Research from Zoopla suggests that homeowners are overpricing properties, leading to over a third on the market having their asking price reduced at least once.
With house prices seemingly on an unstoppable upward curve, are overzealous sellers to blame? Or is lack of demand forcing prices down?
The top 10 areas for house price reductions
Currently, 34.08% of homes listed on the market have had their price reduced, up nearly 6% compared to last year. The average discount is 8.08%, which equates to a substantial £24,823.
In a survey of the UK, Zoopla found that the area with the highest number of homes being reduced was Kingston-upon-Thames, where nearly half of the properties listed have been reduced at least once. The average price reduction was below that nationally, at 7.35%, but the area’s high house prices meant that it equated to £78,625.
The regions with the most reduced properties, currently on the market, are:
- Kingston-upon-Thames – 48.14%
- Darlington – 45.52%
- Stockton-on-Tees – 43.22%
- Middlesbrough – 39.39%
- Bishop Auckland – 39.05%
- Hartlepool – 38.25%
- Rotherham – 37.61%
- Halifax – 31.49%
- Accrington – 30.50%
- Isle of Man – 29.34%
The top 10 regions, by average reduction are:
- Kingston-upon-Thames – £78,625
- Isle of Man – £34,499
- Halifax – £13,426
- Stockton-on-Tees – £13,108
- Hartlepool – £11,502
- Middlesbrough – £11,256
- Bishop Auckland – £11,224
- Darlington – £10,604
- Accrington – £9,736
- Rotherham – £9,665
Lawrence Hall, spokesperson for Zoopla, commented: “There has been an increase in the number of reduced properties on the market since earlier this year – good news for first time buyers trying to get onto the property ladder.”
How do you get the price right in the first place?
Zoopla suggests that homeowners are overpricing their properties, which is an easy trap to fall into, especially when house prices are regularly front-page news. On one hand, your home is often worth more than money. The memories and sentiment that you hold to the property may cause you to err on the high side. On the other hand, a modest price will potentially sell quicker.
It’s not an easy one to get right.
Working out the correct price for your house can be achieved by considering things such as:
Your selling strategy: Are you trying to sell the house quickly, or for the highest possible price?
Your own research: Your mortgage valuer or estate agent may give you guidance, but look beyond their figure. How much do houses sell for locally? How does this figure compare? A second opinion can be valuable.
Haggling: Many buyers presume there is space for negotiation, so be prepared to adjust for that.
Factor in stamp duty: The way stamp duty is calculated changed in 2014, so ensure that you have the latest information.
The drop in house prices may not be promising for homeowners, but it may be good news for beleaguered first-time buyers, who will want to make the most of the price reductions.
For more information about buying your first home, or moving to your second, third or beyond, don’t hesitate to get in touch using the phone number at the top of the page.