UK home sellers have to cut the asking price by an average of £14,000 | Real-estate market

UK home sellers have to cut an average of £14,000 off the original asking price as the market continues to cool, data shows.

Property website Zoopla also said that in the face of weaker demand, more than 40% of the homes it had currently listed for sale had an asking price that had been lowered to attract “price-sensitive” buyers.

However, a separate investigation from Halifax on Tuesday highlighted the sizeable home-price gains made by millions of homeowners over the past three years, and how the largest homeowners have been the big winners in the “race for space” fueled by the pandemic, while London flats owners have gained the least.

According to the latest data from Nationwide, UK house prices have fallen for four months in a row, while rival Halifax said they were flat in January but fell in each of the previous four months.

Zoopla said demand from homebuyers had “rebounded” in the first two months of this year after last September’s disastrous mini-budget wreaked havoc on financial markets, but remained at half the level of last September. a year as buyers remained cautious.

The supply of homes for sale is also improving: The website said the average realtor’s office had 24 homes for sale compared with 15 a year ago, giving homebuyers more choice, who now have more space to negotiate the price, and helps to reduce the upward pressure on real estate values.

As a result, sellers had to accept an average discount of 4.5% off the asking price to win a sale, the highest in five years, Zoopla said. In London and the South East, the figure is more than 5.5%.

The average discount to the asking price was £14,100, but the website estimated that a typical The UK house had an extra £42,000 in value during the coronavirus pandemic, suggesting that sellers are losing, on average, only a third of this gain.

Richard Donnell, CEO of the site, said: “Discounts on the asking price have been extended and while discounts of 4-5% are manageable, if they were to be extended further, this would indicate a greater likelihood of larger drops in price.” housing prices”. However, he added that he believed the market “remains on track for a soft landing in 2023, with modest price declines of up to 5%.”

The Halifax data showed that the median UK house price increased by 20.4%, or £48,620, between January 2020 and December 2022, from £237,895 to £286,515.

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Over the previous three years, from January 2017 to December 2019, it grew by 7.8%, or £17,158.

Based on 2020-22 data, the median price of the largest homes grew nearly double that of the smallest properties. When the UK property market first reopened after months of Covid lockdown, there was a surge in demand for larger houses as buyers sought more space, a garden or better work-from-home environments.

As a result, the median price of a single-family home shot up 25.9% between the beginning of 2020 and the end of 2022.

By contrast, demand for smaller properties in more urban areas fell during the pandemic. At the UK level, the typical cost of a flat increased by 13.3% over the same period. However, the impact of the race for space was particularly acute in London, where the average price of a flat grew by just 3.8%, or just under £10,000, over the three years.

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