When To Drop House Price?

[BraOffPjsOn]

We’ve been on the market, which is completely dead around us, for almost 2 months. The estate agent called the other day to discuss dropping the price (from the price they’d estimated in the first place).
I don’t mind dropping it 10k but at the moment there is nothing we like and want to offer on anyway. Also, if dropping still doesn’t get us a buyer we wouldn’t be able to drop anymore and would just take the house off the market as we wouldn’t be able to get the kind of house we are selling for in the first place.

A friend of a friend, who’s an estate agent, said nothing is moving here at the moment and they’re not expecting it to get better until after Christmas!

Kind of wishing we’d waited until next spring now.

Any advice about what to do would be greatly appreciated.

Where is this?
There's not enough housing at all where I am. Every last Wendy House is snapped up - at outrageous prices.

We’re in the south east on the coast!
Things were crazy with covid and then since stamp duty changes it’s silent.
We were the same where things were snapped up immediately but I think what’s happened now is everyone has overpriced so much whatever their area and so now there’s nothing we want as it’s all too overpriced.

I wouldn't drop yet if I were you.

If the market is dead then 10K is unlikely to make much difference but also if there is nothing on right now that you would buy anyway there seems no point. Maybe wait until there are visible signs of improvement and/or if something comes on that you would go for, especially if you have little wiggle room in the price you accept.

The market where I am is dead also. Perfectly lovely houses stagnating on the market for months and months on end. It doesn't seem to be a good time to try and sell. It took 9 months to sell ours and it still hasn't gone through. In fact, we are no-where near. But it seems pointless to go back on the market, in a market where nothing is moving. So we are between a rock and a hard place.

I hope you get some interest soon. Its a difficult time to be a seller.

Thanks - I know the opinion on MN is that is you price low enough you’ll sell but then what does that leave to buy when everyone else has priced so, so high. The reducing kind of has to start from the top doesn’t it but I don’t know how likely that is!

I guess if we had to move or there was somewhere we loved then I’d feel like I knew what to do.

I hope your chain moves soon!

If you don't really need to move and you are upgrading to a more expensive house then I would take it off the market and wait. Prices are likley to fall between 10 and 20% imo. Probably within 12 months. Wait until that has worked through and you will be ultimately better off financially. As an example if your current house is worth 500k and loses 10% you sell at 450k. If your purchase is 1m and loses 10% you will pay 900k. So that's you at least 50k better off by waiting. I say at least because the more expensive house is likely to loose more than 10%. Imo.

2 months is not that long. I'd give it until November and if it's not sold take it off the market until spring with a revised price. Remember you only need one buyer.

If it’s a dead market, then the issue isn’t likely the price. I’d just take it off the market and wait until there’s more movement. Once you lower your price, you can’t easier raise it again.

How much is it on for? If it’s more than 150k then reducing by 10k is not going to make a difference.

If you reduce it, it would probably be better to reduce to the next Rightmove bracket. We reduced ours from 525k to 500k and then it became within reach of more people. If it’s on at 525k for example and you reduce to 515k, you’re not really attracting any different prospective buyers.

If 10k is the limit of what you want or can afford to reduce, I’d remove it and try later. We’re on the south coast too and the market is flat.

TBH, if you wish you had waited until next Spring then just see out your EA contract and give them notice to quit. Take a breath and then try again in Spring.

@DrySherry is right. A falling market is terrific for upsizers and FTB. If that's you then be optimistic. Not only will you save on the price of the next home but you'll pay less SDLT as well.

IN the meantime, educate yourself as much as you can. Watch the UK Weekly Property Market Stats show on YT. Read the RICs UK Residential Market Survey each month. And select your EA using the kind of information found in the Stats show end segment.

I agree with @DrySherry and @XVGN

I can't see much point in you dropping by 10k, unless your home is being marketed around the £100-150K mark.

When estate agents and sellers say 'the market is dead', it just means that everything is over priced relative to what potential buyers can afford and so very few people are making offers in that area and nothing is selling. I wonder on what basis your estate agent friend is expecting things to improve after Christmas. Does he/she just mean that Spring tends to be a better time to sell usually? It's true that there is more activity then so you could try marketing again around February and see what happens.
I agree that the market is likely to continue to fall in many areas but that this can be a positive thing for people looking to upsize once the penny drops with those further up the chain!

Thanks all for the advice. Ours is worth over 300k so 10k isn’t huge but would put us in the lower search band on rightmove!

A house has come on today which I love the look of. Lots of work needed of it but doable over time. But now I don’t know as dropping and then not getting that house would be lousy! Also how much do you drop to get sold? As low as you can so that you can still afford the house you’re hoping for although then if you don’t get that you’re stuck if something else comes up that’s higher! Or do you wait it out and how it’s quiet for the other house too!

I felt a moment of excitement and now still baffled!

Reducing by 10k on a house over 300k is going to be pointless. A drop of about 5% of the current asking price is the sort of amount that is likely to generate some new interest.

You could decrease your amount in the hope of getting that house and then if you don't get it, you always have the option of taking your house off the market at any point. You never have to accept a low offer but sometime it's worth it if you can then get the onward house you want at a lower price too.

Tricky situation as you now want a specific house. Still, if the market is generally 'dead' and everything is over priced, hopefully the other house will be available for some time too.
It's impossible to know re reductions. You could try 10% in the hope of stimulating a decent level of interest but it depends on how over priced it is currently. Hopefully you can negotiate a good deal on your next purchase.

When the market is the way it is at the moment, time to get creative.

Maybe tell the owners that you like their house, but can only afford the move
at 30K less. Then if they agree drop your own price 30K.

The problem with buying something dilapidated is that it is almost guaranteed the survey is going to turn up a load of (potentially) expensive issues.

10K will not make any difference. The summer is always the slowest time to sell.

1. do you have the right agent for the property?
2. have the details and pictures been written and taken to reflect the target audience?
3. is it correctly valued?

go view other similar properties, eg marketed at the same value, or a similar spec, with a variety of agents and take a view on where yours fits with these and also to get a feel for the agents that handle the whole process best. then decide what you do next.

"Prices are likley to fall between 10 and 20% imo. Probably within 12 months."

10% nominal in 12 months is an awful lot. What makes you think it's going to become just that bad?

Dry Sherry has always had a pessimistic outlook on house prices (if you consider it bad news if property prices fall). The next house price crash is always just around the corner (probably).

What we see instead is a stagnant market in most parts of the country.

Really buoyant market here after a couple of dead years.

We’ve had to drop by an enormous chunk to finally sell after nearly a year on the market. Lovely location, fabulous house. We went on below what the EA originally suggested because we wanted a quick sale, too. We noticed though that pretty much every other house in our bracket wasn’t moving either and didn’t until they came down in price by at least 10%. Why so many agents were getting values clearly very wrong a year ago is a mystery.

It's not a mystery. Over-valuing in Estate Agency is endemic. I posted a link to a video the other day where industry insiders discussed it.

We’ve sold 6 houses over nearly 40 years. First time the agent hasn’t got it within ballpark. We’ve sold for £115k less than original asking. Agent originally valued at £20k more but dropped by that because we wanted a quick sale!

If your house needs to drop to sell unless you are moving areas anything you want to buy will be dropping too

can’t really advise - it’s a bad time to sell and it’s quite possible house prices will stagnate or drop over the next few years which will keep the market sluggish

What are you basing that on? Sales have been steadily picking up over the past months, with interest rate cuts.

A £10k reduction is not going to drop the property into a different category of buyer.

If you can't afford to drop more than that then I would give it maybe until end of September and then take it off the market and try again next spring.

Round here, also south east, some houses sit in the market for months. Generally the ones I see and think ,'that seems expensive' The odd one is snapped up very quickly and they are the ones that are priced about right.

There also seems to be a complete disconnect between the condition of a house now, the work required to it and the asking price. Building work is soooo expensive but that doesn't seem to be factored in.

Over valuing is rife at present as @XVGN. I think it's because a lot of agents and sellers haven't realised or don't want to accept that the market is slowly falling in many areas, especially in the South and for more expensive properties. I expect prices to fall more, quite possibly a lot more so I think you were sensible to drop your price and make the sale,