I had an interesting question the other day
from a homeowner in Thorpe Arnold who asked me the difference between asking
prices and values and why it mattered. When it comes to
selling property, there must be agreement between the purchaser (buyer) and
seller (vendor) for a property sale to take place. The value a buyer applies to
a property can massively differ from the value a seller or mortgage company
places upon it. The seller, the buyer and the mortgage company must find an
agreeable value to assign to a property so the sale can proceed.
Asking prices are important as they are one of the four key matters a
potential buyer will judge your property on (the others being location,
bedrooms and type). Price yourself too high and you will put off buyers. So
let’s take a look at the Melton Mowbray numbers.
Over the last 12 months asking prices (i.e. the price advertised in the
paper and on Rightmove) in Melton Mowbray have increased by 35%, taking the
average asking price in Melton Mowbray to £274,400 (up from £202,900 twelve
months ago).
Interestingly though, when we look at, say semi-detached and terraced
property, a slightly different picture appears. Twelve months ago, the average
asking price for a semi-detached house in Melton Mowbray was £155,600 and today
its £174,200 (a rise of 12%); whilst over the same 12-month period, the average
asking price of a terraced property was £120,200 a year ago, and today its £146,200
(a rise of 22%).
In December 2015, there were 143 on the market in Melton Mowbray today
there are 136 properties on the market (down 5%). This will mean homeowners
looking to sell will need to be conscious of how their property compares
against others on the Melton Mowbray property market. The Melton Mowbray
property market still has substantial momentum and sufficient demand remains to
provoke more modest asking price rises. This noteworthy decrease in supply
since Christmas is currently providing less choice for buyers.
… And here is the second point to make. Asking prices are one thing, but
what a property sells for (i.e. value) is a completely different matter. These
are the average prices achieved (i.e. what they sold for or the average
value) for property in Melton Mowbray over the last 12 months...
·
Overall Average £212,500
·
Semi-detached £167,900
·
Terraced £141,700
You can quite clearly see, there is a difference between what people are
asking for property and what it is selling for. The underlying fundamentals of
low interest mortgages and tight supply remain prevalent in the Melton Mowbray
property market however, the number one lesson has to be this ... if you want
to sell, be realistic with your pricing.
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