In the UK housing market, the offer price is increasingly just a starting point for negotiations. Properties for which deals were concluded between July and September were sold for an average of 90.6% of the initially announced value, according to Knight Frank data.
A home offered for £300,000 is selling for an average of £271,800. For a property with a starting price of £500,000, the agreed value would be around £453,000.
The reason is a combination of higher mortgage costs, a large number of properties on the market and sellers starting with too high expectations. The difference compared to 2022 is significant. Between July and September of that year, homes sold for an average of 100% of the original asking price.
Discounts reach 26%
The biggest room for negotiation is in small apartments, new builds and former rented properties. Here, sellers often reduce the price significantly to attract a real buyer.
“We recently achieved a 26% discount on a house in southwest London“, says Jo Eccles, founder and managing director of property buying agency Eccord. According to her, the property was listed at too high a price and remained on the market for too long, which put the seller in a weaker position.
Eccles warns that a discount from the asking price does not always mean buying below market value. In some cases, sellers are trying to recover the amount they paid, the transaction costs and the investment in the renovation. In others, agencies advertise the property more expensively to win the client, and then encourage him to accept a more realistic price.
Luxury properties are the hardest to sell
The pressure is strongest in the high price segment. According to data from TwentyCi, homes worth £2 million and more are sold half as often as properties below this threshold, wait twice as long for a buyer and are sold at an average discount of almost £250,000.
In London, fewer than four in 10 homes listed found a buyer during the period under review. In the £1m+ area, there were 3.6 properties listed for sale per sale, but only 28% of those sold were sold. For every 100 properties sold, 62 were taken off the market.
“Sellers are often faced with a difficult choice - to either take the property off the market or to slash the price,” says Jonathan Hopper of Garrington Property Finders.
How buyers negotiate a lower price
According to Hopper, the asking price is “the seller's desire and starting point for negotiations”, not necessarily the real value of the property. Buyers should check the prices of similar properties and local demand, rather than relying solely on national averages.
Especially important are signs that the seller is in a hurry or has already rejected offers. If there have been no serious offers for a long time, the possibility of a larger discount is higher. However, the buyer must be ready to prove that he can close the deal before negotiations begin.
Detailed statistics on average property prices in Bulgaria by city and neighborhood can be found at imot.bg