Leading auctioneer says market recovery ‘due to cash buyers’ only
Auction House boss Jeremy Prior says the property industry might not be as resilient as some pundits think with more and more cash buyers skewing figures
The boss of the UK’s largest residential and commercial property auction company is warning that the industry might not be as resilient as recent popularised figures show as the number of cash buyers continues to climb and could be distorting underlying figures.
Against a backdrop of easing interest rates and a reduced inflation rate of 4.6% many market pundits maintain that the housing market is still buoyant.
URGING CAUTION
But Auction House Managing Director Jeremy Prior (main picture) is urging caution and claims it is too early to see this as a sign of recovery.
Indeed, while the cold winds of reality are taking a firm hold within the housing market as vendors experience some of the hardest selling conditions in 30 years Prior says that at the ‘coal face’ things look very different.
The UK House Price Index reveals that, on average, homes are selling for £18,000 below asking price. But Prior says that in the last 12 months property prices have fallen by 1.2% and Auction House are seeing values down as much as 30% from the highs of 2021.
He says: “This downward trend appears to be far from over, as The Office for Budget Responsibility (OBR) have forecasted that UK house prices will plummet by a further 4.7% in 2024.
“As the cost-of-living crisis continues to damage buyer budgets, the number of homes available for sale is 34% higher than last year.
“With less competition, buyers have been leveraging their strong bargaining position to secure sales with substantial discounts.”
PROPERTIES LANGUISHING
And while Prior acknowledges that the current climate undoubtedly favours buyers he also warns: “Vendors who are unwilling to accept this reality are seeing their properties languishing on the market for months at a time without so much as a whisper of interest.
“The expression ‘wake up and smell the coffee’ has never rung so true and owners of property wishing or needing to sell must do exactly that.”
And he adds: “Do not be persuaded to hang in there at unrealistic price levels recommended by the ever-eager estate agent wishing to boost the stock levels on their register, the simple truth is that the property will not sell.
“Cash buyers are poised to become the largest buying group in 2024. The new year looks set to be a turning point for the industry.”
