Price correction?

Firstly, let me explain my frustration at the term “UK Property Market”. Looking at the whole of the UK property market and then making statements similar to “UK house prices predicted to fall by 12%”, or “15%”, or “17%” are misleading at best.

I get it, the Press need to create headlines that make us gasp and keep us glued to our seats but come on, every corner of this land has its own little property universe so generalising to this extent is pointless. It's like saying all cats are the same, and about as accurate as me attempting to predicting the weather pattern for summer 2024.

In my view, we are only witnessing a property price correction, which is no great surprise given the madness of 2021.

The definition of a property price correction is a milder and more manageable adjustment in property prices that occurs as a regular part of the market cycle - between a 5% - 10% reduction. It is generally considered a healthy and necessary process to maintain market stability. On the other hand, a housing market crash is a severe and sudden downturn that can have serious economic consequences and disrupt the entire real estate market and financial system. Crashes are relatively rare but have a more profound and lasting impact on the economy, and of course, people's lives.

Now let’s have a look at the Worcestershire property market “universe” for a moment…
According to Rightmove, from the 1st May 2023 – 26th July 2023 price reductions across Worcestershire averaged 5%. Sellers with reductions of around 2% have, no doubt, had to reduce further before an offer was agreed. Based on my own research conducted over the past few days, all indicators seem to align with a price reduction of approximately 5%, indicating a clear case of a "price correction" scenario.

So, what are buyers up to these days? Our first hand experience confirms there are a considerable number of potential buyers actively engaging in the market. However, considering the impact of increased mortgage rates and cost of living, buyers are exercising caution to ensure that their prospective purchase remains financially feasible.

Let us calmly explore the conclusion derived from these insights. In my opinion, we are witnessing a property price correction driven by unsustainable price levels 18 months ago, increased mortgage rates and the cost of living. Buyers are plentiful, but cautious. The market remains in a good state and as long as properties are pitched at a sensible level then they will, and do, sell.

It is vital for your chosen estate agent to possess an in-depth comprehension of the local market conditions, and for them to be honest with you about it. By setting realistic marketing prices, they lay the foundation for achieving a successful sale.