Homes have sold for £11,000 less than their asking prices on average during the past year, despite the pandemic property boom, new research has revealed.
Some areas have seen significant reductions, with some high-value postcodes seeing a huge six-figure drop in asking prices.
London has been hardest hit by sellers’ need to downgrade their initial expectations – and the capital’s SW3 postcode, which includes Chelsea and parts of Knightsbridge, saw the biggest average monetary reductions of £145,480, although that is the equivalent of just 5.49 per cent off asking prices.
By contrast, the lowest reductions were in the Birmingham postcode of B37, with average drops of just £2,030 or 1.07 per cent on average.
According to the research, the capital’s SW3 postcode saw the largest average reduction of 145,480.
Property Solvers, a house group, conducted research to track 72,982 property transactions in October 2020 and October 2021. The average difference between asking prices on Rightmove versus actual sold prices at the Land Registry was found.
To avoid any skewing of the results in areas with low volumes of sales, it was necessary to have at least 15 property sales per postcode. This allowed us to identify areas with the highest price discounts in England.
Nine out of ten of the postcodes that saw the greatest reductions in asking price were located in London.
Although average house prices in London are still much higher than elsewhere in the country, some areas have seen their values drop as buyers look for more space and work remotely.
The only postcode in the top 10 not in London is RG9, which is Henley-on-Thames, where asking prices were reduced by £78,490 on average during the past year.
York, Wigan and Doncaster are the areas with the lowest reductions in asking price over the same period.
| Postcode (Area). | Average Asking Price | Avg. Avg. | Avg. Price Difference | Avg. Avg. | No. No. |
|---|---|---|---|---|---|
| SW3 (London). | £2,720,769 | £2,575,289 | -£145,480 | -5.49% | 26 |
| W8 (London). | £3,391,818 | £3,248,738 | -£143,080 | -4.31% | 22 |
| SW13 (London). | £1,445,208 | £1,359,694 | -£85,514 | -6.10% | 24 |
| NW7 (London). | £1,143,701 | £1,060,203 | -£83,498 | -7.58% | 37 |
| NW3 (London). | £1,992,965 | £1,910,578 | -£82,387 | -4.22% | 32 |
| W14 (London). | £1,245,192 | £1,165,404 | -£79,788 | -6.62% | 26 |
| RG9 (Henley-On-Thames). | £913,750 | £834,832 | -£78,918 | -9.03% | 40 |
| W2 (London). | £1,597,847 | £1,519,357 | -£78,490 | -5.04% | 21 |
| E8 (London). | £953,055 | £877,083 | -£75,972 | -8.30% | 18 |
| SW4 (London). | £1,211,488 | £1,140,979 | -£70,509 | -5.99% | 46 |
| Source: Property Solvers | |||||
Homes have sold for £11,000 less than their asking prices on average during the past year, according to new research
One estate agent in London said that the figures are fascinating because they highlight the “often-significant differences” between selling and asking prices.
Jeremy Leaf stated: “As the stamp duty deadline approached we noticed that buyers and sellers had to negotiate harder in order to get significant savings in some cases.
“The report also highlights the importance for buyers as well as sellers to determine value. Buyers and sellers should not only consider asking prices on portals like Rightmove but final selling price which appears, albeit slightly later, on the Land Registry site.
“Those differences could be due to the need for re-negotiation of previously agreed prices after surveys report on defects, especially in older houses.
| Postcode (Area). | Average Asking Price | Avg. Avg. | Avg. Price Difference | Avg. Avg. | No. No. |
|---|---|---|---|---|---|
| B37 (Birmingham). | £190,709 | £188,679 | -£2,030 | -1.07% | 21 |
| BD3 (Bradford). | £118,000 | £115,907 | -£2,093 | -1.79% | 16 |
| CH6 (Bagillt & Flint) | £148,906 | £146,775 | -£2,131 | -1.44% | 16 |
| DA2 (Dartford). | £436,111 | £433,917 | -£2,194 | -0.50% | 18 |
| WN3 (Wigan). | £167,303 | £165,019 | -£2,284 | -1.37% | 26 |
| L30 (Bootle). | £121,556 | £119,181 | -£2,375 | -1.97% | 16 |
| DN7 (Doncaster). | £149,033 | £146,648 | -£2,385 | -1.61% | 27 |
| DE1 (Derby) | £202,932 | £200,530 | -£2,402 | -1.19% | 17 |
| YO41 (York). | £340,250 | £337,813 | -£2,437 | -0.72% | 16 |
| WF16 (Heckmondwike). | £146,283 | £143,780 | -£2,503 | -1.73% | 15 |
| Source: Property Solvers | |||||
Ruban Selvanayagam explained that, despite the active market, homebuyers are still able to negotiate down prices.
“There is more evidence that surveyors are downvaluing properties that are not in line with reality. This can lead to properties selling for less than their original estate agent price estimate.
It is all relative. A more expensive property will be likely to have a greater price difference. However, it is worth checking how much the prices are dropping in your area before buying.
Buyers can use the asking price difference tool to see how prices are dropping in their area.
Mr Selvanayagam said: ‘For sellers before listing, we always recommend looking at the freely available data from HM Land Registry which tracks prices properties are sold for and is not what they are advertised to be.
Rightmove’s Tim Bannister said that there is sometimes a difference in the asking price and the final selling price of a home after negotiations between buyer and seller.
The biggest differences are often found at premium ends, where the seller may be more flexible about the final value that they are happy to accept. We provide buyers and sellers with the latest sold price information via the Land Registry and Registers of Scotland.
