- The average time to find a buyer for a Bath property reduced from 72 days in 2020 to 66 days in 2021.
- Yet just over 1 in 4 Bath homeowners are still on the market after 12 weeks.
- Why are so many Bath homes still on the market after all that time, and what does it mean for the Bath property market?
If you had been living in a cave since the end of Lockdown No. 1, you might have still heard that the property market has been on fire in Bath (and the UK as a whole) for the last 18/20 months.
It has been very much a seller’s market, especially in 2021. Yet as we enter the second quarter of 2022, I have noticed a slight rebalancing of the Bath property market towards buyers, something that is good news for everyone (sellers and buyers) locally.
In 2020, it took on average 72 days from the average Bath property appearing on the property portals (i.e. Rightmove, Zoopla etc.) to the property going sold (STC).
Interestingly, Bath was bang on the national average of 72 days in 2020. Yet, last year, this was reduced to 66 days in Bath (51 days nationally).
Well, that was last year, and things have changed slightly since.
Of the properties for sale in Bath, 26.6% of houses have been on the market for more than 12 weeks.
That doesn’t sound a lot, yet that is an eternity in this market!
So, why are there so many properties on the market in Bath still for sale after all this time? It usually comes down to one thing… the practice of ‘overvaluing’.
So before I explain what overvaluing is, let me give you some background.
Many agents in 2021, were achieving top prices for Bath property with multiple offers becoming the standard. The property they were selling was only available to buy for days before the owner obtained multiple offers that were not only at a satisfactory level, but more than they ever dreamed likely.
Although this was great news for Bath homeowners, this caused fewer homes to come onto the market in the last six months in Bath, as people were afraid to put their home on the market without having a property to buy.
With fewer properties coming onto the market, some estate agents have become more and more desperate to get a larger slice of this smaller property market. It has seen an unwelcome side of the estate agency profession, the estate agency practice of ‘overvaluing’.
While ‘overvaluing’ is nothing new, the custom has been generally limited to a small number of estate agents. Yet now, it’s become more prevalent and creates uncountable distress and pressure for some Bath homeowners.
Many Bath homeowners want to sell quickly to get the property of their dreams. Yet, in many cases, when they do put their property on to the market, they don’t sell quickly enough because of this ‘overvaluing’ (even with the fantastic current property market conditions).
To give you an idea of the issue …
65.8% of Bath homes put on the market in the last 30 days have not sold.
There are hundreds of Bath families having their dreams dashed by ‘overvaluing’.
Therefore, let me look at exactly what overvaluing is, why it’s on the rise and most importantly, the harm overvaluing causes to homeowners like yourself.
You would think the most important thing in estate agency is all about finding the best buyer for your home, at the best price, who can make the move with the least amount of hassle.
To us it is, and to many other Bath estate agents, it is as well. Yet, to some agents, sales aren’t the essential objective. Instead, it is having a vigorous catalogue of properties to sell to generate more future leads.
Deprived of an endless number of new properties for sale, the enquiries estate agents receive will significantly drop, leaving them high and dry without any buyer (or seller) leads, the lifeblood of estate agents.
Therefore, some (not all) estate agents will feed on a homeowner’s appetite to get the highest possible price for their Bath home by giving them an over-inflated suggested asking price at which to market their property (i.e. ‘overvaluing’).
If one estate agent can get you an extra £30,000 for your Bath home, you will take it, won’t you?
The suggestion of pushing the asking price of your Bath home up by 10%, 15%, even 20% could be seen by many as a temptation too good to miss. Yet once you are on the market, the agent is trained to slowly get you to reduce your asking price over a lengthy sole agency agreement.
The problem is that the home of your dreams might have sold during the 3 months in which you have been reducing your price. Also, Which? reports in 2017 and 2019 proved you ended up getting less for your home when it did eventually sell (which means you lose money) and finally, the agents know homeowners perceive that it’s a hassle to swap agents (which it isn’t).
But estate agents only get paid when they sell the house; why do they overvalue?
Would it surprise you that some estate agency chains pay their staff a commission when they put the property on to the market, not when it sells? So, their team overinflate their suggested asking prices to get that commission.
Over the last 18 months, with the rising property market, there has undoubtedly been a valid reason for pushing the envelope on the asking price. Yet, if every house like yours is on the market or sold subject to contract at £300,000 to £320,000, yours isn’t going to achieve £355,000, let alone £375,000 – even in this market.
With 65.8% of Bath homes still for sale after a month, the market is starting to level out and if you are keen to sell, then let me give you some advice.
Beware the same practice from lettings agents
Nearly everything I’ve written in this article similarly applies to getting your property valued by a lettings agent. Many agencies secure instructions by quoting a high rental figure and tying their client into a lengthy sole agency period.
A couple of weeks later, the landlord will receive a phone call from their agent, saying that they must ‘listen to the market’ and reduce the advertised rent.
The landlord will eventually find their tenant, but weeks later than they should have done, and with an agency that was prepared to secure their business by deliberately overpricing.
Research has shown that if the asking price is initially set too high, it will be ignored by people surfing Rightmove and Zoopla.
(Come on, be honest – you have done that yourself haven’t you?)
When the property is eventually reduced because it has the stigma of being on the property market too long (begging the question from potential buyers or tenants that there may be a problem with the property itself hence no interest?), often when it does eventually let or sell, the owner will achieve less than it would have done if it were priced correctly from day one (as per the two reports from Which? in 2017 and 2019).
Of course, on the other hand, setting the asking price below its market value means potentially leaving money on the table needlessly – hence the need for a good agent.
Putting your Bath home or buy-to-let investment on the market at the right price from the beginning is the key to selling within the best time frame and for the best price to a serious and motivated buyer / tenant.
Ask a handful of estate agents to value your home, ask them to back up any valuation of your Bath home with cold hard comparables of similar properties to yours – ideally, properties that have actually sold, rather than ones that are languishing on the market at a high asking price.
Find your own comparables by searching ALL the property portals (i.e. Rightmove, Zoopla, Boomin, OnTheMarket).
If you only take away one thing from this article, when you search the portals for comparables, make sure you include under offer/sold STC properties, as that will triple the comparable evidence.
Thus, by doing your homework and then working with a dependable, trustworthy and experienced estate agent, who will help to ensure that your Bath property is put on the market to get you, the homeowner, the best price from day one without overcooking it so you don’t lose out, you will be just fine.
These are my thoughts, let me know if you have any yourself.
Reside is an award-winning independent letting agent in Bath. Please get in touch if you would like to discuss any aspect of letting or managing your property; we would love to hear from you.
