitating - if estate agents and other financial/property-related actors (those who stand to gain from increased property prices) are open to colluding, then there are ample means for the latter to provide rewards to estate agents for this collusion, in excess of operating costs (e.g. a nice paying job, board position or other career advancement, in the future).

kippy · 10-07-2017 05:44PM

wordofwarning wrote: »

The EA did not drive up the price, the market did. Another buyer has come along and said I want to buy the property for X price. It is not the EA is wanting to charge the price, it is the demand setting the price. He put this to the seller and they accepted.

At the end of the day, the EA wants to wrap all of this up ASAP. If he is a 1% sales fee agent. I seriously doubt he is loving the extra €50 from 5k more when the house will not be closed for months now and he is dealing with more admin etc. I imagine the EA would have been delighted with €517.5k to wrap this all up and where he can focus on another sale with serious commission.

That would be well and good in a scenario where the estate agent was only selling one house ever but the reality is that rising prices across the board and contributing to that trend increases their fee income drastically over a few calendar years....
The EA acts for the seller so it is in their interest to increase the price for the seller and in the medium/long term for themselves as well as the sale agreed prices will effect prices in a similar area for a similar property.

And OP - I feel your pain.
It is all well and good for people to advise you to stick to a price and walk away if it goes over that price but when you need to tie yourself down to a house, when rents are spiraling and your deposit value is dwindling - it is very difficult to head this advice as you'll need to adjust one of a number of factors to secure the house.
At some point you got to decide whether to hold out and wait for things to crash/calm down (which is't in any way a good position to be in either) - or get on the merry go round and accept the risks associated with same.

Galwayforliam · 10-07-2017 06:16PM

Thanks folks and I certainly agree there's more in it for EA than €75 for driving the price up another notch - even if they aren't being giving a bonus by the seller for reaching SP target, they will reap the reward in future sales as the base price will jump.

It's just greed imo and for sake of few extra grand you'd think seller would be happy with getting €60k over asking price without breaking from sale agreed status.

Anyways it is what it and I agree we'll have to stretch in current market as we can't afford to wait a few years with a toddler in rented apartment for extortionate rent. Stretching to me would have beeen 15-20k over asking at a push but now we realise the guide is 10% under the actual SP so need to factor that it in going forward.

We won't bid foolishly though. We wanted a 4-bed, now we're compromising to a 3-bed for well under 500k- although maybe not that far under by looks of things and 3beds in most demand. 'Tis a fair mess way Dublin has gone

10-07-2017 07:31PM

Galwayforliam wrote: »

Thanks folks and I certainly agree there's more in it for EA than €75 for driving the price up another notch - even if they aren't being giving a bonus by the seller for reaching SP target, they will reap the reward in future sales as the base price will jump.

Galwayforliam - I hope you are successful in your house hunting. But I bet when you come to sell at some time in the future you will look for an estate agent who you believe will get you the best possible price. An estate agent who doesn't (legally) strive to do so is not doing his job properly and is letting down the owner who engaged him and is paying him. Gazumping is down to the owner - if the owner preferred to stick to the original sale agreed price I bet the estate agent would have been more than happy about it.

.

Galwayforliam · 10-07-2017 08:01PM

Hi, well the owner is pushing the EA for sure as there have been three viewings with the asking already achieved.

Look it is what it is but if we do ever get to buy and sell a house and if we do achieve over our asking price and go sale agreed we won't be reopening for another offer, that's just pure greed at that stage.

Anyways, the market will decide what value is and prices will probably stay pushing up unless people start bidding way under the asking price as a starting point to build from there but that would probably have same net effect anyways! I heard a few houses went for below asking around Sandyford Hall I think so maybe there's hope yet!

sheep1234 · 11-07-2017 10:09PM

I am surprised that the prices have gone so high in Belarmine, I was viewing/bidding back in April on a 3 bed there and the asking was €425k, i believe it finished up around €475k (same 3 bed end of terrace type) That's a huge increase in such a short space of time. Seems extortionate.

Have heard the last 3 bed in Sandyford Hall went well over the asking 40k over I hear at €485k , and that was 7/ 8 weeks ago, so may be more now.

Have gone sale agreed now but it's a difficult market out there...

Galwayforliam · 11-07-2017 10:18PM

Yeah that's the thing, really dramatic price increase of over €100k in a year is pretty mental for a 3 bed.

I can't justify it in my head but maybe it will look like a steal in another year!

What's the address of your sale agreed house- I might throw in a higher bid to the EA?

Best of luck with it- nice to get sorted

mikeybrennan · 11-07-2017 10:22PM

what were these houses worth at the bottom of the market?

will they tank again?

Galwayforliam · 11-07-2017 10:43PM

Check out property price register - around 2012/2013 lowest years. Belarmine 3beds roughly 250k back then from a glance. I know Belmont launched at €345k in late 2013/ early 2014 and they're €500k now.

I wouldn't say they'll tank unless Leo Varadkar has an ace up his sleeve to get thousands of houses built in Dublin fast. He'll cut vat rate alright maybe few other things but there's a chronic housing supply which can't be solved over night so price to stay increasing for another 2 years is my guess and nobody can give a real view without knowing government plans for intervention in market.

If you buy in a good area near transport you should be ok but getting into bidding wars over properties that are going for way over asking is foolish imo

Palmy · 11-07-2017 10:46PM

What's the typical rate an EA makes on a deal. Here in the U.S it's 6% of the sales price. 3% for the listing agent and 3% for the buyers agent. If you bring a seller yourself you get 6%. You then have to pay your broker out of the deal which can go from 50-90% split in favorite of the agent. So if your 3% commission was $10,000 and you where on a 70-30 split the agent gets $7000 and the broker gets $3000. This is the deal I am on with my broker.

Diemos · 12-07-2017 04:01PM

mikeybrennan wrote: »

what were these houses worth at the bottom of the market?

will they tank again?

Don't play that game, nothing good will come of it, look forward not back.
Check out other property bubble crashes and recoveries and it will give you a good indication on where things are going.

Will they tank again? I would say yes, we have learned nothing, the same mistakes are being made all over again, but the crash will be years away yet. By then, Leo & co will have sailed into the sunset ala Bertie and his slimey crew. With zero fcuks given about the mess they leave behind.

OP, best of luck.

Belarmine Stepaside- estate agents driving prices up

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