New research has found that the pandemic property market boom is causing many home sellers to enter the market with a little too much enthusiasm when pricing their property, causing them to reduce their asking prices expectations by 20% or £75,000.
Research by HBB Solutions looked at those homes currently on the market who have chosen to drop their asking price expectations and by what margin they’ve chosen to do so.
The study found that across Britain, home sellers who are opting to drop their asking price are doing so by 19.8% on average, reducing from £380,637 to £305,353 – a reduction of £75,284.
The regions in which sellers are most frequently forced to reduce their asking price are the South East and London, where local reductions account for 24% and 14% respectively of all property asking price reductions across Britain.
At 10%, the North West is also home to some of the highest levels of homes that are repricing having already entered the market at a higher asking price.
However, it’s sellers in the North East that are being forced to apply the biggest asking price reductions, typically coming down by 20.5%, followed by the West Midlands (20.4%), Yorkshire & Humber (20.2%), and Wales (20.2%).
While London’s home sellers may be one of the most likely to reduce their asking price, they are only doing so by 19%, the most marginal reduction of all regions.
Managing Director of HBB Solutions, Chris Hodgkinson, commented:
“For quite some time now, we’ve seen report after report of how the housing market is booming and house prices are climbing to dizzying new heights. So it’s understandable that sellers entering the market may be doing so with a little too much enthusiasm when it comes to pricing their home.
The consequence? They’re finding that even in a sellers market, an overpriced home will always struggle to sell and the inevitable course of action required to secure a buyer is to lower their asking price expectations.
What we’re also almost certainly seeing is the first signs of a cooling market, as the economic pressure of rising inflation and the increasing costs associated with mortgage rates, in particular, start to dent home buyer confidence and the sums they are willing to pay.”
Data tables and sources can be viewed online, here.
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