If you live in the UK when is the best time to reduce the price of your house
When should you reduce the price of your house is a conundrum you may be facing. You are not alone as this is faced by many home owners when houses don’t sell.
When should you reduce the price of your house?
- If your home has been on the market for a long time.
- You’ve not had viewings.
- Feedback suggests a reduction.
- Get a second opinion on value.
- Considering your house’s true potential.
- Ask your estate agent why it hasn’t sold.
- When you’ve had an open house.
- Consider the time of year.
- Market conditions.
But before I consider when to reduce the price of your house, let’s take a look at why your house may not be selling in the first place.
What to consider if your house is not selling before considering lowering the price of your house?
1. How long has your property been on the market for?
If your property has only just been listed, don’t even consider a price reduction. Speak with your estate agent and ask them how long it is taking to sell in the current market.
But it’s important to understand that the longer your home is on the market, the lower your odds are of selling it for the price its listed for. The further away you get from the day your home was listed for sale, the less your chances are of achieving list price.
This is why it’s crucial to get the valuation right at the outset. Estate agents who over-value houses to get the listing will seriously damage your chances of selling your house in good time.
But you need to at least wait a couple of weeks before you begin to worry. But this leads onto the next point; Which is have you had any viewings?
2. Have you had any viewings from potential buyers yet?
The average time it takes to sell a house depends on the market conditions and time of year. But whatever time of year or condition of the housing market, it’s important you are getting viewings.
If you’ve had no viewings at all, you need to be speaking with your estate agent. Ask them why they think you are not getting the intertest. They may tell you that it’s the price, but equally, it may be the condition your home is in, which will be reflected in the photos the agent took.
If your how presented in the best possible way. First impressions are so important. Review other similar properties for sale on Rightmove in the same price bracket. Look at how these other properties look compared to your images.
You need to have decorated your home in neutral colours. The outside of the house should also be giving the best impression. If your house is looking tired, this will come across in the photos. If the internal decoration is garish this will come across in the photos and put many buyers off.
But if you’ve considered all of the above and your house is as good as the next similar house, you may need to consider a price reduction or changing estate agent if you’ve had no viewings at all after two weeks.
3. What feedback have you had from the agents for the viewings you’ve had of your home?
If you’ve already had viewings, but had no offers, you need get feedback from your estate agent. Ask for honest feedback about what these potential buyers are saying. Don’t get offended if they say bad things about your home, especially if the comments are consistent.
Use these comments to make the necessary changes. If for example, you get feedback saying the kitchen is looking tired. You need to take this comment on board. Your options if this is the case is to replace the kitchen or reduce your asking price accordingly.
But it’s worth remembering that kitchens sell houses. So if you you can afford to upgrade your kitchen, you’d have a much better chance of selling.
4. How many estate agents did you have to value your house in the first place?
When you first list your house its important to ask at least two, if not three estate agents around to value your home. By doing so, you get a feel for the market and what agents in the area are saying.
Don’t necessarily go for the highest valuation, as this may be a ploy on behalf of the agent to get your listing.
Some agents value high to make property owners feel good about their property. After they have the listing and the property isn’t selling, they suggest a price reduction a few weeks into the contract. Be careful you didn’t fall into this trap.
If you think this may be the problem you may have no alternative than to reduce the asking price right away, as it was listed too high in the first place.
Take a close look at the contract with the agent to see if you can get out of it. Unfortunately, you may have to let the contract run its term before changing agents.
5. Are you showing your house off to is true potential?
As already mentioned, you should be listening to feedback from potential buyers and what they are saying about your property after viewings. Step back and look at how your house looks to others.
Ideally before you put your house on the market to sell you should do any work that’s needed. For example, make sure the kitchen and bathroom are up to date and look modern and clean.
Kitchens and bathrooms sell houses, especially if these are done to a reasonable standard and in a style that is modern and up to date.
First impressions count and sometimes people are put off by the slightest thing. People get a ‘feel‘ for a house. It that feeling isn’t there, you won’t sell it.
6. Have you spoken to your estate agent as to why your home isn’t selling?
If your house is not selling, have a frank discussion with your estate agent about why they think this is the case.
There are many reasons why a house doesn’t sell, and if anyone should know it’s your estate agent. Discuss the price with your agent. If the agent suggests it’s down to the asking price, ask them why they valued it at this level in the first place.
7. Have you considered having an open house to sell your home?
Open house sales are a good way to create a lot of interest and competition. If you have a number of people looking around your house at the same time, it creates a mindset in people that it is clearly a popular house.
Sometimes an open house can lead to multiple offers. This in itself can also lead to pushing the price up, rather than you having to reduce the price down.
8. Is it the best time of year to be selling your house in the first place?
There are times when it’s better to sell vs when it’s not as good to sell your home. For example, it’s well known that a good time to sell is over the Easter period.
For example, it’s never a good time to list your house to sell leading up to Christmas. Not many people are in the market to buy houses at this time of year.
If you have listed it at this time of year or a few months before and it hasn’t sold, consider taking it off the market to re-list it in the new year.
9. Is it a buyers market which means your house may be over-priced?
Depending on the type of market you are selling your house in, will affect how long your property will take to sell. Speak to your estate agent and ask them what type of housing market it is right now.
If it’s a buyers market, expect it to take longer to sell. Also expect to have to do deals with buyers who are more likely to be making cheeky offers in a buyer’s market.
However, on a positive note; if you are moving to buying another house you’ll be in the same position with the person you are buying from. But you may be better to sell and rent before buying again, which is certainly the case if house prices are falling.
10. Are there other market forces affecting the housing market?
There are often market forces that will affect how long your property will remain on the market. Ask your estate agent to find the average time it’s taking to sell houses in the current market. This will be a good indicator of how long it might take to sell your home.
However, there are other market forces that will affect buyers sentiment. Things like Brexit or if there are any wars going on around the world. Or perhaps the worry that interest rates may rise.
Looking more locally, are there any fears of business closures going on. As I write this article there are two in the headlines. This includes the Ford factory closure announcement for Bridgend, Wales. Here there are some 1,700 jobs to be lost.
There’s also the potential liquidation of British Steel. With this business closure there are around 5,000 jobs at the Scunthorpe plant in North Lincolnshire are at risk.
With both of these business failures, it’s not just the immediate employment losses. It’s also the supply chain of businesses that will be affected too.
It’s been estimated that there are some 20,000 jobs at risk if the British Steel plant closes. When there’s a fear of job losses, people are less inclined to commit to new mortgages.
Reasons why your house won’t sell
The number one reason why houses don’t sell is the asking price is too high in the first place. If the price is right for the location, size and condition of the property it should sell.
Many home owners make the mistake of over valuation their home. Thinking that they can get more for their property is a mistake. It’s a mistake you could get penalised for.
When I say penalised, what can happen is when a property is listed at too high a valuation, it remains on the market for too long. What often follows is any potential buyers worry about why your property isn’t selling. They may then avoid viewing it altogether.
There are many other reasons why your house may not be selling. These other reasons include not presenting it in the right way. First impressions are important.
Make sure you do any decoration (both inside and out) before it’s put on the market. Make sure the kitchen and bathroom(s) are done to a good and modern standard. Plus make sure the house is kept clean, tidy and free from smells like pet smells.
Also, make sure that rooms are presented as the room they should be. For example, don’t present cluttered bedrooms used as storage. This makes it difficult for buyers to imagine the room as a bedroom. Make it easy for your buyers.
The top 7 reasons why houses don’t sell – a must read for anyone selling their home.
Please don’t forget to read this before you leave…
Please don’t forget to also read this article to discover how you could save £71,475 on your next mortgage if you sell your house and rent before buying again. As I said earlier, even I was amazed when I did the calculations!
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