I read very recently that there is a disparity between asking prices and selling prices in London. In fact property agents in London Douglas & Gordon recently reported a record gap between asking prices for houses and actual sales prices of £79,000 after they compared asking prices on Rightmove with recorded data obtained from Land Registry. That’s a whopping 24% difference. This compares with a difference of £6,574 in 2003.
So what does this tell us about the property market in London? Is the difference down to agents over-valuing property and if so is it due to lack of stock and increasing competition to win instructions? That certainly could be a cynics take on the situation.
Or is it that sellers are refusing to compromise on price and perhaps because of emotional attachments to their property are simply not willing to accept that in a wobbly market it’s far less likely that you will achieve the dizzy prices of 2008?
Will this mean a stagnant market for 2011?
Sell my property
We’ve just launched our online estate agency business and have gained a few sale instructions locally. Certainly we don’t have the stock numbers to provide any significantly researched data, but it’s apparent that sellers do seem to possess a raised expectation of their property value.
Recently we had a seller contact us to value her property. She had already had a few valuations which incredibly ranged from £250,000 to £320,000.
We valued her property due to its location and after having researched recent sales and other stock being marketed at £300,000. She liked our proposition of an upfront fee and no commission, however she also liked the £320,000 valuation offered by another local agent. Obviously we didn’t want to lose the business, so we agreed tentatively to market the property at £320,000 however with a promise from the seller to review her selling price quickly if the response from the portals was not so good. It was flat. Nothing, not even a viewing request! We quickly reduced the price to £300,000 and the response was electric. We had two couples placing offers for purchase, and we quickly secured an accepted offer very close to the asking price and the valuation we originally offered.
What’s my house worth?
Those buying are clearly doing their research beforehand. They seem to know what they are prepared to pay and properties over-valued by the 24% suggested by D&G will simply not sell.
It’s going to be an interesting year for the industry. Will it stagnate further, or will we see sellers reduce their expectations and accept lower offers to secure a buyer? Or will low levels of new stock for sale keep asking prices artificially high?
If you really want to find a buyer, then do your research. If other very similar housing stock is available and seems to be remaining unsold, then you should ask yourself ‘will my property sell for a similar amount?
So far we’ve achieved an average of 96.77% of the asking prices on the properties we’ve been instructed to sell. However we think its because the sellers have listened to our advice on how to achieve a sale by marketing at a realistic price.
Fishneedwater offers a valuation from a RICS accredited Chartered Surveyor as part of our great value online service for property sellers. Selling fees start as low as £795 plus VAT.