To reduce or not to reduce? That is the question

What is the property market like now post the latest Bank Of England base rate increase?

As you can imagine, after the recent increase to 5% and the expected impact on mortgage lending, the above is a question I get asked a lot right now, particulalry from those with a property currently on the market trying to find a buyer.

There is a lot of media coverage on the UK property market regarding sellers having to drop their prices to get sold but I wanted to give Harborne and Edgbaston homeowners a realistic picture of what is actually happening in real time. I am going to be specifically looking at the areas of Harborne (B17) and Edgbaston (B15) and Halesowen (B62 and B63).

37.43% of properties that are currently for sale in the above areas have had a price change compared to the UK average of 41% as you can see from the pie chart below.

I have started to see over recent weeks, homeowners (via Estate Agents) reducing their asking price within two to three weeks of being available. Advised to? panicking? ...or maybe comparing too much to the peak of property activity of 2021 and partiiculalry mid 2022.

My view is to price correctly, hold your nerve and give the property the opportunity.......According to recent data from Rightmove, you are 10% less likely to sell your property if the asking price has been reduced compared to those that don’t, based on their latest stats!

This data coupled with the fact that 37.43% of Birmingham properties that are currently for sale with a price reduction means they have reduced their chances compared to if they had priced more competitively from the start. Not only is it suggested that properties reduced in price are less likely to sell, if they do have a sale agreed, it will take over the double the time of properties that have not had a price reduction.

So is initial market price the key?

As recent as May 2023, 42% of sellers sold their home in the first 30 days of marketing, and this goes to show if you do price and market your home correctly in this current market, there is still demand from buyers even with the consistent interest rate rises. 

In conclusion, it is vitally important to choose the right estate agent to sell your Harborne and Edgbaston home right now, who will give you realistic advice to get you sold and moved as opposed to just sitting on the market having the condundrum of reducing the price.

Feel free to reach out on 0121 5170251, 07751675267 or andy@mchugohomes.co.uk for the pricing strategy that will help you and your home move.

Andy McHugo