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There has been a 26% increase in the number of properties reducing their price this quarter (July-September 2023), compared to the five-year average, according to new research from Street.co.uk.
However, the data, provided by Spectre, shows this is a significant decrease from the 50% increase observed in the previous quarter (Q2). Removing the influence of seasonality, this is a gradual decline in properties dropping their price, with sellers appearing to be adapting to new market conditions, and heeding agents’ advice to price realistically from the outset.
Heather Staff, co-founder of Street.co.uk, commented: “The main drivers for price reductions are the South East and East regions. The South East, in particular, stands out with over half of the monthly listings experiencing price drops. In contrast, the North of England, specifically the North East, experienced far fewer price reductions per listing, with 38% of listings reduced this quarter.”
Staff continued: “Looking forward, these trends in property price reductions provide valuable insights into where the market is heading in the future. The decreasing gap between current and average reduction volumes may indicate a move to a more stable, but subdued market. The regional disparities emphasise the importance of considering local factors in property market analysis.
“This increase suggests a significant shift in the pace of property transactions, with sellers facing longer waiting times for successful sales. However, it’s important to recognise the influence of seasonality. As the market transitions into autumn and winter, properties tend to stay on the market for slightly longer. This seasonality contributes to the overall increase in time on the market.”
Time to Sell
The study also found that properties are taking 19 days longer to sell compared to the same period last year. The average time for properties to sell across the UK is now sitting at 48 days.
The property market is experiencing a noticeable slowdown, with the percentage of properties selling in under four weeks in September reaching its lowest level since January. The month-on-month decline can mostly be attributed to seasonality. The overall trend appears to be following a typical pattern for this time of year, though at a lower level than last.
Thomson Staff, co-founder of Street.co.uk, said: “One significant consequence of the decline in properties selling within the first month is the increase in price reductions. As fewer properties sell quickly, many agents are taking action to generate interest in their listings. We can expect price reduction volumes to remain high as agents try to keep properties attractive to prospective buyers in a market where quick sales are becoming less common.
“The likelihood of properties selling within a month is expected to decrease further as the year progresses, with the usual upturn expected in the new year. However, it’s important to note that we shouldn’t anticipate a return to when over 60% of properties sold within a month.
“Recent years have seen a faster-paced market that puts buyers at a disadvantage. With the market now favouring buyers, we can expect sales agreed to occur at a more relaxed pace, allowing them to shop around more than in previous years. Hopefully, this will result in fewer sales falling through, as sales agreed are more thought out before an offer is made.”
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