Four in ten London home sellers are cutting asking prices, the highest figure since 2010
- Credit: PA
Sellers have cut asking prices by an average of 6.7 per cent over the last month, according to new figures
More than four in ten London home sellers are cutting asking prices as the capital’s housing market continues to slump, according to a Rightmove report
Although the property website acknowledged this drop in new seller asking prices is the norm for homes in the run-up to Christmas, with falls recorded in six of the last seven years, this month’s figure is the highest since 2010.
The report found that sellers are cutting asking prices by an average 6.7 per cent, and that these cuts are being driven by “initial over-optimism and a tougher market.”
James Morton, director of north London estate agents Benham & Reeves also believes “soaring Stamp Duty and the uncertainty surrounding Brexit” are fuelling a buyer demand for lower asking prices, which forces sellers who need to make the sale quickly to reduce their asking price.
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“Motivated sellers, who either need to sell for personal reasons or have found their next property, are the most likely to reduce their asking price to encourage viewings and offers, because buyers are only prepared to commit to a purchase when they feel they are paying the correct price. The starting point for this price therefore needs to be enticing to attract buyers in the first place.”
A fall in asking prices is likely to continue into the New Year, according to James who said “at Benham & Reeves we feel 2018 will be more of the same. Until the Brexit negotiations give any clear indication of the impact on the financial services industry in the City of London, many buyers and sellers will continue to sit on their hands.”
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In north London and Hampstead specifically, the agent said: “A considerable volume of properties have values in excess of £1,000,000, so buyer demand for many of our clients has subsided. Only those properties correctly priced are the ones selling.”
“A drop in Stamp Duty in the Chancellors budget on November 22nd would certainly help to increase demand, and those buyers sitting on the fence may well make change their attitude and commit to buying if that is implemented. After all, the majority of people still see property as a good long term investment and most people would prefer to own their own home,” said James.