The number of agreed UK property sales up to the 22nd of November 2024 is 18% higher than a year ago. Breaking this down further, as of 22nd November 2024, 1,009,340 homes were sold subject to contract (SSTC), an 18% increase from the number of homes SSTC in the same period of 2023. The average UK selling price has also significantly risen, reaching £361,000 compared to £326,000 in 2023, an 11% rise.
This doesn’t mean house prices have risen by 11%. Across the country, there has been a shift and more high-value properties have been selling this year compared to last. It is due to this factor that using £/sq.ft is a better judge of house price increase. The pound per square foot has risen only by 2.7% over the last year, climbing from £331 to £340 (which is in line with the major house price indicators).
A BUYER’S ADVANTAGE –
Sellers currently face a market where realism is the key to a good, and fast, sale. As of the 22nd November 2024, 2,061 Bath homes had been sold STC, a 14.5% increase from the 1,800 homes sold in the same period last year. The average Bath selling price has risen slightly, reaching £586,652 in 2024, compared to £562,066 in 2023 (a rise of 4.3%).
The £ per square foot on the homes sold STC for Bath has been £472 per square foot in 2024, compared to £482 per square foot in 2023.
In 2023, 59.64% of Bath homes that came to market were successfully sold (completed and exchanged). In 2024, that figure has slipped to 58.94%. This change reflects buyer expectations and affordability shifts, emphasising the need for careful pricing strategies. (Bath – BA1/2 – 1st Jan to Nov 22nd).
National figures showed that 52.96% of properties were sold (exchanged and completed) in 2023, only slightly improving to 53.62% in 2024.
If you think about it, you have just over one in two chances of selling if you put your home on the market; therefore, accurate pricing is more important than ever, but it isn’t the only factor. Homes that stand out in today’s market often do so because of exceptional marketing. Virtual or video tours, high-quality photography, and targeted social media campaigns are no longer optional—they’re essential. For sellers looking to maximise interest and achieve a strong price, presenting their property in the best possible light is a non-negotiable step.
BATHS UNIQUE MARKET DYNAMICS
Bath’s property market has always had its quirks, and this year has been no exemption. Different postcode areas are experiencing varying levels of activity. In some areas of the city (and villages), homes are selling quickly, while in others, buyers have more room to negotiate, whether on price, fixtures, or even completion dates.
This means that flexibility can be an asset for buyers. Expanding your search radius or considering properties slightly outside your initial criteria could reveal opportunities that others have overlooked. For sellers, understanding these local variations is critical to setting the right price and crafting an effective marketing plan.
A Balanced Perspective: The Seller-Buyer Dynamic
It’s worth remembering that over four out of five sellers are also buyers. This dual role often means that what might be perceived as a loss on one side of the transaction can be recouped on the other. A slightly lower sale price on your current property may open the door to negotiating a better deal on your next purchase.
External Factors Shaping the Bath Market
No property market operates in isolation, and Bath is no exception. National and global trends will inevitably influence it.
That said, Bath’s property market has shown resilience in the past, which is likely to continue. While challenges remain, stabilising mortgage rates and a steady economy offer hope for a more active market in the coming months.
Final Thoughts
As Bath’s property market moves into 2025, success will hinge on understanding the current dynamics and being prepared to adapt. For buyers, this means having your finances in order and being ready to act quickly when the right property comes along. For sellers, setting a realistic asking price for your Bath home ensures your property is effectively marketed from day one.
The journey requires a thoughtful approach, whether buying, selling or keeping an eye on the market. There are both opportunities and challenges ahead – but with the right strategy, the path forward is clear.
What’s your perspective on Bath’s property market? Have you noticed similar trends, or do you see things differently?
Are you a Bath homeowner or Landlord looking to sell in 2025?
If the answer is yes, then let us have a look at, on average, how long it takes for you to find a buyer for your Bath property and how long the solicitors will take to help get you moved in.
Independent research from Denton House shows that in the last 12 months, looking at the 1.06m properties sale agreed and the 816k properties exchanged, on average it has taken 73 days from the property coming on the market to the property becoming sold subject to contract (SSTC). This is up 6 days from the 12 months ending in June of this year.
From this point, it has then taken 113 days from the sale being agreed to completion. This is an improvement on the 117 days for the 12 months ending June 2024. The journey is a long one and not guaranteed as nationally, only 53.6% of UK homeowners who placed their homes on the market in 2023/24, have sold and moved. The remaining 46.7% have come off the market unsold.
STEP 1 – FINDING A BUYER
The first stage is to engage an estate agent (naturally, we’re here to assist) who will work with you to develop a pricing and marketing strategy tailored to attract the right buyer for your situation.
Recent data shows that over the last 3 months, a property here in Bath has taken an average of 55 days to reach an agreed sale STC. However, the bath market is far from uniform and each area in Bath has its own micro-market where it can be longer or shorter, remember this is an average.
On top of this, every ‘type’ of house also reflects different data. Let’s break it down.
(Bath centre plus a 3-mile radius).
Under £100k – 10 days
£100k to £200k – 62 days
£200k to £300k – 41 days
£300k to £400k – 65 days
£400k to £500k – 60 days
£500,000 to £1m – 53 days
over £1m – 76 days
STEP 2: INSTRUCTING SOLICITORS AND MORTGAGE BROKERS
Here at Reside Bath, we have our own list of recommended solicitors and mortgage brokers that we can get you in contact with. As the seller, your solicitor will begin preparing the legal documents for your property with your input and then forward this all to the buyers solicitor.
STEP 3: LEGAL WORK AND SURVEYS
After receiving the paperwork, your buyer’s solicitor will request local searches from the local authority and/or land registry to ensure there are no planned developments that could impact on your property. These searches can take a few weeks to complete as during this time the buyer’s solicitor may raise some questions with your solicitor. Simultaneously, a surveyor will inspect your property to confirm to the buyer that it is structurally sound and valued at the correct purchase price.
STEP 4: EXCHANGE OF THE CONTRACTS
Once the mortgage, the survey and the legal paperwork are all cleared and have come back without any issues, both the buyer and the seller can sign the contracts, leading to the ‘Exchange of Contracts’ between solicitors. At this stage, the buyer pays a non-refundable deposit, legally committing both parties to the sale. There is now one last step.
STEP 5: COMPLETION
Completion is when the money and keys are transferred. Typically, this takes place one or two weeks after the exchange of contracts, although, since the pandemic, there has been a shift to completion being on the same day as the exchange of contracts. At this point, the buyer’s solicitor sends the purchase funds to the seller’s solicitor. Once received, the keys are handed over and the sale is completed.
So to reiterate, here in Bath, it currently takes 55 days to get to the end of step 1 (finding a buyer) and a further 126 days from instruction of solicitors to completion (steps 2 to 5).
So, anticipate waiting 5 to 6 months from the point the property goes live on the market to the day that you move out. If you’re considering selling your home here in Bath, or a landlord looking for your next buy-to-let property, feel free to reach out to us.
Upcoming future legislation and the recent announcements in the autumn budget have stirred up some anxiety for the future of Buy-To-Let (BTL). The chancellor’s decision to increase the Stamp Duty Land Tax (SDLT) from 3% to 5% for landlords purchasing additional properties initially suggested a grim outlook for the buy-to-let sector. This move, coupled with the introduction of the Renter’s Rights Act, which proposes to abolish section 21 and effect a landlord database, poses new challenges for Bath Landlords but also opens doors to new opportunities. Despite these new hurdles approaching, looking in detail at market insights reveals reason for some optimism among property investors.
Taxation Changes: Assessing the Impact
The Tory and now Labour government policy changes towards the BTL sector aim to cool an overheating property market. Raising SDLT aims to redirect investment opportunities toward first-time homebuyers priced out of the market. Although this policy aims to level the playing field, it has raised concerns among investors about shrinking profit margins and thus the overall attractiveness of investment in the property market.
Despite these concerns, maintaining the current (lower) capital gains tax rates has provided a buffer, easing investor anxiety and stabilising the investment climate. However, many landlords remain cautious, aware that the stability of these rates can change as part of broader fiscal adjustments.
The Renters’ Rights Act: A New Standard
The proposed Renters’ Rights Act will abolish section 21 evictions, which allows landlords to terminate tenancies without fault. This change aims to offer greater security to tenants and ensure that there is fair treatment across the whole rental sector. Whilst this move is a positive one for renters’ rights, it does require landlords to adapt to more rigorous property management and dispute resolution strategies. This potentially increases the cost and complexity of property management.
In addition to this, the act will likely introduce stricter property standards and tenant engagement protocol. These regulations will compel landlords to improve the quality of their offering and engage more transparently and effectively with their tenants.
Market Resilience – Looking into the local market in Bath
Despite the challenges posed by increased taxation and regulatory changes, the Bath BTL market remains resilient. Demand for rentals continues to grow in the city. The average rent in Bath in 2024 was £1,759 PCM a 29% increase from 2019. Meanwhile, the number of rental properties on the market has dropped by 41.7% between 2024 and 2019.
One might say that’s all well and good, but what will this extra 2% stamp duty cost the average Bath landlord? The average price of a Bath buy-to-let property in 2024 is £345,400, meaning:
The average Bath landlord will only need to pay an additional £6,908, which is only 3.9 months’ rent.
Adapting for Success in Bath
To navigate this evolving landscape, landlords need to adopt new strategies to conquer a changing market.
Diversification: Landlords can spread risk and tap into different markets by creating portfolios that include a mix of residential types and target different demographics.
Reduction of Rent Arrears: A study by Denton House Research a couple of years ago showed that landlords who don’t use a letting agent to find them a tenant have a 272.5% greater chance of that tenant being two or more months in arrears.
Rent Protection: The removal of Section 21 will mean Bath landlords will only have Section 8 to remove tenants if they aren’t paying their rent or being antisocial. This could mean that if the tenant decides they don’t want to move, there could be a good 6 to 9 months of no rent (if not more). Therefore, you must take on rental insurance.
Final Thoughts for Bath Landlords:
While the initial outlook for buy-to-let investments in Bath might seem daunting due to recent legislative and fiscal changes, the underlying market dynamics suggest a different narrative. The demand for quality rental properties will likely continue to remain strong and provide opportunities for those willing to adapt to new changes.
The last decade has been a relentless barrage of new regulations and tax changes. From the 3% stamp duty surcharge introduced in 2016 to section 24’s limitation on mortgage interest relief, then the new renters rights act slowly passing through the government and its removal of section 21 eviction notices and finally recent reductions in capital gains tax allowances – it is fair to say that Buy-To-Let (BTL) investors have been under relentless pressure.
Now to add to this long list, the looming EPC regulation change, requiring properties to meet tougher energy performance standards, and the latest increase in stamp duty – raising its surcharge from 3% to 5%, there feels like another layer of financial burden on top of another, and it is no wonder that many landlords are feeling stretched to the limit and want to draw a line and sell up.
However, although these changes all seem daunting – let’s take a step back and evaluate the bigger picture.
For landlords with a long-term view, this extra cost is unlikely to fundamentally alter the financial viability of their investment. This one-off expense becomes ‘lost in time’ when spread out of the lifetime of an investment. Yes, it is a higher upfront cost, and as with any additional cost, it is not welcome. However, for most BTL investors, this increase won’t dramatically change the fundamentals. In fact, it’s like when the initial 3% surcharge was implemented in 2016; back then, very few landlords were deterred, and the market quickly adapted.
Another reason to stay positive is the remarkable growth in the rental sector seen over the last few years. In the last few years, rents have risen by 8-10% (Largely fueled by wage growth and continued supply/demand imbalance in the market) and are set to continue growing thanks to minimum wage rises, further bolstering the case for long-term BTL investment.
Furthermore, capital gains tax, though perceived as a deterrent, was reduced last year for higher-rate taxpayers, from 28% to 24% on residential property, which helps retain more of the gains made on property sales. Labour has made no change to that.
In real terms, UK house prices are now 15% cheaper than three years ago, another boost to the incentive to invest in BTL. So, ultimately, for savvy investors, now is potentially a more favourable time to secure a good deal for long-term gain. There will be a higher upfront cost that will have to be absorbed, but with a long-term vision, your investment can definitely be profitable.
While landlords are certainly facing pressures from the new EPC regulations in the coming years, history shows that when the government mandated the EPC rating to an “E” in 2018, it tempered the impact to avoid a market disruption with a maximum of £3,500 maximum spend to reach that level. We’ll likely see a similar approach this time if it risks an excessive withdrawal of rental properties from the market.
Ultimately, the buy-to-let market remains one of the few investment avenues where one can achieve both income and capital growth.
Bath landlords may need to consider this stamp duty increase when negotiating purchase prices, but for those with a long-term perspective, this is simply another bump in the road.
While change is inevitable, BTL still represents a sound investment – especially for those who are in it for the long haul.
Are you a homeowner in Bath? Perhaps you’re an individual or an investor planning on moving, buying or selling a property in the next six to twelve months, or maybe you’re on the lookout for your next home, perfect for the family, but not up against any time scale. Either way, having a clear understanding of the current state of the market here in the city of Bath is vital to making an informed decision and the right one for you or your family.
By reading our blog you can stay up to date on the latest market trends and activities which will help you plan effectively.
WHAT KIND OF PROPERTY MARKET DOES BATH HAVE RIGHT NOW?
One of the best ways to determine the current state of the market is to determine whether the market currently sits in a ‘buyers’, ‘sellers’, or balanced market. We can achieve this by looking at the ratio of properties marked as ‘sold STC’ or ‘under offer’ compared to the total number of properties available for sale.
For example, if 41 properties are marked as “Sold STC” out of 100 available, then the market is operating at 41%. This ratio isn’t just a random figure – it’s a reflection of the overall sentiment in the market.
Here is how the percentages breakdown to determine the market –
Extreme Buyer’s Market (0%-20%): Buyers hold all the cards.
Buyer’s Market (21%-29%): Buyers have the upper hand but not as strongly.
Balanced Market (30%-40%): A stable equilibrium between buyers and sellers.
Seller’s Market (41%-49%): Sellers begin to gain the upper hand.
Hot Seller’s Market (50%-59%): Strong competition among buyers.
Extreme Seller’s Market (60%+): Sellers dominate, with properties moving fast.
These benchmarks play a critical role, influencing everything from listing prices to negotiating leverage.
THE CURRENT SNAPSHOT OF THE BATH PROPERTY MARKET:
Oct-16 – 51%
Oct-17 – 44%
Oct-18 – 37%
Oct-19 – 38%
Oct-20 – 46%
Oct-21 – 65%
Oct-22 – 64%
Oct-23 – 50%
Oct-24 – 51%
As is expected, it was a stronger market for Bath sellers in the post-Covid years, yet things have settled down now to levels seen before the pandemic, this current percentage of 51% puts us just into a hot sellers’ market.
WHAT THIS MEANS FOR BATH SELLERS:
If you’re looking at selling your property in Bath, the current market conditions require more patience and flexibility than in 2021. The days of the stamp duty holiday and properties flying off the market within days are behind us and this means that sellers need to focus on their property marketing and prepare for longer periods on the market.
A crucial step in getting your property sold in this market is to make sure that the property is priced correctly. Now that supply is outstripping demand, it is crucial that you price your property correctly to attract demand and not deter potential buyers.
This month, 57% of properties that came to the market sold STC and to completion. The rest left the market unsold. Nationally there has also been a downward trend in the number of properties selling. This is likely due to the impending budget and potential buyers wanting to secure a lower mortgage rate if inflation continues to fall.
In light of these changes, your marketing approach should be one that is well thought out and gives your property the best chance of selling. Utilising digital tools such as virtual tours, video marketing and social media posts can give your property a competitive advantage, and help gain more serious buyers in a market where securing interest is becoming increasingly challenging.
In less competitive areas, buyers have more room to negotiate. You’ll likely find more flexibility on price and even some extras, such as fixtures, fittings, or other incentives thrown in by sellers eager to close a deal. The pressure to make quick decisions is reduced, allowing you more time to thoroughly consider your options.
It’s also worth remembering that most sellers are also buyers, so any loss you may experience on the sale side should be offset by a better deal on your next purchase.
External factors such as global economic trends, events, inflation, and interest rates will continue to influence the Bath property market in the coming months. Keeping an eye on these trends is essential for buyers and sellers alike.
Final Thoughts
As we enter November 2024, the Bath property market presents both opportunities and challenges for buyers and sellers. Understanding the subtle shifts in market dynamics is crucial for anyone planning a move, whether you’re a seasoned investor, a first-time buyer, or looking to relocate within the area.
Staying flexible, informed, and prepared will make all the difference in navigating this market. The experience of moving is as much about the journey as it is about reaching your destination.
Did you know that 1 in 10 Home Sellers in Bath Lower Their Asking Price Every Month?
As the property market continues to evolve here in the city of Bath, it is important for estate agents such as ourselves to better understand the complexities of the market. For readers, it is also important you keep up-to-date with all the going on in our property market. This can be easily achieved by following our blog, and our social media channels.
Recently, homeowners in Bath who have found themselves on the market for a long period of time are navigating the complex decision of how and when to reduce their asking prices to better attract a buyer.
With an increasing number of properties coming to the market here in Bath (1,217 on the market in August 2024) the competition is becoming increasingly competitive meaning strategic price adjustments are more crucial than ever.
MASTERING PROPERTY PORTAL PRICE BANDS FOR OPTIMAL EXPOSURE
Understanding and utilising property price bands on the ‘portals’ (Rightmove, Zoopla, OnTheMarket) can significantly enhance the visibility of your property listing. These bands are predefined price ranges buyersoften use to filter their search results. Positioning your property’s asking price in one of these bands will strategically draw in more views and therefore there will be more interest in your property, which in turn will lead to more viewings and ultimately increase your chance of selling your property.
For instance, pricing at £300,000 instead of £295,950 will place your property in a filtered search of properties between £280,000 – £300,000 & £300,000-£320,000 so you will have a chance at attracting a broader audience.
THE IMPORTANCE OF RIGHTMOVE ALERTS
A critical factor in the timing of price reductions is their impact on buyer visibility. Homeowners need to reduce their asking price by at least 2% to ensure their property reappears in Rightmove and OnTheMarket’s email alerts, while for Zoopla it is 3%, capturing the attention of active buyers.
THE CURRENT STATE OF PLAY IN THE BATH PROPERTY MARKET
In 2022, there were an average of 77 price reductions a month in the Bath area, today it’s 116 per month. The average Bath price reduction in the last 3 months was 7.1%. So, the statistics show that whilst the number of properties coming to the market is on the rise the number of price reductions has increased. In fact, the percentage of Bath properties undergoing price reductions has remained roughly consistent in recent years, with an average of 1 in 10.1 Bath homes (9.9%) reducing their asking price each month over the last five and a half years.
THE IDEAL PRICING STRATEGY FOR HOMES IN BATH
The initial pricing strategy plays a pivotal role in the speed and success of your property sale. Bath properties that get priced too high at the onset tend to stay on the market for longer and eventually require a more significant price reduction to generate new interest. By contrast, homes are priced realistically from the beginning (Click Here to find out more about the importance of pricing correctly), are far more likely to attract offers quicker and reduce the need for substantial price cuts.
For Bath sellers wanting to initially start at a ‘cheeky’ higher price, you need to be prepared to reduce this price if there is little to no initial interest. In these cases, a reduction within the first 2-4 weeks of being on the market is advisable and will help prevent stagnation in the market.
SIX THINGS TO CONSIDER FOR A PRICE REDUCTION
So, your property is on the market. It has been a few weeks and you’re wondering if you should be reducing the price. Well, here are six tips to look out for as signs you should be thinking about reducing that asking price:
A LACK OF VIEWINGS
If you haven’t received many viewings in the initial few weeks since listing your property, then it is advisable that you go and first look at your property listing and check that the marketing photos are up to standard for the area and are making your property stand out, maybe even check if your agent is willing to offer a virtual tour on your listing page (we certainly do). If you feel that the marketing material for your property is up to standard, then maybe it is time to consider a price reduction to attract new interest and boost your property on the portals.
VIEWINGS…BUT NO OFFERS
The current ratio in the UK property market of viewings to offers is around 8:10. If your property has not received any offers within the first 30 days of being on the market with your estate agent, despite there being plenty of viewings, then it could be that the price is a sticking point for potential applicants. If this is also the feedback your agent is getting then maybe it is also time to consider reducing the price closer to your bottom line.
LOW OFFERS
Homebuyers will often make low-ball offers primarily to secure the best deal possible they can for the budget they can afford. However, there can be numerous reasons. One key factor is the current market conditions – In a Buyer’s Market (more homes available than buyers) the purchaser feels that they have more power to make a low offer as the seller will be fighting other sellers to sell their house first (To find out more about Bath being a buyers or a sellers’ market, click here). Another reason for low offers is the condition a property presents itself. If a buyer feels they will need to be spending a fair amount of cash on renovations and decorative work to get it up to a standard they deem fit, then they are far more likely to take this cost into account and offer low. If you are getting low offers, remember it is not worth the value YOU think it is worth, or what your agent thinks it is worth, it is worth the value someone is willing to pay.
MARKET SATURATION
Look at the number of Bath homes that are on the market similar to your property, and check to see if you stand out from the other listings. Check on those properties similar to yours that sold too. Adjusting your price in line with the level of saturation in the market and how those properties that sold is crucial for selling your own.
SEASONAL ADJUSTMENT
Be mindful of seasonal trends within your local property market. Periods of high market activity require different strategies from the slower months of say November and December.
FEEDBACK FROM VIEWINGS
If there is consistent feedback from viewings that your property requires some work in the majority of people’s eyes, or that the price is just too high for what’s on offer, then you need to be looking at adjusting your asking price.
LEVERAGING EXPERT ADVICE
Given the Bath property market is full of many complexities, seeking out a second opinion and advice is nothing to be worried about. Experts such as ourselves are happy to help you out and offer you advice, it is what we are here for. So, if you just want another valuation or you want some advice about switching agents and lowering the asking price, then do not hesitate to get in touch with our team.
In the last 5 years, 7,149 homeowners looking to sell in Bath have been caught out by estate agents overvaluing their property. Now, understandably, if you have considered selling your property then you will have felt the temptation to list it at a higher price hoping to maximise your sale. After all – who wouldn’t want to maximise their return on their investment?
However, this approach has a downside that many have overlooked: the risks and costs associated with overpricing/valuing a property. So let us dive into why correctly pricing your property is essential to secure a smooth, quick, and profitable sale for your home here in the city of Bath.
A COMMON PITFALL IN BATH’S PROPERTY MARKET:
In recent years, the Bath property market has seen a surge in home prices, leading to fierce competition among estate agents. During the peak of the market in 2021, many estate agents in Bath achieved top prices for properties, often receiving multiple offers in a matter of days. This quick time to sell was likely brought about by the desire for those to move out of metropolises such as London due to the pandemic and move to a quieter area with more space for their money. However, this quick time to sell and above-average pricing came with unintended consequences.
As fewer homes in Bath came onto the market after this boom, agents became desperate to secure listings. So, to secure potential sellers, many agents began over-pricing properties. This ‘overvaluing’ has led to delays and distress for many Bath homeowners as their property is then in turn not attracting as much attention as they thought it would leading to a significantly increased sale time and often a price reduction.
THE IMPACT OF OVERVALUING – LONGER SALES TIMES AND INCREASED RISK:
So, why are so many properties in Bath still on the market after a prolonged period of time? Often it all comes back to this concept of ‘overvaluing’. When a property is priced too high, you don’t attract serious buyers. Instead, your property sits on the market for an extended period, leading to frustration for both homeowner and agent and ultimately these properties end up being taken off the market unsold.
So, let’s look at the statistics:
Since 2019, in the regions of the BA1/2 area –
In 2019, 46.7% of the 3,693 properties that left Bath estate agent books, exchanged and completed. The remaining 1,970 (or 53.3%) Bath homeowners came off the market unsold.
In 2020, 69.4% of the 3,116 properties that left Bath estate agent books, exchanged and completed. The remaining 1,430 (or 45.9%) Bath homeowners came off the market unsold.
In 2021, 69.4% of the 3,254 properties that left Bath estate agent books, exchanged and completed. The remaining 996 (or 30.6%) Bath homeowners came off the market unsold.
In 2022, 72.1% of the 2,885 properties that left Bath estate agent books, exchanged and completed. The remaining 805 (or 27.9%) Bath homeowners came off the market unsold.
In 2023, 59.2% of the 2,815 properties that left Bath estate agent books, exchanged and completed. The remaining 1,148 (or 40.8%) Bath homeowners came off the market unsold.
In 2024 (YTD), 57.4% of the 1,877 properties that left Bath estate agent books, exchanged and completed. The remaining 800 (or 42.6%) Bath homeowners came off the market unsold.
THE HARD DATA ON OVERVALUING:
Now, you could reduce your asking price after three or four months to make your home’s price more realistic and affordable. This is certainly an option, yet because homes that sit on the market for too long often develop a negative reputation, potential buyers will end up asking themselves why the property has been on the market for so long and if there is a ‘hidden issue’ in the property that is causing it to not sell – essentially buyers automatically assume something is wrong with the property and get deterred.
As a result, even when the price is eventually lowered, as reported a few years ago, the property is likely to sell for less than it would have if it had been priced correctly from the beginning.
Recent independent research from TwentyEa and Denton House Research, that a UK home that takes over 100 days to sell (i.e. more than 100 days between coming on the market and agreeing on a sale) has only just over a 1 in 2 chance (56%) of successfully exchanging and completing the sale. The remaining 44% of sales fall through.
In contrast, if a property has its sale agreed in under 25 days, the chances of exchanging and completing rise to 19 out of 20 (94%). That’s a significant difference!
THE IMPORTANCE OF GETTING THE CORRECT PRICING ON YOUR HOME IN BATH:
So, what can you do as a homeowner to make sure you don’t fall into the overvaluing trap? The key is to ensure that your Bath home is priced correctly from the outset. Here are a few tips that should help you achieve this with your agent:
GET MULTIPLE VALUATIONS: Now this may sound backwards coming from a local estate agent. However, do not rely on your first appraisal. Ask several agents for a valuation and compare the suggestions. Then, choose which agent you think will work best for you and your property. We would love for you to choose us so if you are interested in getting a valuation then click here. Our team have been working in the City of Bath for over 15 years and our property consultants are locals to the area having grown up here, so our wealth of knowledge is plentiful!
RESEARCH COMPARABLE SALES PROPERTIES: Head to a Rightmove page full of sales properties in your local area and compare how similar homes to yours that have sold recently have been priced and see where you feel your property sits. You can also take a look at local agents’ sales property pages as some homes will not be listed on Rightmove.
UNDERSTAND THE CURRENT MARKET CONDITIONS: The property market is constantly changing. The highs of the 2021 post-pandemic property market have now cooled off, so make sure you are getting a valuation that reflects current market conditions. It is also a good idea to follow local agents. You can keep up to date with the latest on the Bath property market from Bath’s newest Estate Agents here – or you can follow us on our social media pages found in our linktree.
WORK WITH AN AGENT YOU TRUST: Choosing an agent that is a good fit for you is crucial. Look at how they market properties, do they have a good reputation and whether they will do what is in your best interest, not just theirs. If you want more information about our sales services, then Click here.
FINAL THOUGHTS:
Overvaluing might seem tempting – but the risks far outweigh the potential rewards.
Not only does it result in longer sale times, but it also decreases the likelihood of a successful completion. By pricing your Bath home accurately from the start, you can increase your chances of getting a decent price and a smooth and profitable sale.
Remember, the goal isn’t just to sell your Bath home – it’s to sell it for the best price, within the best time frame, to a serious and motivated buyer. By working with an experienced and honest estate agent, you can avoid the pitfalls of overvaluing and achieve the successful sale you deserve.
If you have any questions or would like more advice on selling your Bath home, check out our dedicated sales page for both Buyers and Sellers – and always feel free to pop into our office or give us a call.
The Bath Property market has undergone significant changes over the past few years, as depicted in the graphs below. These visual aids capture the trends in the number of properties available for sale and the number of properties sold subject to contract (SSTC) from January 2019-2024. By analysing these graphs, we can gain insight into the evolving dynamics of the local property market and the necessity for Bath homeowners to adopt realistic pricing strategies when bringing their homes to market.
A CLOSER LOOK AT THE BATH MARKET DYNAMICS (2019-2024) –
From January 2019 to February 2020 (a normal market), the number of properties for sale in Bath remained relatively stable, at an average of 1,278 homes (bath being BA1/2). This pre-COVID period also showed a steady number of properties being sold each month, with an average of 181 home sales. This indicated a balanced market where the supply of homes was more or less matched by buyer demand.
The Bath property market underwent a noticeable shift with the onset of the COVID-19 pandemic in late March 2020. As the pandemic gripped the nation, the number of properties that sold in April and May 2020 plummeted sharply. This was due to the uncertainty brought about by the pandemic. Many buyers held off amidst the uncertainty.
However, the floodgates opened once the property market lockdown was lifted in May/June 2020. The number of properties coming onto the market between June and August 2020 rose by 27% above the long-term average for that time of year, and the number of homes selling also rose.
In Bath, in the 20 months between May 2020 and December 2021, the average number of Bath homes sold per month was 245, with the biggest month being 342 homes Sold Subject to Contract (SSTC). However, the number of homes for sale slowly dropped throughout the period to an all-time low of just 540 homes for sale in December of 2021.
What stands out during this period is that despite the reduced number of Bath properties for sale, the number of properties sold remained robust. This surge in demand, despite a drop in available Bath homes, can be attributed to the combination of pent-up demand and the government’s intervention in the property market. Most notably the stamp-duty-holiday incentivised buyers to move quickly before the levy was lifted.
As the dust settled moving into 2022, the property market began to feel as it was coming back towards and ‘normal’ market. The number of homes selling settled down and the general level of properties for sale steadily began to rise. However, as we ended the summer of 2022, the property market was struck twice within a span of 12 months.
The first hit on the market came in the spring of 2022 when then Prime Minister, Liz Truss and her chancellor Kwasi Kwarteng, produced their now infamous mini budget. Following this, there was a five-month period dropped, stooping to an average of 140 sales per month. It started to recover in the spring of 2023, as home sales rose to an average of 223 sales per month, only to be hit again when the increasing interest rates started to really bite in the summer of 2023. Home sales then slumped to 181 sales per month during the summer of 2023.
NUMBER OF BATH HOMES FOR SALE AFTER JANUARY 2024 –
Since January 2024, the number of Bath homes selling has been at an average of 218 homes per month. However, the number of homes for sale has steadily risen to 1,213 in August 2024 alone. The significant increase in supply could be due to various factors, including homeowners taking advantage of high property prices at the moment, an increase in new builds, or even a growing number of properties that failed to sell in previous months/years now being re-listed with a new agent.
PERCENTAGE PROPORTIONS: BATH VS. UK TRENDS –
The second graph below delves into the dynamics here by comparing the same set of numbers to each other and expressing them as a percentage.
By doing this, we can see the proportion of monthly homes sold relative to the number of properties available. This yellow line on the graph represents the % of Bath properties sold SSTC during the month as a proportion of the homes for sale. The red line shows the equivalent figure for the UK average.
The graph reveals important information. Throughout 2020-early 2022, the proportion of UK homes sold in Bath (yellow line) spiked into the mid to high 30% range. This aligns with the earlier observation that despite fewer homes being available, a higher percentage of these homes were being snapped up quickly by buyers wanting to make the most of the government intervention following the pandemic.
However, as we moved to 2022 and beyond, this trend began to reverse. The proportion of homes sold (as a percentage of homes for sale) in bath started to decline and now the figure stands around the mid-teens.
SO, WHAT DOES THIS MEAN FOR BATH HOMEOWNERS? –
The stable number of home sales against a backdrop of increasing supply could be signaling that there is a potential issue. The market may be approaching a tipping point where supply outsees demand and thus prices begin to fall as the market becomes a buyers’ market and there are more options for buyers. This increase in supply means those serious about getting a sale need to make sure they are getting their homes valued and listed at a realistic price mark. Pricing too high in this market will lead buyers to be deterred by other options they have available with such a high supply.
A price too high in this market will lead to long listing times, and price reductions, both of which can deter some buyers as they may assume this is due to an unforeseen issue within the property. Neither of these are wanted by sellers so it is critical that you get that listing price correct.
Also, remember that a longer listing time means that a sale is more likely to fall through, even if a sale is agreed upon. Looking at an examination from Denton House Research using data from TwentyEA, they noted that if a UK home sold within 25 days of the property coming to market, there was a 94% chance of the sale going all the way through to completion. If the sale was agreed upon over 100 days after it was listed on the market, then the chances of actually completing the sale is reduced vastly to 56%.
IN CONCLUSION –
Whilst the Bath property market remains active, ‘this has introduced a new challenge for sellers. To achieve a successful sale, Bath homeowners must pay close attention to market trends and set their prices accordingly. Realistic pricing and an understanding of the broader market dynamics will be vital in navigating this evolving landscape. As the data suggests, the market is still healthy, but the balance of supply and demand is shifting which is making strategic pricing is more critical than ever.
The UK property market has undergone significant shifts since the summer of 2020. This has been driven primarily by the post-lockdown ‘rush to move’ after everyone who’d been stuck inside for 3 months felt they had ‘outgrown’ their homes and were further incentivised by the stamp-duty levy.
Following this rush to move, there have been significant interest rate hikes aimed at curbing inflation in 2022 & 2023. These changes have had far-reaching implications across the property market and have had a significant impact on both house prices and the overall volume of property transactions.
INTEREST RATE SURGE AND ITS IMPACT:
The initial wave of interest rate hikes began in November 2021, as the Bank of England (BoE) sought to counter the ever-rising inflation post-lockdown, and this continued until the summer of 2023.
There were 14 rises in interest rates during this period – the culmination of which was a peak rate of 5.25%. The Bank of England’s decision to implement such a rigorous monetary policy stemmed from concerns about the rapidly escalating cost of living (now dubbed the ‘cost of living crisis’), the consequence of both domestic and global pressures.
However, the tide began to turn this August as the BoE cut rates slightly to 5% in response to the improvement of the nation’s inflation rates. This reduction was coupled with signs that further cuts could be on the horizon, something that has brought about a sense of cautious optimism in the market. There is, for the first time in many months, a slight glimmer of hope that the worst of the economic fallout may be behind us.
HOW HAS THIS AFFECTED THE LOCAL PROPERTY MARKET HERE IN BATH?
Let us first look at the house prices locally between 2020 and 2024.
The average value of a property in Bath in July 2020 was £347,652. Today, that figure has risen to £432,528 – a rise of 24.42%, significant. So despite predictions that there would be a property market crash of sorts, there hasn’t been. So with prices not dropping, surely it is cash buyers that are keeping the property market afloat? Especially considering the hike in interest rates over the last 4 years.
CASH BUYERS: NOT THE GAME CHANGER WE EXPECTED:
In analysing the performance of the different segments of the British property market during this tumultuous period, one of the more surprising findings is the limited role that cash buyers have played in keeping the Bath property market alive. Traditionally, cash buyers have been perceived as having a significant advantage in house buying when there are periods of high interest. This is due to the lack of financing needed which in turn allows them to be protected from the direct effects of higher borrowing costs. So in theory, this should allow them to dominate the market when mortgage rates soar. So, did the number of cash buyers rise when interest rates began to rise in 2022?
THE PROPORTION OF UK HOME BUYERS WITH CASH HAS INDEED RISEN FROM 20%+ IN 2020/21 TO 30%+ IN 2023/24:
So as the above statement says, there has indeed been an increase in cash buyers, but this has not been the expected avalanche. Despite significant financial advantages, cash buyers did not dramatically alter the market dynamics. Instead, the dictators of the pace of the market turned out to be those who were reliant on mortgages. So, even as the cost of borrowing increased, there continued to be many mortgage-backed buyers and the cash buyers didn’t dictate the market as expected. This trend truly underlines the critical role mortgage buyers play in shaping market conditions.
Locally here are the figures:
In 2020, 27.57% of UK home buyers were cash buyers, whilst in Bath and North East Somerset, 28.6% of buyers were cash buyers.
In 2021, 28.06% of UK home buyers were cash buyers, whilst in Bath and North East Somerset, 31.2% of buyers were cash buyers.
In 2022, 27.79% of UK home buyers were cash buyers, whilst in Bath and North East Somerset, 32.1% of buyers were cash buyers.
In 2023, 32.94% of UK home buyers were cash buyers, whilst in Bath and North East Somerset, 38.9% of buyers were cash buyers.
In 2024 YTD, 31.15% of UK home buyers were cash buyers, whilst in Bath and North East Somerset, 35.0% of buyers were cash buyers.
Locally in Bath and Northeast Somerset, we also saw a growth in cash buyers – yet again, nothing groundbreaking!
MORTGAGE STRESS-TESTING AND MARKET STABILITY:
So, why were those who predicted a significant crash in the market so wrong, despite the increased mortgage rates? Well, mostly it was down to the effectiveness of the mortgage market review stress testing rules introduced in 2014 for borrowers after the global financial crisis of 2008. These rules, designed to ensure that borrowers could withstand higher interest rates, have been instrumental in maintaining stability in the property market. Even as mortgage rates more than quadrupled from their lows, over three quarters of UK’s local authorities saw house prices increase between the spring of 2022 and the spring of 2024.
This stability is further evidenced by the relatively low levels of repossessions compared to the aftermath of the 08/09 financial crisis. In the 4 years following the global market crash of 2008, 113,374 homes were repossessed in the UK. In the Covid years of 2020-2023, that number was 7,379.
Alongside this, strong wage growth (up from £31k a year to £35k) during this period and lender forbearance, have also played a pivotal role in supporting those who borrowed during the challenging period.
These factors collectively prevented the kind of widespread distress that many feared would occur as rates climbed.
AFFORDABILITY AND THE SHIFT IN BUYER PREFERENCES:
While house prices have held sturdy in most places, affordability has continued to be a significant concern for buyers, particularly in more expensive markets such as London. The term ‘race-for-space’ came about from the pandemic where buyers, held up in their smaller more confined homes in the big cities, sought to move further afield and gain more space for their money given many were working remotely and no longer needed to be held up in a commutable location. This rush in migration from urban areas to suburban or even rural areas has been a defining characteristic of the property market over the last few years. As rates have continued to rise, this trend has continued and even gained further momentum.
In the more expensive locations, where the cost of living and property prices were already high, the increase in mortgage rates has made buying a home even more challenging for many. As a result, these sorts of areas have seen a shift in the buyer demographic. Those less affected by higher rates—such as wealthier individuals or those moving from more affordable regions—continue to purchase, while others have been priced out.
SALES VOLUMES VS. PRICES: A COMPLEX RELATIONSHIP:
As we evaluate the performance of the UK housing market – it is evident that whilst prices have remained strong, the volume of sales has decreased in 2023 when compared to the surge that we witnessed in 2021.
Back in 2021, sales transactions peaked at approximately 1.4million, a significant increase when compared to the previous year. However, by the time 2023 rolled around, this figure had decreased to around 1.02million.
Despite the rise in interest rates during 2023, the transaction levels remained in line with long-term trends (1.06 million transactions on average per year between 2008 to 2019), highlighting the current resilience of the housing market. Current projections for the 2024 housing market are suggesting we may reach 1.15 million sales, indicating that the property market continues to be stable and aligns closely with historical norms.
The persistence of strong prices, despite lower volumes of transactions, suggests a degree of pent-up demand. If Bath buyers perceive that interest rates have stabilised or are beginning to decline, we could see a significant increase in transaction activity. This potential recovery is likely to be the most pronounced in regions where affordability remains a key factor, and where the desire for more space continues to drive buyer behaviour.
LOOKING AHEAD – A PIVOTAL MOMENT FOR THE BATH MARKET:
As we move forward, the property market in the UK looks to be held at a crucial juncture. The market is currently showing positive signs as we get to the latter end of 2024. Listings are up by 7.2% YTD compared to pre-pandemic levels and gross sales, 22% higher than the same time in 2023. Net sales have also been surging, a 28% increase compared to the same period from last year. Additionally, the 2.6% rise in sales price/sq.ft since January indicates a steady increase in demand.
Coupled with the recent rate cut and better-than-expected inflation figures, this may signal the beginning of a more stable period for the UK housing market. If the financial markets prediction of another cut by the end of the year to interest rates, then we may see renewed confidence among buyers.
However, it’s essential to recognise that the landscape has changed. The experience of the past four years has reinforced the importance of affordability, the resilience of stress-tested borrowers, and the critical role of mortgage buyers in setting market dynamics. As estate agents, understanding these shifts is crucial in navigating the evolving market and advising clients effectively.
As a Bath homeowner looking to sell, it’s crucial to approach the market with a realistic mindset. With only 53% of properties that come onto the market successfully reaching a completed house sale and move, the odds of selling can feel like a flip of a coin, (12 months to 23rd August 2024, of the 1,420,486 homes that left UK estate agents books, 798,886 homes exchanged and completed, and 710,620 homes withdrew unsold).
To ensure you’re on the right side of that coin, it’s vital to set a competitive price and present your property in the best possible light as this can significantly increase your chances of securing a sale and achieving your moving goals.
In Bath and similar towns and cities, where affordability and the search for space are particularly relevant, the insights gained from this period of upheaval will be invaluable. By staying attuned to these trends and anticipating the needs of our Bath clients, we can offer informed guidance in a time of change.
In conclusion, while the past four years have been challenging for the Bath and UK property market, they have also demonstrated its underlying strength and adaptability. As we potentially enter a more stable period, there is cause for cautious optimism. By understanding the factors that have shaped recent performance, we can better navigate the road ahead and continue to support our clients through whatever challenges and opportunities the future may hold.
If you would like to discuss anything about the Bath property market, please do not hesitate to call us at the office.
