1 in 5 Norwich Homeowners Unable to Sell

1 in 5 Norwich Homeowners Unable to Sell
  • The average time to find a buyer for a Norwich property reduced from 58 days in 2020 to 42 days in 2021.
  •  But, just over 1 in 5 Norwich homeowners are on the market after twelve weeks.
  •  Why are so many Norwich homes still on the market after all that time, and what does it mean for the Norwich property market?

You would have needed to have been living in a cave since the end of the first lockdown, not to realise the property market has been on fire in Norwich (and the UK as a whole) for the last eighteen to twenty months.

 

It has been very much a seller’s market, especially in 2021. Yet as we enter the second quarter of 2022, I have noticed a slight rebalancing of the Norwich property market, more towards buyers, something that is good news for everyone (sellers and buyers) locally.

 

In 2020, it took on average 58 days from the average Norwich property appearing on the property portals (i.e. Rightmove, Zoopla, etc) to the property going sold (STC).

 

Interesting when compared to the national average of 72 days in 2020. But, last year, this was reduced to 42 days in Norwich (51 days nationally).

 

So, what’s the issue with the Norwich property market being on fire?

 

Well, that was last year, and things have changed slightly since.

 

Of the properties for sale in Norwich, 21.6% of houses have been on the market for more than twelve weeks.

 

That doesn’t sound a lot, yet that is an eternity in this market!

 

So, why are there so many properties on the market in Norwich still for sale after all this time … it usually comes down to one thing … the practice of ‘overvaluing’.

 

So before I explain what overvaluing is, let me give you some background.

 

Many agents (not just ourselves), in 2021, were achieving top prices for Norwich property with multiple offers becoming the standard. The property they were selling was only available to buy for days before the owner obtained multiple offers that were not only at a satisfactory level, yet more than they ever dreamed likely.

 

Although this was great news for Norwich homeowners, this caused fewer homes to come onto the market in the last six months in Norwich, as people were afraid to put their home on the market without having a property to buy.

 

With fewer properties coming onto the market, some estate agents have become more and more desperate to get a larger slice of this smaller property market. It has seen an unwelcome side of the estate agency profession, the estate agency practice of ‘overvaluing’.

 

While ‘overvaluing’ is nothing new, the custom has been generally limited to a small number of estate agents. Yet now, it’s become more prevalent and creates uncountable distress and pressure for some Norwich homeowners.

 

Many Norwich homeowners want to sell quickly to get the property of their dreams. Yet, in many cases, when they do put their property on to the market, they don’t sell quickly enough because of this ‘overvaluing’ (even with the fantastic current property market conditions).

 

To give you an idea of the issue…

 

51% of Norwich homes put on the market in the last 30 days have not sold.

 

There are hundreds of Norwich families having their dreams dashed by ‘overvaluing.’

 

Therefore, let me look at exactly what overvaluing is, why it’s on the rise, and most importantly, the harm overvaluing causes to homeowners like yourself.

 

You would think the most important thing in estate agency is all about finding the best buyer for your home, at the best price, who can make the move with the least amount of hassle.

 

To us it is, and to many other Norwich estate agents, it is as well. Yet, to some agents, sales aren’t the essential objective. Instead, it is having a vigorous catalogue of properties to sell to generate more future leads.

 

Deprived of an endless number of new properties for sale, the enquiries estate agents receive will significantly drop, leaving them high and dry without any buyer (or seller) leads, the lifeblood of estate agents.

 

Therefore, some (not all), but some estate agents will feed on a homeowner’s appetite to get the highest possible price for their Norwich home by giving them an over-inflated suggested asking price to market their property at (i.e. ‘overvaluing’).

 

If one estate agent can get you an extra £30,000 for your Norwich home, you will take it, won’t you?

 

The suggestion of pushing the asking price of your Norwich home to 10%, 15% even 20% could be seen by many as a temptation too good to miss. Yet once you are on the market, the agent is trained to slowly get you to reduce your asking price over a lengthy sole agency agreement.

 

The problem is that the home of your dreams might have sold by the time you reduced your price in 3 months. Also, Which? reports in 2017 and 2019 proved you ended up getting less for your home when it did eventually sell (which means you lose money) and finally, the agents know homeowners perceive it’s a hassle to swap agents (which it isn’t).

 

But estate agents only get paid when they sell the house; why do they overvalue?

 

Would it surprise you that some Estate Agency chains pay their staff a commission when they put the property on to the market, not when it sells? So, their team overinflates their suggested asking prices to get that commission.

 

Over the last 18 months, with the rising property market, there has undoubtedly been a valid reason for pushing the envelope on the asking price. But, if every house like yours is on the market or sold subject to contract at £300,000 to £320,000, yours isn’t going to achieve £355,000, let alone £375,000 – even in this market.

 

With 51% of Norwich homes still for sale after a month, the market is starting to level out and if you are keen to sell, then let me give you some advice.

 

Research has shown that if the asking price is initially set too high, it will be ignored by people surfing Rightmove and Zoopla.

 

(Come on, be honest – you have done that yourself haven’t you?)

 

When the property is eventually reduced because it has the stigma of being on the property market too long (begging the question of potential buyers that there may be a problem with the property itself hence no interest?), often when it does eventually sell, it will sell for less than what it would have done if priced correctly from day one (as per the two reports from Which? in 2017 and 2019).

 

On the other hand, setting the asking price below its market value means potentially leaving money on the table needlessly – hence the need for a good agent.

 

Putting your Norwich home or buy-to-let investment up for sale at the right price from the beginning is the key to selling within the best time frame and for the best price to a serious and motivated buyer.

 

Ask a handful of estate agents to value your home, ask them to back up any valuation with cold hard comparables of similar properties to yours.

 

Find your comparables by searching ALL the property portals (i.e. Rightmove, Zoopla, Boomin, OnTheMarket).

 

If you only take one thing away from this article, when you search the portals for comparables, make sure you include under offer/sold STC properties, as that will triple the comparable evidence.

 

Doing your homework and then working with a dependable, trustworthy, and experienced estate agent ensures your property is on the market at the best price from day one without overcooking it (so you don’t lose out).

 

You will be just fine.

 

Stats from Land Registry, NoMis, Office of National Stats, and Denton House Research 

 

Nick Eley, Partner, Head of Sales & Lettings

 

 

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Whether you’re on the hunt for your first home or have owned your home for many years, our team really will go the extra mile to provide a first-class buying and selling experience. With excellent knowledge of Norfolk and decades of experience, we’re with you every step of the way.

Watsons Property

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