It’s not often that I stick up for them, but Estate Agents are taking the brunt of the blame right now as buyers retreat due to concerns over property prices and mortgage rates. Vendors are still reluctant to move on price, creating a disparity between vendors and buyers in the UK property market.
This is the tone from property agents all around the UK with the exception of Cornwall (which is currently enjoying it’s own hiatus against the trend). The problem elsewhere is that more properties are coming on the market, especially in London. A colleague of mine based in London was lucky if he could get more than 5 properties listed at the beginning of the year. Now, all of a sudden, he has 42 new property instructions this month alone. More than the same period in 2022.
The consensus from vendor to vendor is the same, offload and downsize for a cheaper mortgage or cheaper running costs. Spring market is typically meant to be a good time of year, but all of a sudden it has estate agents concerned.
In another more affluent area of London, another colleague of mine reports that he’s had more landlords/investors contact him this month to offload their property portfolio than he has had in the last 6 months. The affordability squeeze impacting large property investors at the top level perhaps, or a smart move of “get out before it’s too late”, but is it already too late to sell for profit?
Unless something changes, such as the introduction of further market boosting measures/incentives for buyers, we can expect a familiar downward pattern emerging.
The expected downward pattern for 2023:
1. Vendors switching from agent to agent, blaming the agent’s poor performance for lack of interest/viewings rather than the market conditions.
2. Meanwhile, more properties being listed for sale as the affordability crisis continues.
This inevitably means that property prices will need to come down and vendors will need to be competitive NOW in the Spring market.
It is really striking right now just how many property owners are ignoring market conditions, but it will be the vendors who will suffer if they don’t listen to the agents being honest about price. Even when priced competitively, don’t expect an overload of activity or interest and always consider offers. It’s better to breakeven on a move now than to have an overpriced property fall through later on.
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Author: Ben, Glow (CeMAP, BSc Hons)
First Published: 28th April 2023