Reality Check: Selling in a slowing market
What do the latest housing market reports mean for people considering moving?
The latest report from Rightmove states house prices increases in October are the smallest in 15 years at just 0.5%. Average increases are usually around 1.4% at this time of year. Other key findings in the report include annual property prices are down 0.8%, however buyer numbers are still up 8% compared to 2019.
Tim Bannister, Rightmove’s Director of Property Science, says: “While this year’s much more subdued rise indicates that some new sellers are gradually heeding their agents’ advice to price competitively, agents report that other sellers still need to adjust their expectations on the price that they are likely to achieve in the current post-pandemic, lower-activity market.”
What to do if you are thinking of selling
Rightmove’s report is based on asking prices, not selling prices. Pricing competitively Is essential to generate interest in the current market. We often market properties with a ‘guide price’, this allows for a level of flexibility. It means we can generate more interest in a property, with more room for negotiation when offers are made.
Now, more than ever it is important to choose your estate agent carefully. The myth of ‘all agents are the same’ has never been further from the truth. In this changing market we are seeing concerning tactics from other agents to ensure they still win business. It is common for agents to lock homeowners into fixed term contracts, however we are hearing some agents are making these as long as 6 months. Some agents are also imposing penalties of up to £500 to exit the contract early, even if the agent is delivering a dissatisfactory service.
This practice only serves to benefit the individual employee as they often receive commission based on the number of new properties they take on. For the homeowner locked into a long contract, if they are motivated to sell they are left with no other option but to drop the price when there is no interest. Our internal research suggests that 86% of properties that have gone on the market with another agent at a higher price, haven’t sold (Sandersons UK 07.23-10.23)
We strongly suggest anyone looking to sell at the moment studies any paperwork carefully. Agents that operate in this way aren’t usually forthcoming about this information, so it is important to question anything that seems unusual.
Regardless of what agent a seller chooses, we just want them to be aware of these tactics. For sellers that do choose Sandersons UK, they can do so knowing that we don’t lock our clients into fixed term contracts. If they are ever unhappy with our service, or want to take their property off of the market, they are free to do so at any time.
