Panic Buying in the Lewisham Property Market?

Panic Buying in the Lewisham Property Market?

Would it surprise you that there are 28% fewer properties for sale today in Lewisham than a decade ago? Property values are much higher than a decade ago and the property market at the moment in Lewisham is on fire. In all my years as an agent, I have never seen it like it is at the moment. Many people are saying it’s reminiscent of 1988 when dual-

Would it surprise you that there are 28% fewer properties for sale today in Lewisham than a decade ago? Property values are much higher than a decade ago and the property market at the moment in Lewisham is on fire. In all my years as an agent, I have never seen it like it is at the moment. Many people are saying it’s reminiscent of 1988 when dual-MIRAS relief was abolished by Nigel Lawson, as people are paying top dollar for property, because they are buying property like there is no tomorrow.


55.5% of properties on the market in Lewisham are sold stc


In a ‘normal property market’, that figure would be between 30% to 40%. There is no rhyme or reason behind it because it’s not as if we are going to run out of property to sell (unlike the panic buying of loo rolls last year in the supermarkets). With such a buoyant Lewisham property market, being adept to state what your Lewisham property is worth is exceptionally problematic.


This is further exacerbated by the lower-than-average properties on the market at the moment. To give you an idea of the issue…


there are 511 properties for sale in Lewisham today, compared to 708 a decade ago.


When there aren’t many properties on the market, some estate agents, to gain your instruction, will value your Lewisham property by giving you an over inflated suggestion for the asking price. Why do they do that when the considered wisdom is estate agents only get paid once they sell it?


Well would it surprise you that many (not all) estate agents pay their employees a bonus to put your property onto the market and then pay a further bonus when they get you to reduce the asking price? Some estate agents know the fastest way to get your property to market is to be optimistic on the asking price to secure your property for sale, then work on you to reduce your asking price after it has been sitting on the market for a few months.


Nothing wrong with that you might say, I want to get the most for my Lewisham home (and it is indeed the job of the estate agent to get the best price for their client). If I believe it is worth testing the market at a slightly higher asking price, I will suggest that, yet will always explain my thinking and if we have over cooked the asking price, we can swiftly realign it after a couple of weeks.
Yet because many estate agents are disposed to suggest over inflated asking prices to the house seller just to secure their business (i.e. overvaluing) but not manage the property for month and months ... this in turn causes Lewisham properties to sit on the market and not sell.


In the best property market for 20 years, 13% of properties for sale in Lewisham have been on the market for 6 months or more. Overvaluing is widespread among Lewisham estate agents.


Most Lewisham homeowners will ask three or four estate agents to value their Lewisham home and take the middle figure when they want to sell. Yet, if all (or most) of your Lewisham estate agents are over optimistic and they all give you a ‘gilded lily’ price to secure your instruction to sell your home (i.e. overvalue), then that middle figure will be too much. Most Lewisham estate agents know they don’t win the business (i.e. secure the listing) if they tell the homeowner what they don’t want to hear.


So, what is the risk of overvaluing?


There is a potential massive cost to putting your Lewisham home on the market at too high an asking price. Your estate agent will tell you that your Lewisham home is worth a certain figure and then lock you in to a 16-week sole agency agreement (sometimes longer) which you cannot get out of early. If you are getting around two or three viewings a week, and the pictures and marketing material are half decent, then your pricing is about right, meaning in this market you should be sold (subject to contract) within a month to six weeks.


Yet, if your Lewisham home has an over optimistic asking price (i.e. it is overpriced), you might only have a handful of viewings in a month and no offers. As the weeks and months go by, your overpriced Lewisham home makes similar homes to yours (i.e. your competition) look really good value for money. That’s when you will get the price reduction call from the agent.


How many times have you seen a property that has been on the market a while and you have wondered what’s wrong with it? Also, to add insult to injury, the portals tell you how long a property has been on the market, adding weight to that argument.


The longer your property stays on the market, the desirability
of your Lewisham home drops.


You will end up selling your Lewisham home but only after a handful of price reductions, yet at what cost? Firstly, in those lost months, you would have missed out on many properties that you fell in love with yet couldn’t buy because your home was languishing on the market with no interest (this is backed up by consumer champion Which, who said that if you have to reduce your asking price by 5% or more, it adds an extra 64 days to the sales process).


Secondly, you will end up selling your Lewisham property for less than if you had placed the property on the market at a realistic asking price from day one (again backed up by Which). This is because buyers think there is something wrong with it, so as the homeowner gets fed up, they accept a lower offer to get their property sold.


Written by Neil Raja


Click Here to read that Over 1 in 3 Lewisham Properties Are Being Sold with No Chain










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