Vendors are increasingly open to negotiations to secure deals, with asking price discounts increasing to 4.2% from the original asking price over the past four weeks, representing an average of £12,125, the highest level since March 2019, the latest data from Zoopla shows.
The greatest discounts can be found in London, at an average of 4.8%, which is significantly higher than the 2.8% recorded for the rest of the UK.
“It certainly remains a buyer’s market,” said Richard Donnell, research director at Zoopla. “The asking price isn’t the value of the home. It’s the starting point. In today’s market, buyers are negotiating a bigger discount.”
Zoopla’s report also shows that buyer demand has improved for the first time since the Spring, up 12% over the past four weeks, although it remains a third lower than a year ago.
The property portal says that overall stock of homes for sale is up 18% on the five -year average but the flow of new supply is down 6% and sales agreed have dropped by 19%.
Somewhat surprisingly, property purchasers appear unwilling to compromise on the size of the property they are looking for despite having 20% less buying power due to higher mortgage rates, according to Zoopla, which said the average UK house price dropped by 0.5% over the past 12 months to £265,100.
Nathan Emerson, CEO of Propertymark, commented: “This recent report reiterates what our member agents are telling us. Last month there was a 29% rise in the number of new properties for sale which shows many people are continuing to find an affordable middle ground when coming to the market and negotiations well underway.
“We imagine this picture will only get stronger with more sales completing in the coming months given the recent positive news of inflation rates remaining unchanged, given much-needed encouragement to those buyers who were hesitant.”
Matt Thompson, head of sales at Chestertons, added: “Since the Bank of England’s announcement of interest rates remaining at 5.25% for the time being, we have seen a positive response from buyers in September who felt more secure to make financial decisions and resume their property search.
“Understandably, buyers who are now entering the market are particularly careful about their budget and factor in any future rate hikes as well as the cost of living. As demand for properties in the capital continues to outstrip supply, the market remains competitive.”
