As a buying agent, someone who helps people to find, evaluate and to acquire property I often remind people that you make money when you buy, not when you sell. The best you can achieve when you sell is what a buyer will pay but when you are bidding for a property it’s you that controls how much you spend. If someone else wants to pay more or it’s not enough to tempt the vendor then you don’t get it but if your offer enables the seller to get on with their life, to buy the next home they have their eye on, refinance their business or to pay off their spouse then it’s amazing how often I see them accept less than they had first asked. If you pay £5,000 less then you are better placed if the market slips and of course it’s £5k extra if prices rise.
I often have to remind my selling agent colleagues that it is the buyer who decides what something is worth and it’s the sellers prerogative to decide if it’s enough.
The housing market rises and falls – usually over a seven year cycle and we appear to be at the top of the current wave with the prospect of falling prices for some in the months ahead. Prices in central London have fallen by as much as 10% year on year and what starts in the Capital often ripples out. It’s only in the South East where we have seen prices rocket since the Credit Crunch and it’s worth mentioning that prices in Northern Ireland are still 50% below the peak they reached a decade ago!
Eighteen months ago buyers for some properties were given an hour on a Saturday afternoon to look along with thirty other hopefuls and then asked to submit their ‘best and final’ offer by Monday lunchtime. Today we have less of a sellers market and in many cases a buyers market. With prices stagnating in many places and actually sliding others the worry is whether the home you want to buy today will be cheaper tomorrow.
Eighteen months ago buyers for some properties were given an hour on a Saturday afternoon to look along with thirty other hopefuls and then asked to submit their ‘best and final’ offer by Monday lunchtime. Today we have less of a sellers market and in many cases a buyers market. With prices stagnating in many places and actually sliding others the worry is whether the home you want to buy today will be cheaper tomorrow.
Prior to Christmas I was bidding 10% below asking price. Today, with the uncertainties ahead of us, the Election, the Budget that will follow, the continued fall out from Brexit and the fragile economy there are still major question marks over the direction of house prices and I am starting over 20% below the value twelve months ago! A well-prepared buyer really can haggle today and in my 28 year career I can’t recall a better time to bag yourself a bargain. According to the website rightmove.co.uk the average buyer is paying between 5-7% below the asking price but I think that if you are tough you can do better. My own average over the past two years is closer to 15%!
There are over 600,000 homes listed for sale today. Last month only 100,000 sold. Talk of a shortage of properties and of 11 buyers chasing every home is the sort of puff we expect from estate agents keen to give the impression that the market is still red hot. It isn’t and this is the year that many people I expect will lay down the foundations of their future property fortune.
If you are going shopping for a new home then my advice is to be prepared;- if you have a home to sell then get it on the market and find out what the market will pay for it. Speak to your favourite mortgage broker and ask Charcol for a mortgage offer in principal. Speak to a solicitor who will act for you in both your sale and purchase and finally when you find a suitable home ‘negotiate, negotiate, negotiate’.
Good hunting!