The pandemic property market boom is causing many homesellers to enter the market with a little too much enthusiasm when pricing their property, and market analysis by property purchasing specialist, HBB Solutions, found that this has caused them to reduce their asking price expectations by as much as 20%, or £75,000.
HBB Solutions looked at those homes currently on the market who have opted to drop their asking price expectations and by what margin they’ve chosen to do so.
Disappointed, but not surprised
Across Britain, the research shows that homesellers who are choosing to drop their asking price are doing so by 19.8% on average, reducing from £380,637 to £305,353 – a £75,284 reduction.
The regions where 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 spanning Britain.
Yet, it’s the sellers in the North East that are being forced to apply the most significant 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 homesellers may be one of the most likely to reduce their asking price, they are only doing so by 19%, which is 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.”
Hodgkinson concluded: “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.”
| Table shows the average reduction for properties in Britain that have had their asking price reduced, and how the resulting price compares to non-reduced comparable properties in the same region. | ||||||
| Location | Proportion % |
Ave Price now – price reduced |
Ave % reduced by |
Ave Price – before reduction |
||
| South East | 24% | £348,808 | 19.4% | £432,852 | ||
| London | 14% | £686,407 | 19.0% | £847,226 | ||
| North West | 10% | £168,715 | 20.1% | £211,182 | ||
| East of England | 9% | £298,284 | 19.7% | £371,258 | ||
| South West | 9% | £307,343 | 20.0% | £384,050 | ||
|
Yorkshire and the Humber |
8% | £146,341 | 20.2% | £183,275 | ||
| West Midlands region | 6% | £207,286 | 20.4% | £260,303 | ||
| East Midlands | 6% | £197,018 | 20.0% | £246,406 | ||
| North East | 5% | £110,874 | 20.5% | £139,424 | ||
| Wales | 5% | £177,870 | 20.2% | £222,975 | ||
| Scotland | 2% | £119,122 | 20.1% | £149,146 | ||
| Great Britain | 100.0% | £305,353 | 19.8% | £380,637 | ||
Fixed mortgage rates fall across the spectrum