The global credit crunch has been the number one discussion on many real estate related forums in the last few months. People are worried and when we look at figures, we can quickly see why. According to a report by Rightmove, a British property portal, the ratio of sellers to buyers of real estate in the month of May 2008 was a dismal 15 to 1.
This is certainly not a very encouraging thought for those home owners who absolutely need to sell due to finance problems.
The article also stated a record unsold properties for every real estate agent in the country of England. This oversupply of stock has forced many home owners to reduce their property sales price by some £3,000. The current value of an average house is £239,564, reflecting a total fall of 1.2 percent.
With June normally being the peak selling season, this doesn’t paint a pretty picture. The last recorded low was back in June 2005 with a 0.2 percentage fall.
Miles Shipside, Rightmove’s commercial said: “In spite of the lowest housing
transactions for 30 years, new sellers had been coming to the market asking record prices. It was a mad state of affairs that defied the laws of economics. Thankfully, new sellers are now taking some proactive steps to price more realistically from the outset to attract increasingly hard-pressed buyers.”
He also urges sellers to utilize current technologies and all means possible to help them stand out from their competition for higher chances of selling success.
The report also accredits the widening gap between some sellers asking prices and the buyers affordability and willingness to pay as one of the factors behind the slow volume of sales.
The ever increasing cost of living is slowly starting to overrule people’s means of living which adds to the problem of an oversupplied property market.
With a supply of over 1 million properties in the country, sellers will need to prepare themselves to lower their asking prices even more if they hope to stay competitive. This could reflect in a reduction of 10%.
The lack of mortgage availability plus the spiraling mortgage rates give sellers more cause for concern as the market of able buyers is severely limited.
Shipeside further stated; one way to move in the right direction for sellers would be to focus on the 3 P’s.
- Price
- Presentation
- Promotion
Pricing below the competition, the best and most attractive presentation in the street, plus a killer promoting strategy are all essentials in the current market.
Market Overview In Graphs
Rightmove’s Monthly Sales Price Trend:
National Asking Price Trend
National Asking Price Trend By Property Type
