Sellers must get realistic about what their proper

By Heather Rose
Posted: 2008/12/17

As a result of the dramatic changes in the economy recently, house prices across the board have fallen by 20 per cent

House sellers should be realistic about their property's price. If they are, it could be a major step forward in bringing confidence back to the market and lead to deals being completed more speedily.

That is the view of John Coleman, head of residential in Scotland with international property consultants Knight Frank. What he describes as property value correction is now nearing its new level, he says, and if sellers accept this it will aid market recovery.

While prices may have soared last year, during recent months there has, explains Mr Coleman, been a market correction of 15 to 20 per cent.

"Those selling, particularly at the top end of the residential market, need to get real about what their property will achieve in order to bring confidence back into the market, " said Mr Coleman.

"There does now seem to be general acceptance of this, which should translate into more deals completing.

"Prices peaked in 2007 when they achieved an inflated high, driven by a shortage of supply, easy credit and specification.

"There is now more property to choose from and we are urging prospective sellers not to expect theirs to achieve what it might have done then.

"Being sensible about the starting price will encourage interest and maybe even competition so sellers must lower their expectations by at least 15, if not 20, per cent.

"If this happens across the board, coupled with market movement further down the ladder, this will bring new life and speed recovery."

This market correction means a house which would have achieved around £750,000 last year, is now more likely to achieve a figure of about £600,000. "We all need to inject some realism. That way we can lift the market back on its feet, get ahead of the curve, and force a revival, " he said.

"If we don't we will only encourage increased inertia and frustration." All levels of the market are in the same boat, he pointed out.

Every sector is seeing value reductions so, whether the seller is stepping up the ownership ladder or downsizing, the price differential will be relative.

Not only that, putting those plans to move home on hold in the hope prices might drop even more could prove a waste of time.

The consultancy reckons that even if prices do drop in the near future, the fall is likely to be only small compared to recent falls.

Information: 0131 220 9600; www.knightfrank.com