In our latest guest Blog, buying agent Henry Pryor warns sellers against overpricing their homes.
With any competition, for there to be winners there must be losers, and so it is with the housing market. That’s fine if you’re only interested in winners but if you ask about the losers, this can make you unpopular.
I haven’t always been a buying agent. For 22 years I sold homes, working for some of the smartest estate agents. During these years I talked the market up, suggesting that house prices and demand only ever increased.
Ever since I started buying houses for people in 2006 I have been aware that this is a one-sided view. For every seller there has to be a buyer and it isn’t in the buyer’s interests if property is getting more expensive. I discovered early on that people don’t like to hear that prices might be over-cooked. Estate agents did not want to imagine that the bull market might come to an end.
Yet it was clear that the market was overheating. Who thought that 110 per cent mortgages such as those given out by Northern Rock were sensible? Yet it was considered blasphemy to question it.
Since the credit crunch first hit in October 2007, asking prices have bounced back and are 44 per cent higher in London. However, average sale prices are only 14 per cent higher, even in Kensington and Chelsea, according to the Land Registry. In other parts of the UK prices have fallen considerably: in Wales, they are 30 per cent lower since the credit crunch. More than a million people have seen the typical 5 per cent equity that they put down when they bought their home wiped out. Lenders now prefer 25 per cent deposits, leaving these borrowers trapped.
Lately, I have been exposing sellers and agents who think they can ask too much for a house and that it won’t matter. Well, I have news for them. When looking on behalf of a buying client I sniff out homes that have got stuck and reduced in price. The problem is buyers often assume there is an issue if a property doesn’t sell quickly and give it a wide berth. Recently, this has enabled me to buy two properties at serious discounts to the original asking prices. I know about these properties because Google tracks your every move.
So, if you are planning to sell, don’t listen to the agent who thinks a high valuation will tempt you to list with him. Don’t think your house is worth what it might once have been. These days you leave a digital footprint when you market your home and there are folk like me who love buying properties at a discount. Caveat emptor? No, caveat seller.
The views expressed in this article are those of the author and not necessarily those of Anderson Harris