Best places to bag a property bargain? Asking prices are being cut by 20% in some areas

In the south east of England, asking prices are being cut as house sellers struggle to find a buyer.

Eight out of 10 places in Britain that have seen price cuts of 5 percent or more are in the South East, according to data shared exclusively with This is Money by property website Zoopla.

Thanet in Kent, which includes the city of Margate, has seen more than one in five of all current property listings have their asking price reduced by 5 percent or more in the past 90 days.

In Dover, Brighton and Hove and Surrey Heath, almost one in five available offers have also been reduced in price by at least 5 per cent in the last 90 days.

According to Zoopla, a total of 11.8 percent of homes in Britain have reduced in price by 5 percent or more in the past 90 days.

Over the previous five years, the share of homes that saw a price reduction in the same 90-day period was just 6.9 percent.

Rightmove also reports that the asking price of more than a third of homes for sale has been reduced, the highest level since January 2011.

It said the average house for sale has had a price drop of 6.2 per cent, or a reduction of £22,700.

Zoopla says many more home sellers are cutting their asking prices by 5 percent or less, with some concerned that bigger cuts could impact what they can buy next.

However, more severe price cuts of 5 percent or more appear to indicate that more and more sellers, especially in the Southeast, are becoming increasingly desperate to attract buyer interest.

Izabella Lubowiecka, property researcher at Zoopla, says: ‘Asking price reductions show greater realism from sellers on prices.

“Many sellers are seeing that pandemic property value increases provide them with a cushion they can use to unlock sales.

‘Serious sellers looking to sell soon should have an honest conversation with an estate agent to ensure the property they are selling is priced at the right level for the current market.

‘Asking price adjustments happen across the board. Being a downsizer or an upsizer means that price revisions will not only affect the property you are selling, but potentially the property you want to buy next.”

Is the real estate market ripe for bargain hunting?

Whether or not the market is ripe for bargain hunting will clearly depend on what happens to house prices.

It will vary from market to market, but there may be greater opportunities to bargain and negotiate below asking price.

Charlie Lamdin, founder of real estate company BestAgent, says anyone looking to buy right now should aim high and bid low.

“When the market is declining, you should look at homes for which the asking price is outside your budget,” says Lamdin.

“Agents are quieter now and more willing to show you houses that they were too busy to show you a year ago.

‘Motivated sellers look for certainty of sales above the maximum price. This offers great opportunities for well-prepared buyers, especially if they are chain-free.”

Chris Sykes, associate director at mortgage broker Private Finance, says he has noticed more offers being accepted for high-end properties at significant discounts.

He said: ‘In recent weeks we have seen signs of a revival in demand for high-quality properties from high-net-worth individuals and individuals with substantial incomes.

‘These properties, which have recently had bids accepted, have typically been on the market for some time and are now selling at approximately 10 per cent off the original asking price.’

However, Henry Pryor, a professional buyer’s agent, says buyers should be careful not to take the asking price too literally.

According to him, an asking price is not necessarily an indication of value, nor a reflection of what the seller might accept.

It’s also not necessarily what the agent advised, or what a mortgage appraiser might sign off on.

Pryor says, “It’s amazing how many people mistake asking price for value.

‘It’s just part of marketing, yet many judge the success of a sale or purchase by the ticket price.

‘It is a combination of the owner’s greed and the broker’s ‘enthusiasm’ to take over the business.

‘The largest discount on asking price we have achieved so far this year is 11 percent, but one of our best deals resulted in a 10 percent surcharge.

“Please note that the asking price is not a statement of value or an indication of what the seller will accept.”