If
you’ve ever considered selling your Northampton home, you may have felt the
temptation to list it at a higher price, hoping for a bigger payday. After all,
who wouldn’t want to maximise the return on their largest tax-free investment?
However,
this approach has a downside that many Northampton homeowners - and even some
estate agents- overlook: the risks and costs associated with overpricing/overvaluing
your property. Recent data shows that homes priced too high take much longer to
sell and are far less likely to complete the sale successfully. Let's dive into
why correct pricing is essential to ensure a smooth and profitable sale for
your Northampton property.
Overpricing: A Common Pitfall in Northampton’s
Property Market
In
recent years, the Northampton 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 Northampton agents achieved top prices for properties,
often receiving multiple offers in a matter of days. It became the norm for a Northampton
home to sell quickly and for prices that exceeded expectations.
However,
this boom came with unintended consequences. As fewer Northampton homes came
onto the market, some agents became desperate to secure listings. To win over
potential sellers, many estate agents started overpricing properties (or,
sometimes described as, overvaluing), offering inflated appraisals that gave
homeowners unrealistic expectations. While this might sound like a winning
strategy to get more money for your home, it has caused significant distress
and delays for many Northampton homeowners.
The Impact of Overvaluing: Longer Sale Times and
Increased Risk
So, why
are so many properties in Northampton still on the market after all this time?
It often boils down to one thing: overvaluing. When a property is priced too
high, it doesn’t attract serious buyers. Instead, it sits on the market for an
extended period, leading to frustration for both the homeowner and the estate
agent. Ultimately, it gets withdrawn from the market unsold.
So, let
us look at the over-valuing statistics for Northampton since 2019.
Northampton
– NN1-NN7:
· In 2019, 50.3% of the 9,829 properties that left Northampton estate agent books, exchanged and completed. The remaining 4,881 (or 49.7%) Northampton homeowners came off the market unsold.
· In 2020, 66.3% of the 8,004 properties that left Northampton estate agent books, exchanged and completed. The remaining 3,611 (or 45.1%) Northampton homeowners came off the market unsold.
· In 2021, 66.3% of the 8,380 properties that left Northampton estate agent books, exchanged and completed. The remaining 2,820 (or 33.7%) Northampton homeowners came off the market unsold.
· In 2022, 63.9% of the 8,101 properties that left Northampton estate agent books, exchanged and completed. The remaining 2,928 (or 36.1%) Northampton homeowners came off the market unsold.
· In 2023, 50.5% of the 7,849 properties that left Northampton estate agent books, exchanged and completed. The remaining 3,886 (or 49.5%) Northampton homeowners came off the market unsold.
·
In 2024
(YTD), 52.1% of the 5,294 properties that left Northampton estate agent books,
exchanged and completed. The remaining
2,534 (or 47.9%) Northampton homeowners came off the market unsold.
Since 2019, 20,660 Northampton homeowners
who placed their property on the market have withdrawn their homes unsold, many
because of overvaluing.
The Hard Data on Overvaluing
If the
evidence isn’t enough to convince you, let’s look at more data.
Now,
you could reduce your asking price after three or four months to make your home
more realistic. That is certainly an option, yet because homes that sit on the market
for too long often develop a negative reputation, potential buyers wonder why
the property hasn't sold and may assume something is wrong with it.
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.
Also, let
me remind you of the 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 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! If this isn’t a clear sign that overvaluing is causing
harm to homeowners, which creates a lot of wasted time, stress, and
disappointment for homeowners, I don't know what it is.
Why Do Some Northampton Estate Agents Overvalue?
Many
homeowners wonder why estate agents overvalue a property if it ultimately harms
the chances of a successful sale and the agent getting paid. The answer lies in
the competitive nature of the industry. Some agents, especially those working
for larger estate agency firms, are under pressure to secure as many listings
as possible. This pressure can lead to overvaluing, as agents sometimes even
receive commissions for getting a property onto the market, regardless of
whether it sells.
These Northampton
agents appeal to a homeowner's desire to get the highest possible price by
offering an inflated valuation. However, once the property is listed, they
often encourage gradual price reductions over time, hoping to eventually make
the sale. Unfortunately, this delay can cause the homeowner to miss out on
their dream home or sell for less than they would have if they had listed it at
a fair price from the start.
The Importance of Correct Pricing Your Northampton
Home
So,
what can you do to avoid falling into the overvaluing trap? The key is to
ensure your Northampton home is priced correctly from the outset. Here are a
few tips to help you achieve that:
- Get
Multiple Valuations: Don't rely on one Northampton agent’s opinion. Ask several Northampton
estate agents to value your home and compare their suggestions. Be wary of
any agent who offers a significantly higher valuation than the others
without solid evidence to back it up. Trust is key in this process, so
make sure you're working with agents you can rely on.
- Research
Comparable Sales: Look at similar properties in your area that have recently sold.
Sites like Rightmove, Zoopla, and OnTheMarket allow you to search for
homes under offer or sold subject to contract, giving you a better sense
of realistic pricing.
- Understand
the Market Conditions: The property market is constantly changing. While prices may have
skyrocketed in 2021, the market has since cooled off. Make sure your
valuation reflects current conditions, not the highs of the past.
- Work with a Trustworthy Agent: Choose an estate agent with a reputation for honest and accurate valuations. A good agent will prioritise finding the best buyer for your home at the right price rather than inflating the value to win your business.
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 Northampton 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 Northampton 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 Northampton home,
feel free to contact us. We're here to help!
