Is Black Friday coming to the property market?
20 November 2018
By Andi Michael
Can first time buyers benefit from property price drops?
With Rightmove reporting
that the drop in property prices has been the largest since November 2012 – is it a good time to get a bargain?
Well, yes and no.
With Brexit uncertainty lowering the number of sales, sellers are lowering their prices to make them more ‘realistic’. Properties that have been listed for quite some time need a shake up, and a price drop is the easiest way to make them more attractive.
This is great news for first time buyers, who are prime to take advantage of a great deal. With no home to sell on, they’re not suffering from the price drops, and they may be able to get a better home for their budget.
However, it’s worth considering what type of properties are dropping in price.
The biggest falls in price were in London (-1.7%) and the South East (-2.1%), with the average price drop across the country amounting to around £5000.
It’s rare for London and the South East to drop in price, but when you start to look at the high end commuter towns that have had the biggest annual discount (Rickmansworth, Esher and Gerrards Cross) it becomes unlikely that these would be choices for first time buyers. Even with a price drop, it’s more expensive properties that are lowering.
Our data shows a similar trend, usually looking at the prices of properties that have been agreed, rather than the asking price. From October to November 2018, the price of properties in London dropped by 5%, South East dropped by 6% and the Midlands dropped by 7%.
So where does this leave buyers in search of a deal?
If first time buyers have been searching but haven’t found anything in their price range, more opportunities may appear. It also means that as price drops become more expected in the current market, making a lower offer on a property you like may yield greater results.
If you haven’t been considering buying, it may also now be worth looking at what’s available and within budget – you may have more options than you think. You can use MousePrice
to register for changes to house prices in your chosen area.
Have a look at our first time buyers guide
for more information about choosing your first home, or check our property viewing checklist
if you’ve already booked a viewing!
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