Why Is A Property’s Initial Asking Price So Important?

As we enter the end of the year, when buying and selling activity tends to increase in the run-up to Christmas, signs have clearly emerged that the housing market is no longer completely controlled by sellers as it used to be.

According to Rightmove’s House Price Index, whilst there was an increase in average asking prices, it was the lowest increase in October since 2008, deep in the midst of the great recession, with the number of agreed sales 17 per cent lower than in 2022.

Whilst Chorlton estate agents have noticed an increase in house prices higher than the national average, it nevertheless highlights the importance for sellers to set their initial price correctly the first time.

Whilst some sellers choose a higher price with the intention of lowering it through haggling, this is an exceptionally risky move that only pays off in a pure seller’s market when house prices are increasing across the board.

The first issue is that it shrinks your realistic marketing window. Houses get the most interest in the first two weeks they are put on the open market, and making corrections reduces the amount of time you get to find the right buyer.

As well as this, buyers will often look at the prices of nearby, similar properties to gauge relative value, and setting the price too high will often cause them to look elsewhere rather than engage with you to lower the price.

The longer a home is on the market with few offers, the more likely it is that any haggled prices are going to be a lot lower than you would have received had your price been closer to the expected value of homes in the area.

Repeating cutting the price can be counterproductive as well, as it is sometimes seen by buyers as a red flag, so it is essential to discuss price strategy with your estate agent before making any sudden moves.