With house prices experiencing their first annual drop in over a decade, experts have pinpointed London as the area where the value of properties will fall furthest.
Last week, the ONS revealed the average cost of a property in the UK was £291,000 in September, representing a 0.1% year drop. This is the first time this has happened since April 2012, 11 years ago, and experts predict further decreases next year.
Speaking to the Daily Express, James Needham, director of investment company Alesco, said that moving forward, “it's likely” the market will experience a “continued stagnation” in expensive markets, such as London.
“This is largely influenced by mortgage rates, compelling buyers to scale back their budgets. On the flip side, regional markets are anticipated to experience a gradual increase, fuelled by improved affordability,” he told reporters from the newspaper.
To counter the price rises, Needham said buyers are now looking at more affordable options, with some looking further afield to bring down the cost. Regardless, the property guru still expects prices in London to fall.
"We expect the South West, South East, and London to bear the brunt, given their already high property prices.
“Areas with elevated property values are likely to feel the impact as mortgage rates reduce affordability. While we don't expect a massive price drop, we foresee a slowdown in the market with fewer transactions.
“Buyers and sellers are adjusting their expectations accordingly. The asking price and sold price are likely to get closer as sellers need to make moves in this changing landscape,” he added.
Navigating A Challenging Market
If you’re selling a property or you’re looking to put your home up for sale soon, there’s no denying the market has changed recently. But with prices set to fall even more next year, this could still be a great time to sell.
In a buyer’s market, which is what we’re experiencing at the moment, those making the purchase usually have the upper hand. However, if you’re selling, there are some steps you can take to help you secure the sale you're looking for.
The most important part of selling a home, especially in a buyer’s market, is pricing. If the price of properties are falling, it’s imperative that you don’t set an asking price that’s too high or you’ll run the risk of scaring away prospective buyers.
At the same time you want to avoid undervaluing your home as it could lead to serious financial losses, so it’s crucial to set a fair and reasonable asking price..
Likewise, be prepared for negotiations and understand that buyers may seek favourable terms. This doesn’t mean you need to bend over backwards to accommodate their every wish, but being flexible could really help you secure your sale.
Lastly, if you have any repairs or maintenance that needs addressing, now is the time to get this fixed up. Damage or disrepair could put potential buyers right off, whereas a property that’s clearly well cared for is much more likely to sell.
Seek Professional Guidance
These challenging market conditions merely highlight the importance of having an experienced and reputable estate agents who can help you navigate the choppy waters.
Working with an experienced estate agent who knows your property’s value and understands the current market can make all the difference when it comes to selling your home.
A good estate agent can provide data-driven insights, offer guidance on pricing and negotiation, as well as handling all the complexities of the selling process. This can remove much of the time and stress of the selling process, and by helping you achieve a fair valuation for your property, you could even save a substantial amount of money, too!
So with all signs pointing to prices falling in the capital and rest of the south east in 2024, if you’re looking to sell your home then now might be the ideal time!