How do people manage to sell (SW London, zone 4) 2 bed flats these days?

[FlatSeller]

We've put our 2 bed flat on the market in early March 2020, fast forward, May 2022 and we are still trying to sell. Dropped the price by over 10% from what we bought it for in 2017. Back in 2017, just after Brexit, we thought we would go for a small flat in a good location, keep it for 3-4 years as a stepping stone, then move up the ladder somewhere local.
Fast forward we are still stuck in it, no buyers, 1-2 viewings a month. It's in a great condition, has almost 100 years on lease, great location for commute to central London, good schools around, lots of parks, green space in walking distance, well kept purpose built block, lowish service charge, tiny ground rent. Changed agent 4 times in these years. Feedback we are getting is that the flat is smallish, kitchen is tiny, which is true, but not an unusual thing for London and that's not something we can change.
Shall we try an auction?
Hoping for some positive stories / selling strategies.
Thank you!

obviously the pandemic & remote working has pushed people out.

I would not buy anything with under 100 years on the lease either. Not because I would worry about it running out in my lifetime, but because it will be harder to sell in a few years time. Also harder for people to get a mortgage on properties with a short lease. If you can, pay to extend that now. Is there a way of opening up between the kitchen/living area? People tend to want more open plan, and a tiny kitchen does put many off as it's kind of isolating standing in there cooking. It's not selling a positive lifestyle of socialising etc.

Hi OP,

i received the link sent by PM. I think the overall feedback and feeling of the flat is that it’s a bit sad. It doesn’t look like anyone lives there, is that the case?

the bedroom with 2 beds in it looks particularly cold, the doors out to the balcony don’t make it look very attractive as a space, especially as the balcony itself looks quite dirty. Likewise the balcony on other pics looks like it has damp or similar on it?

I think you need to redress the place and get the photos redone. It needs to look like a proper, welcoming 2 bed flat with some decent staging so that people can visualise how they would live there.

at the moment, I’d feel like there was a lot of work doing to it. That plus the lease length would put me off. The kitchen size, while small, wouldn’t put me off for a 2 bed flat

Some mortgage providers won't give a mortgage on such a low lease, have you tried extending it? Even if they do it would put many buyers off too if they are thinking ahead to when they resell. Thats the main issue imo.

Then it would be the price but only a local estate agent would know what else locally, for similar specs, is selling for. Maybe get a couple round for a revaluation.

The other thing that I think is really difficult for you is that looking at the sale history I would suggest that you overpaid in 2017 for the property in comparison to others locally with a garden and bigger rooms. This now has a knock on effect for you when trying to sell now at your price point.

I know this doesn't help you, but I think you need to be realistic now if you really want to sell.

You need to do the maths by ruthlessly going through sold prices on RM so that you get a reality check. Maybe ask a friend or colleague to do it.

Presentation is only relevant if the fundamentals are appropriate - price, lease length etc.

The London flat market isn’t going to bounce back anytime soon given:

remote working
cost of living crisis
increase in mortgage rates
poor economic forecast

If you need to move on with your life in the next 5 years I would review the lease and price against the competition and get at least be comparable.

When I was selling my flat couple years ago, I only had about 80 years left on my lease. My buyers were cash but they and their solicitor would not go through with sale unless we paid for 1000 years. Luckily we owned a share of the freehold so was a lot cheaper but it is very costly to renew. As PPs said no mortgage company or buyers themselves will purchase with a 100 year or less lease.

My friend had her 1 bed, zone 3 SE london flat on the market and eventually threw in the towel- she didnt want to lower the cost to what she needed to to sell.
Sorry to say it- and anyone who experienced the 2009 slump knows this- property isnt guaranteed to make money! It will only be price- flats in London arent appealing post pandemic.

Get the lease extension underway already
That will make it more worthwhile

I'm not sure why people say it's hard to find a mortgage for leases with less than 100 years. I'm not sure any of the big players ask for this, most will lend on 70-75 years. As a buyer I'd be cautious of going below 90 years but really think some on here overstate the issue.

I wouldn’t even look at somewhere with less than about 120y. Your buyers will be thinking about what happens in 5y when they want to sell on. Extend the lease or drop the price.

The square footage is about average for a 1 bed but tiny for a 2 bed. I can only imagine that bedroom 2 is tiny - actually more of a study or box room than a bedroom? I think this is probably what is putting people off as in London people seem obsessed by square footage and will determine a properties value based largely on it. Unfortunately you probably need to lower the price to more what generous sized 1 beds are going for.

Agree - the length of the lease is not bad for a London flat

If you have name changed you may as well put the link up op

Agree hgaj. That is a good remaining lease.

55sqm is really small for a 2 bed, it must be an average double and a small single. If it's priced as a typical 2 bed, you maybe need to lower your expectations to around a top end 1 bed, plus a bit extra, in order to shift it.

starseeking <waves madly>

My experience is that's a pretty typical measurement for a 2 bed in London.

Hey EmmaH, I hope you and your mum are doing well.

I just looked quickly at the floor plans of a few 2 bedrooms near me. The smallest was 70sqm, and looked tiny, so I really can't imagine 55sqm

Last year I managed to sell a one bed flat we owned in London for 4% less than I paid for it in 2017 - still feeling very lucky we managed to sell!

Just to add it was around 50m2 for a one bed so I think size might be an issue here.

55sqm is small for a two bed. My London one bed is 50sqm.

I’ve managed to sell but only by pricing it extremely realistically.

Sorry 55sqm is tiny!

We have a holiday rental abroad, it’s just a small 2 bed, only suitable for holidays really due to lack of storage etc and it’s 65sqm.
That’s x2 large double bedrooms, shower room, one open plan kitchen/ dining/ living ( again kitchen very small, small 2 seater sofa). There’s a laundry cupboard with stacked washer and dryer, and space at the end of the hallway for a chair or desk. There’s also outdoor space.
We have lived there ourselves for several months with a baby and home office and it only worked as we had 90% belongings in storage ( and we live fairly minimal).

Another factor is a huge oversupply of 2 bed flats in the capital since they are profitable for new build developers but often unsuitable for families.

I agree, renewing a lease only becomes more expensive at 80 years or below. Only looking at this with 100 or more left is over cautious imo.

Only looking at this with 100 or more left is over cautious imo.

I disagree- I'm looking at London flats at the moment and really like to see 120+. Buyers aren't only thinking about themselves but about their future buyers, who will be thinking about the buyer after that, and so on. Obviously you could continue this indefinitely which would be ridiculous, but I like to be able to think at least 3 sales ahead without there being any issues around the lease. It's a buyer's markets for flats at the moment.

I agree also with PP saying that 55m is small for a 2 bed. It will suit some people eg a couple or single wanting to use one bedroom as an office but not others eg sharers. Obviously nothing to be done about the size so it has to be in the price.