A major hybrid agency says there is a huge ‘reality gap’ between the typical asking price of homes on sale and the price they actually sell for - and it's warning that many sellers will have to accept less.
The warning comes from the Emoov Group - now embracing Tepilo and lettings operator Urban as well as Emoov itself - in research just released.
Emoov says that the UK-wide current asking price is £414,359 while the typical sale price of £226,906 is a whopping 45 per cent less.
“While this doesn’t necessarily mean home sellers need to reduce their price expectations by 45 per cent, it highlights the gulf between the average price of homes on the market compared to those that are actually selling in the same market” says Emoov.
This gap is largest in England with properties selling for an average of £243,639 but sellers listing at an average asking price of £323,336.
In Scotland is home to the smallest gap with sellers asking £186,371 but buyers paying £156,495 on average.
Across the nation, the biggest gap is in South Gloucestershire, where the average asking price is currently £470,117 while the average sold price is £267,397 - some 43 per cent lower.
Nottingham is home to the second largest gap in England and fourth largest in the UK with a 31 per cent difference between the average asking price of £195,192 and average sold price of £135,583.
County Durham (29 per cent), Southampton (28 per cent), London, Renfrewshire and Surrey (27 per cent) are all in the top 10 biggest reality gaps, notes Emoov.
The agency also says that despite almost every area of the country being home to a lower average sold price than the average asking price, there are a few areas where the market is out- performing seller expectations.
Across the East Riding of Yorkshire, the average asking price is £170,981 but the current average sold price is £176,318, for example.
“In slower market conditions a seller’s expectation is always likely to differ from what the market dictates and what a buyer is willing to pay. It’s only natural that a seller will tend to overprice their property, largely due to the emotional element, and while many will have to reduce their price to find a buyer this research doesn’t suggest they have to do so by 45 per cent” explains Emoov Group chief executive Russell Quirk.
“What it shows is that the average asking price of properties being listed in the UK is at the £400,000 bracket, while those that are selling have an average price in the £220,000 bracket” he says.
“That’s not to say that those appropriately priced for the £400,000 bracket aren’t selling, but in current market conditions its business as usual for buyers in lower price brackets while things are more lethargic in the higher price tiers.”