Brokers share their views on oversaturated markets
Some areas of the property market are becoming oversaturated with for-sale stock, as cooling conditions see the nation’s home sellers struggle to secure a buyer, according to House Buyer Bureau.
However, brokers have conflicting views on the extent to which conditions are cooling and whether sellers are truly struggling or not.
No evidence of stock outpacing demand
Rhys Schofield (pictured), director at Peak Mortgages and Protection, said he is yet to see evidence of sellers struggling to attract buyers. With properly priced stock, Schofield said demand is still up on pre-pandemic levels overall.
“From the coal face however, we are hearing stories that the more desperate estate agents are massively overvaluing houses by £50,000 plus just to win listings, and unsurprisingly, that stock is sitting unsold in what is now a buyer’s market,” he said.
Schofield said the likes of Purplebricks have already failed, so he believes it is likely agents who simply stick a house on Rightmove for a minimal fee will follow the same path.
However, he said for those proactive agents who work to sell houses, and obtain the best price for their clients, they will continue to grow their market share.
“I would certainly be avoiding ‘low fee’ or ‘zero commission agents’, given that the true ‘cheapest’ option is the one who sells your house for the most money, and leaves you with the maximum sum in your back pocket,” Schofield said.
Rohit Kohli, operations director at The Mortgage Stop, said people are still actively buying, so he has not seen a drop in prices of any meaningful amount, yet.
“We are noticing that negotiations are taking longer with much more back and forth on price, but no real movements from sellers just yet,” he added.
Kohli said what he has witnessed is agents becoming much more aggressive in their tactics, both in acquiring new business, with overpriced valuations, and trying to force through conditional offers.
This, Kohli said, is a real indicator of the issues starting to emerge in the mortgage market at present.
Caution advised
Joe Stallard, director and adviser at House and Holiday Home Mortgages, said it is only natural to see buyer caution as rising mortgage costs are hitting home.
“Add to that the rising cost-of-living, and people are more likely to re-evaluate the space they already have; better to refurbish, I suppose, than boldly go into unexplored new territory,” he said.
For the most part, Stallard said he is seeing activity related to those who have come to a point in their lives where they really need to move. He said that seems to be the driving force behind buyer activity at present, and added that it makes sense with many coming to the end of their mortgage terms.
“So for now, unless our clients are having to move elsewhere for family, work, or space exploration, those who have an eye on capitalising property are hunkering down,” Stallard said.
Have you witnessed stock outpacing demand in the current market? Let us know in the comment section below.
