Too soon to reduce price?

[Marshmon]

Hello,

First time seller here so after advice.

We put our house on the market 2 weeks ago. The asking price is roughly in line with similar properties in the area. Within a day we had an over asking price offer, which we accepted the estate agents then set the property to SSCT on Rightmove etc.

The buyers bank said they would only mortgage the house for 15k less than the asking price so the sale fell through.

So on Thursday the property when back as for sale on websites. But I’m worried we’ve missed those few days when we are top of the searches on right move. Since Thursday we’ve had no requests for viewings

Taking all this into account should we reduce the asking price or is it too soon?

How does your asking price compare to similar properties which have recently sold? How does it compare to similar properties currently on the market? How quickly do you need to sell? If one lender has valued your property at less than asking price, it’s possible another will as well, so if you don’t lower your price you may find yourself in the same situation over again.

Our asking price seems consistent with other properties in the area that have sold quickly. That’s why I was so suprised when the valuation came back lower.

Although the estate agent said he’s got 3 other properties where the same thing has happened. He thinks banks have got more risk adverse.

The same thing happening is something else that’s bothering me

Can you sell it for £15k less and try to negotiate on the house that your moving into?

Estate agent valuations / asking prices are generally quite ambitious: built into them is an expectation that most buyers will offer and most sellers accept something under asking price unless it’s a very competitive market. So if your buyer offers over what’s already considered to be an ambitious price, the more likely the bank will believe that to be too high a price for them to lend against, especially in uncertain times. The prices that similar properties have sold for - is that actual sale values, or just what they were listed at? If the latter, that isn’t necessarily what was paid.

I’d see what a week brings and then consider dropping maybe £10-15k, especially if your price falls outside of a broad bracket.

Two weeks, far too soon. I would wait at least four weeks. You're house will be monitored by potential buyers. I wouldn't want to appear to desperate and then attract low offers

Thanks for the advice. We are in a good position to wait because we already own the property we are moving into. I think I’ll give it another couple of weeks. But be prepared to accept something below asking

Are you comparing the listed prices of the other properties or the actual sold prices? They may have listed at a similar price but sold for much less. Valuers will look at sold prices not list prices.

If one lender downvalued, there is a risk that others might because they tend to use the same valuers. The banks are not the ones doing the valuation. They use a handful of firms.

If it’s been down valued and you don’t have very clear evidence it’s worth the asking price, you will struggle.

This happened to a house we tried to buy in September and it’s “sold” once since, gone back on the market at a slightly lower price and only just “sold” a third time this week.

If the vendor had negotiated with us, we’d have proceeded and they’d have moved by now.

I’ve done some research on sold prices in the area. We are selling a 2 bed

In the past few months;
A 3 bed in need of cosmetic work sold for £10k over our asking price

A similar property sold for 10k under our asking price

2 smaller, no hallway properties went for £20k and £25k under our asking price

A house in our road went for £18k under our asking price in may.

I think looking at that and reading round our best plan is to wait a couple of weeks then drop it by £10k

Good that you are looking at actual sold prices. That’s what the valuers will be looking at but with consideration of existing market info. You should also calculate the price per sq foot or sq meter and compare them.

We had our house for sale in September last year. After about five weeks we revamped the photos, added a couple, removed a couple, tweaked the description and DP started showing ppl round instead. Out of the next three viewings we had two offers, one £2.5k over and one £5k under

Can we see the advert?

evouk
Two weeks, far too soon. I would wait at least four weeks. You're house will be monitored by potential buyers. I wouldn't want to appear to desperate and then attract low offers

This exactly,

Why didn't you accept the original buyer if they were able to offer £15k under their first offer? You're going to have to drop asking by £10k anyway?

I suspect the market will have dropped since the other properties sold, buyers will now be missing out on the stamp duty reduction which was artificially inflating the market.

Having said that dropping the price too soon will not look good. I would keep as it but be flexible and open to offers. I assume your previous buyer would not negotiate?

Did you refuse to drop the price in line with the valuation? Is that why it fell through?

Are you still marketing it at above valuation? Because if so. Then until the market catches up with you the same thing is likely to happen again.

Can you go back to the first buyer? It depends on how quickly you want to sell but if it is valued at £15k less you might have the same problem with someone else

We did accept the original buyer because the house had only been on the market for 24 hours when they made there offer and then it was put to SSTC. So we felt that rather than drop 13% off the asking price after only a day on the market we’d put it back on and see what happened. I’ve been suprised that we’ve had so little interest since then. Only time will tell if that was a good decision or not.

The original people seems to be really flaky as well. First they said they’d offer £8k low asking (£10k below what they originally offered) then £10k then £15k. After the reducing what they could offer 3 times in about 48 hoursI didn’t have any confidence in them actually going through with the sale.

I’m hoping with parliament debating stamp duty on Monday that’ll get extended and it’ll get the market going again. But me and the estate agent have agreed to talk again week after next to discuss next steps, which I think will be to reduce the price