The UK property market has shown resilience over the last 6 months despite initial concerns and media speculation surrounding the impact of the mini-budget and higher interest rates. In our previous articles in December and July, we anticipated the market to remain stable in 2023 with minor possible adjustments to prices. And it is exactly what happened.

According to Nationwide data, property prices in the UK saw a 0.5% increase from March to April. Similarly, Rightmove reported a 1.8% price jump in May (compared to April), while Zoopla documented a yearly increase in April of 4.1% compared to April 2022.

Properties continue to be sold, albeit at a slightly slower pace than the preceding year, while buyers have got more time to choose and negotiate. According to OnTheMarket, in April 2023 43% of properties have gone under offer within 30 days compared to 63% the year before. This is nothing unusual, quite the opposite: the market is now gradually settling into a “new old normal”. The extraordinary surge in prices and activity witnessed between 2020 and 2022 was rather an outlier period whereas current conditions reflect a return to usual pre-pandemic market dynamics.

While the overall market demonstrates stability and offers space for negotiation for buyers, specific regions and areas within the UK have experienced significant demand and continued momentum. For instance, North London areas renowned for their excellent schools and good infrastructure, such as High Barnet and Muswell Hill, have not witnessed any reduced activity at all. In these areas, correctly priced properties attract offers within a matter of days and are even subject to competitive bidding among prospective buyers. 

Our agency has also encountered similar trends in Kensington. Our recent sale was agreed for a property before it even hit the open market! We priced it correctly and targeted the right audience of potential buyers. We were able to secure an offer straight away despite other agents have been trying to sell it for our client for 6 months with no result.

To maximise visibility and optimise the chances of a successful sale, it is crucial to adopt the right pricing approach from the beginning. The popular tactic of initially listing a property at a higher price and subsequently reducing it doesn’t work nowadays. Portals’ algorithms (like Zoopla and Rightmove) prioritise listings based on submission date, meaning that older listings will be pushed to the bottom of search results. Even if the price is later adjusted, the property doesn’t go up in the search. In addition, potential buyers may interpret the reduction as a reflection of the property’s quality, leading to doubt and hesitation. The first two weeks of marketing a property are vital in terms of exposure, as it is during this period that listings receive the highest visibility. According to Rightmove, if priced correctly 75% of listed properties receive a call within 7 days. Sellers must seize this initial window of opportunity, as it becomes significantly more challenging to attract buyers once this crucial phase has passed.

Our advice to sellers

Price competitively. If not priced correctly, and if the property doesn’t go under offer within 6-9 weeks, it becomes increasingly harder to sell as it lacks visibility on portals due to their search algorithms.  

Be ready to accept discounts if you still would like to price your property ambitiously. According to Rightmove, average discount to the asking price in London that sellers should expect is about 5%. 

Our advice to buyers

Be prepared for competition. With sales volume recovering and first-time buyers showing increased interest, be prepared for competition from other buyers. Ensure your finances are in order, and consider getting pre-approved for a mortgage to strengthen your position when making an offer.

Monitor mortgage rates. Although mortgage rates have fallen in recent weeks, they are still higher compared to the previous year. Keep an eye on mortgage rates and consider seeking pre-approval from lenders to take advantage of any favorable rates and secure a more affordable mortgage.

Take advantage of increased choice and negotiate: The housing market is transitioning to a more normal level of activity, which means more choices are becoming available for buyers compared to winter. If you have been struggling to find a home that suits your needs, now may be a good time to explore the market and take advantage of the increased availability and negotiation leverage.