This November has seen both an increase in interest rates and the abolition of SDLT (Stamp Duty) for first time buyers up to £300,000. Certainly the nominal 0.25% interest rate increase is unlikely to cause most homebuyers a problem. However, this first rate rise in a decade might be regarded as a tipping point for further increases in the coming year and the market remains subdued. This is despite the apparent windfall for first time buyers, which will almost certainly turn out to be inflationary.
Although we remain busier than expected for the time of year, with some record prices being achieved, there is at atmosphere nationally that we are moving towards a buyers’ market. According to UK Finance, mortgage approvals for purchases are at their lowest for over a year and, according to Rightmove, some 37% of sellers are reducing their asking price (the highest percentage in five years) and new-to-market sellers are being overoptimistic in their pricing. In other words, sellers must price competitively if they are to achieve a respectable sale before the added complication of a further supply of stock hitting the market in the New Year and Spring 2018.
So now, more than ever, sellers should avoid their property becoming stale on the market by quoting a price that buyers will regard as exciting. They should also avoid the mistake of pricing high on the basis that buyers will “make a lower offer”. We employ excellent negotiators and consistently find that we are able to achieve our asking prices (and sometimes even exceed them), but if the asking price itself is too high then there won’t be enough buyers to prompt a sale. This is the type of balancing act that we as experienced estate agents (as opposed to the online alternative) deeply understand, and harness to our clients’ advantage.
Interested in the market? Curious about the current value of your property in context? Why not call your local branch for a confidential chat? You might be pleasantly surprised!
Neil Newstead, FARLA MNAEA MIRPM
Chief Executive Officer