- The
average time to find a buyer for a Neath property reduced from 72 days in 2020
to 39 days in 2021.
- Yet
still, just under 1 in 3 Neath homeowners are on the market after 12 weeks.
- Why
are so many Neath homes still on the market after all that time, and what does
it mean for the Neath property market?
You would have needed to have been living in a cave since
the end of Lockdown No.1, not to realise the property market has been on fire
in Neath (and the UK as a whole) for the last 18/20 months.
It has been very much a seller’s market, especially in 2021.
Yet as we enter the second quarter of 2022, I have noticed a slight rebalancing
of the Neath property market, more towards buyers, something that is good news
for everyone (sellers and buyers) locally.
In 2020, it took on average 72 days from the average Neath
property appearing on the property portals (i.e. Rightmove, Zoopla etc.) to the
property going sold (STC).
Interesting when compared to the national average of 72 days
in 2020. Yet, last year, this was reduced to 39 days in Neath (51 days
nationally).
So, what’s the issue with the Neath property market being on
fire?
Well, that was last year, and things have changed slightly
since.
Of the properties for sale in Neath, 30.6% of houses have been on the market for more than 12 weeks.
That doesn’t sound a lot, yet that is an eternity in this
market!
So, why are there so many properties on the market in Neath
still for sale after all this time … it usually comes down to one thing … the
practice of ‘overvaluing’.
So before I explain what overvaluing is, let me give you some
background.
Many agents (not just ourselves), in 2021, were achieving top prices for
Neath property with multiple offers becoming the standard. The property they
were selling was only available to buy for days before the owner obtained multiple
offers that were not only at a satisfactory level, yet more than they ever dreamed
likely.
Although this was great news for Neath homeowners, this caused fewer
homes to come on to the market in the last six months in Neath, as people were
afraid to put their home on the market without having a property to buy.
With fewer properties coming onto the market, some estate agents have
become more and more desperate to get a larger slice of this smaller property
market. It has seen an unwelcome side of the estate agency profession, the estate
agency practice of ‘overvaluing’.
While ‘overvaluing’ is nothing new, the custom has been generally
limited to a small number of estate agents. Yet now, it’s become more prevalent
and creates uncountable distress and pressure for some Neath homeowners.
Many Neath homeowners want to sell quickly to get the property of their
dreams. Yet, in many cases, when they do put their property on to the market,
they don’t sell quickly enough because of this ‘overvaluing’ (even with the fantastic
current property market conditions).
To give you an idea of the issue …
55% of Neath homes put on the market in the last 30 days have not sold.
There are hundreds of Neath families having their dreams dashed by
‘overvaluing.’
Therefore, let me look at exactly what overvaluing is, why it’s on the
rise and most importantly, the harm overvaluing causes to homeowners like
yourself.
You would think the most important thing in estate agency is all about
finding the best buyer for your home, at the best price, who can make the move
with the least amount of hassle.
To us it is, and to many other Neath estate agents, it is as well. Yet,
to some agents, sales aren’t the essential objective. Instead, it is having a vigorous
catalogue of properties to sell to generate more future leads.
Deprived of an endless number of new properties for sale, the enquiries estate
agents receive will significantly drop, leaving them high and dry without any
buyer (or seller) leads, the lifeblood of estate agents.
Therefore, some (not all), but some estate agents will feed on a homeowner’s
appetite to get the highest possible price for their Neath home by giving them
an over-inflated suggested asking price to market their property at (i.e. ‘overvaluing’).
If one estate agent can get you an extra £30,000 for your Neath home, you will take it, won’t you?
The suggestion of pushing the
asking price of your Neath home for 10%, 15% even 20% could be seen by many as
a temptation too good to miss. Yet once you are on the market, the agent is
trained to slowly get you to reduce your asking price over a lengthy sole
agency agreement.
The problem is that the home of your dreams might have sold by the time
you reduced your price in 3 months. Also, Which reports in 2017 and 2019 proved
you ended up getting less for your home when it did eventually sell (which
means you lose money) and finally, the agents know homeowners perceive it’s a
hassle to swap agents (which it isn’t).
But estate agents only get paid when they sell the house; why do they overvalue?
Would it surprise you that some estate agency chains pay their staff a
commission when they put the property on to the market, not when it sells? So,
their team overinflate their suggested asking prices to get that commission.
Over the last 18 months, with the rising property market, there has
undoubtedly been a valid reason for pushing the envelope on the asking price.
Yet, if every house like yours is on the market or sold subject to contract at
£300,000 to £320,000, yours isn’t going to achieve £355,000, let alone £375,000
– even in this market.
With 55% of Neath homes still for sale after a month, the market is
starting to level out and if you are keen to sell, then let me give you some
advice.
Research has shown that if the asking price is
initially set too high, it will be ignored by people surfing Rightmove and
Zoopla.
(Come on, be honest – you have done that yourself haven’t
you?)
When the property is eventually reduced because it has the
stigma of being on the property market too long (begging the question from
potential buyers that there may be a problem with the property itself hence no
interest?), often when it does eventually sell, it will sell for less than what
it would have done if it were priced correctly from day one (as per the two
reports from Which in 2017 and 2019).
Of course, on the other hand, setting the asking price below
its market value means potentially leaving money on the table needlessly –
hence the need for a good agent.
Putting your Neath home or buy-to-let investment up for sale
at the right price from the beginning is the key to selling within the best
time frame and for the best price to a serious and motivated buyer.
Ask a handful of estate agents to value your home, ask them
to back up any valuation of your Neath home with cold hard comparables of
similar properties to yours.
Find your comparables by searching ALL the
property portals (i.e. Rightmove, Zoopla, Boomin, OnTheMarket).
If you only take away one thing from this article, when you
search the portals for comparables, make sure you include under offer/sold STC
properties, as that will triple the comparable evidence.
Thus, by doing your homework and then working with a dependable,
trustworthy and experienced Neath estate agent, who will help to ensure that your
Neath property is put on the market to get you, the homeowner, the best price
from day one without over cooking it so you don’t lose out, you will be just
fine.
These are my thoughts, let me know if you have any yourself.
