RIGHTMOVE this week reported that "asking prices" for property in Cornwall have come down 2.5 per cent so does this mean that the market is cooling?
This is actually a common occurrence at this time of the year. In the early months in a steady market and particularly where a consistent national media picture being painted is one of buoyancy and increasing prices, then not only are agents tempted to be slightly ambitious with their initial asking price to secure the instruction, but more commonly, they will agree to try an initial asking price requested by the seller, even if this is beyond their recommendation. A few months down the line, after limited interest, and no offers forthcoming, the asking price is reduced to try and generate more interest. At the same time, having experienced this over the early months, agents are keen to keep initial asking prices realistic on new properties as they come to the market as "no sale no fee" commission structures mean exactly that. Money invested in advertising, time, viewings and communication by the agent, but no sale and so no income earned.
Irrespective of the buoyancy of any market place, the same rules apply. Most interest in any property brought to the market is generated in the first four to six weeks. In general, if a sale is not agreed in this period, then the price will require re-adjusting. Often, the first potential buyer to offer will be negotiated up to the best offer received. There are far too many examples of this offer being rejected, only for the ultimate sale price agreed to be lower some time down the road.
It is vital to agree the pricing strategy and review period at the outset. Just three weeks in is the right time to assess initial interest and if the required results are being achieved. If not, what was agreed at the outset should be implemented while there are still three crucial weeks left of that initial prime period.
Equally, it is important to have any property presented to the best any seller can before commencing marketing as finishing items during the busiest viewing period can be detrimental to securing the best price possible.
Presently, there are areas of the market place with limited property available and so initial interest is high with sales often being agreed in the first week of marketing. However, this is not true across the board, so look for examples and evidence of sales when agreeing your initial asking price.
Meanwhile, the lettings market remains very active but this too can be price sensitive, especially for the larger, more expensive properties. At Goundrys lettings we are experiencing a third consecutive record month on new lets agreed as this element of the business continues to grow. In many ways the same principles apply to lettings as to sales. The initial marketing price and presentation are key to a successful result.