WARNING: Over-priced homes take twice as long to sell
Zoopla says that sellers who are too ambitious with their asking price can wait much longer to achieve a sale.
Over-priced properties take twice as long to sell compared to others where no reduction is necessary during marketing, according to the latest Zoopla HPI.
The portal says homes that need to lower their asking price to attract more interest take on average 2.4 times longer to sell.
This extended time on the market from listing to an agreed sale is in addition to the four to six months it takes for a sale to usually complete (subject to contract).
Quicker sales
In the North, a combination of fewer homes on the market than a year ago and better affordability, is leading to quicker sales times, Zoopla says.
For example, the average time to sell a home in the North West and North East of England in July was 27 days, 23% faster than the national average of 35 days.
Whereas in the South, the number of homes for sale is higher than a year ago, while higher house prices create affordability problems that have extended the time it takes to agree a sale to an average of 39 days in July.
Attract interest
Zoopla says market conditions have softened since the end of the Stamp Duty holiday in March. And there has been a steady increase in homes for sale with price reductions to try and attract buyer interest.
In July, one in 10 homes registered a cut to the asking price, well above the five-year average of 6%.
The risk of being too ambitious on price is your home taking more than twice as long to find a buyer.”
Richard Donnell, Executive Director at Zoopla, says: “There is plenty of demand for homes and more people are looking to move. However, buyers also have much greater choice, especially across areas of southern England.
“Sellers need to understand local market conditions when considering how to market their home, setting the right price and how quickly they would like to sell.
“The risk of being too ambitious on price is your home taking more than twice as long to find a buyer – or not selling at all,” he warns.
Industry reaction
The lender
Tomer Aboody, Director at MT Finance, says: “In a buyer’s market, where fewer buyers are looking to take the plunge, sensitively-priced homes will usually sell quicker, as sellers compete.
“Pricing isn’t the only factor in selling, as homes in good condition can always attract a premium with buyers reluctant to spend more savings on carrying out refurbishment works.”
The estate agent
Amy Reynolds, Head of Sales at Richmond estate agency Antony Roberts, says: “We are seeing a lot of price reductions, and those reductions do lead to sales.
“It’s a real challenge to get pricing right at the moment with all the political talk around potential tax changes, as well as the significant amount of Stamp Duty buyers face.
“Here, the mid-range market is still healthy, whereas it’s tougher at the first-time buyer level and at the very top end,” she says.
“When a property is initially overpriced, it can sit for a while, but once the price comes down to where buyers feel it should be, it will sell.”
The industry leader
Nathan Emerson, CEO at Propertymark, says: “It remains important that sellers continue to have realistic price expectations and place their property on the market accordingly to help empower an efficient sales process.”
