Sellers coming to the market have dropped their initial price expectations in July by asking an average of £4,138 (-1.7%) less than sellers in the previous month, the first fall since January, according to Rightmove.
This is the largest drop Rightmove has recorded in July since 2008.
“Those keen to sell this summer have the challenging confluence of miserable viewing weather, the continuing credit-crunch plus a sporting distraction of Olympic proportions,” said Miles Shipside, director of Rightmove.
“Those who have been on the market for many months might consider the prospects of achieving a sale to be somewhat of an Olympian challenge given that actual sales completions are just half what they were five years ago. The weather might not be hot but in most parts of the country the competition to sell is. Those fit to buy this summer will be looking for a property that is prepared for sale better than the rest in terms of value and quality.
“There is evidence that quality remains in higher demand in spite of the downturn, and those keen to sell need to be clear on what it will take to make their property a compelling buy. This will be a difficult goal for some sellers given their circumstances and location but, with buyers even thinner on the ground this summer, you won’t get a second chance to make a first impression.”
The monthly average run-rate of properties coming to market is just under double the level of completed sales. Land Registry data for the last 12 complete months shows average sales completions running at 56,220 per month. Rightmove records a monthly average of new property listings over the same period of 102,121. It says that although there will be a degree of correction in this imbalance as unsuccessful sellers change their minds and withdraw from the market, average unsold stock levels remain “stubbornly high” at 75 per estate agency branch.
Stock levels have risen for five consecutive months as new seller numbers outstrip the number of properties sold or taken off the market. In the comparable 12 month period prior to the onset of the credit-crunch, average monthly new property supply (137,082) outstripped successful seller numbers (108,539) by just 25%.
“Even though the supply of new properties coming to market remains constrained compared to pre-credit-crunch levels, in all but the most stock-starved micro-markets seller levels substantially outnumber those of proceedable buyers,” said Shipside.
“Attracting the attention of those buyers is the first step on the road to a successful sale. The fact that we have not seen major price falls in the UK and that many areas are not awash with agents’ ‘For Sale’ boards may lead some sellers to be over-optimistic with their pricing, but it is vital that they are dispassionate and face up to what they have to do to get their property fit to sell. New seller numbers may be down some 30% on the period prior to credit-crunch, but the numbers achieving a successful sale are down by half and average unsold stock levels are creeping up. Sellers need to adjust, as this new world is the new norm.”
Research into buyer behaviour on the Rightmove website shows that potential buyers spend an average of just 2.7 seconds looking at a seller’s summary advert before deciding whether to take their interest further, or move on to look at other properties.
Shipside said: “As a seller your property advert has less than three seconds to make a positive impression with a potential buyer. With lots of property to look at, buyers tend to exclude rather than include, and once dismissed it is a challenge to regain a buyer’s attention. Your property advert needs to give them reason enough to travel to visit your property, especially during one of the wettest summers on record. Given the level of competition for proceedable buyers in many markets, making an immediate and impactful impression is more important than ever, and this means finding the perfect combination of attractive price, compelling photographs and alluring description.
“Sellers already on the market, and those considering selling, should gather market intelligence on those properties they are in competition with and make an impartial judgement on why a buyer should view their property and why they would prefer to live there.”