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Price Reductions???!!!

21st August, 2012
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It was only back in June that amongst others, BBC news ran the story that for the third consecutive month house asking prices had increased.
At the time, Elite Property Search responded through social media channels that in contrast to the height of the property market in 2006/07 where asking prices were based on fact, (that is actual achieved sales), this latest approach to stimulating the market was based on nothing more than conjecture and did not reflect the actual state of the market, because you can ask what you want for a property it doesn’t necessarily mean it is worth it or more importantly that someone will pay the asking price for it.
Our response was based on our experience of representing buyers and knowing their psychology, that is, in today’s market place they won’t buy if they think they are paying more than its intrinsic value and they need to feel as though they are getting a deal. Therefore, increasing house prices based purely on the argument that there was lack of stock against demand just didn’t stack up or achieve sales.
Our advice to sellers was price realistically, otherwise run the risk of your property not receiving offers and being left on the market gaining shelf life which in itself will de-value your property over time as well as increasing stress levels for the seller having a property that they cannot shift.
This week, the Telegraph ran an article reporting that Zooplas latest research showed property price reductions were at a 9 month high.
No doubt many of these will be sellers who overpriced their home on the advice of an agent, or on their own inclination to get as much as possible or in the belief that their property was “the best” and worth more than other comparable properties.
So what now? – well although they will have been told by reducing the price it will generate more interest from buyers and therefore increase the chance of the price offered being close to the original asking price, the truth in the majority of cases is that buyers will see a seller who reduces their price as one who is pressured or desperate to sell. Therefore, buyers will expect to achieve a price and will submit offers, way below the revised asking price.
Sellers, if they want to sell will have to engage with these buyers but this will in most cases lead to the achieved sale price being less than it would have been had the original marketed price been fair and reasonable.
If you are bringing your home to market this September/October do consider this lesson, because if handled correctly it is possible to achieve a good price and a quick sale for your home.
For access to pre-screened and proceedable buyers contact Elite Property Search 

London Office: Max Storey tel: +44 (0) 207 060 2338

Central Office: Andrew Findley tel: +44 (0) 1865 479980

South East Office: Tim Sharp tel: +44 (0) 1483 256775

South West Office: Joe Nisbet tel: +44 (0) 1202 766566

email: info@elitepropertysearch.com

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About the Author
Tim Sharp
Tim Sharp is a director at Elite Property Search
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