If you are experiencing frustration selling your house, you have probably asked yourself, do all houses sell eventually? There is no simple answer to this question. Much of the information lies in the hands of estate agents who are reluctant to highlight failures.
In reality, there are many different reasons why a house sale may fall through. However, if you’re prepared to accept the “real market price”, your house will eventually sell. In this article, we will look at factors affecting house sales and consider the answer to the question, do all houses sell eventually?
The property market and house sales
Before we look at reasons why houses may not sell, it is essential to appreciate the size of the UK housing market. In a report by estate agent Savills, the market was valued at £8.68 trillion at the end of 2022, with outstanding mortgage debt of £1.66 trillion. This means that the net housing wealth of the UK is more than £7 trillion. A huge market!
Many factors will influence the sale of a house, such as:-
Location, location, location
The location of any property will significantly impact the chances of a quick sale and the number of failed agreements. The percentage of deals falling through varies considerably across the country. The following table shows the chances of a deal falling through region by region:-
Source: Home Selling Expert
Condition of the property
There is a natural temptation to improve the condition of your home before a sale. This is perfectly understandable, but it is crucial to appreciate the cost of any improvements against the potential increase in the sale price. Also consider whether an increase in price would turn buyers away.
You can take many relatively inexpensive actions, such as painting and tidying the garden. However, it can become counterproductive when you get into more complex issues.
Here at Cash House, we buy various houses in different locations, price ranges, and, more importantly, conditions. We are transparent and upfront about our calculations on value and our offers. Consequently, we buy many homes that need significant work/renovations while others are ready for the rental or sales market. If you are considering selling your house but are struggling to fund any improvements, don’t hesitate to contact us to get a quote now, and we can discuss the options.
We will cover the challenges of pricing your property later in this article. Suffice it to say it is critical and you can’t beat the market. If you are pricing your property above the general market value in your area, then, in comparative terms, other properties will look cheaper. Hence, they will attract more attention and a greater likelihood of a sale.
The role of the modern-day estate agent has changed dramatically in recent years due to the online revolution. There are thousands of websites where you can advertise your property at a relatively modest cost compared to estate agent fees. However, many of these websites provide little in the way of additional assistance, which is where you need to consider the value of an estate agent.
Many estate agents will have a list of potential buyers waiting for appropriate properties to come to the market. Consequently, if your home is located in a much sought-after area and at a reasonable price, you may be able to secure a quick sale with the help of an estate agent. There is a lot to consider, but the role of an estate agent is undoubtedly still alive – although there is competition.
Common reasons for delayed sales
We will now look into some of the fundamental reasons that may delay or prevent house sales and answer the question, do all houses sell eventually. Some of the most common causes include:-
Overpricing your property
As we touched on above, when putting your house up for sale, the market should dictate the price, not the seller. If you have overpriced your property on the initial listing and are forced to reduce the price later, you may miss your optimum exposure to buyers. Therefore, getting the listing price at the right level is vital, while also suggesting a degree of flexibility.
If there are more buyers than sellers, then you may be able to agree a premium to your listing price. On the flip side, where there are more sellers than buyers, perhaps the market has turned down, you may need to reduce your price or accept a discounted offer.
The economy significantly influences the UK housing market, with interest rate movements especially critical. If the economy is overheating, we tend to experience increased interest rates, increasing the cost of debt (in this case, mortgages) to cool down the overall economy. Once the economy turns down, relative spending power tends to come under pressure, and the affordability factor may prompt delays in housing sales.
The importance of pricing
Fear and greed are two strong emotions that can significantly influence the listing price for any house. While it is essential to be competitive, you don’t want to give your property away, but if time is of the essence, you may have to accept a discount. So, from those two little words, fear/greed come a variety of different issues to consider.
When looking at the quandary of “Do all houses sell eventually?” the truth is that they will sell at the right price. You may need to reduce your initial price if there is a lack of interest, visitors and eventual offers. While it may be incorrect to say you don’t get a second chance to make a first impression, the first few days (or couple of weeks) of your listing are likely to attract the most interest. If you get the price right at that time, you may be onto a winner!
Critical tip: Consider the listing price of similar properties in your area and, perhaps more importantly, those which have sold.
Interesting case study
When looking at the price of houses, many will be drawn towards those “unbelievable offers” of just 1 pound for a house. We have seen several schemes across the UK. However, one in Liverpool was particularly successful, even if the devil was in the detail.
Housing stock: 6000 empty, dilapidated properties for just 1 pound each
Was there a catch?
Those who bought the properties had to agree to:-
• Spend at least £40,000 on home improvements in the first 12 months
• Keep the property for a minimum of five years
Considering that many of these properties needed electricity and/or planning permission, potential buyers had many challenges to overcome. Those who were realistic with regards to the obligations attached to a 1 pound property purchase made significant returns. A number of the properties were later listed/valued at more than £70,000 – creating substantial profits for those who took a chance.
Compromising on price
While the above one-pound sale schemes are a lot more common than you might expect, they are still relatively small in the overall context of the housing market.
We know that being able to compromise on price makes your sale more likely to go through successfully. But, part of the reason why a third of sales don’t complete is because the majority of buyers aren’t willing to be flexible. How flexible buyers are with their price is shown below:-
Source: House Selling Expert
While these figures will vary at different times of the year and in different economic environments, they give you an idea of what to expect, especially if you get the pricing wrong.
When looking at a marketing sales strategy for your home, there are some interesting statistics available today:-
- Where there is no chain, there is a 24% chance of a sale falling through
- Where there are two houses, there is a 42% chance
- Three houses in the chain and this increases to 56%
Some of the most common reasons for a house sale to fall through include:-
- Change of heart/circumstances
- Broken chain
- Finance problems
- Conveyancing issues/delays
- Problems with the Home Survey
The situation is different if you look away from the traditional housing market towards auctions/cash buyers.
As a cash buyer, Cash House will provide an indicative price, confirm the price and transact at that price. We also cover the costs on both sides of the transaction. We are fair and transparent about the process and the potential cost savings of an early settlement cash sale.
Conclusion: Do all houses sell eventually?
When asked the question, do all houses sell eventually; there is no hard and fast answer. A better question may be: do all owners sell eventually – as the seller’s choices and flexibility impact the sale just as much as the property itself.
The reality is that if you want to sell your property, price is the key. It is up to the seller what offers they will consider. Whether you list your property at £200,000, £500,000 or £1 million, you can expect to receive below listing price offers from day one. Many of these will be opportunistic investors looking for a “cheap deal”. While others will be serious bidders, perhaps open to negotiation.
It is important to research the local market and price your property accordingly. You should also be flexible where offers are there or thereabouts. If the buyer is serious there is no reason why you can’t agree a sale.
You may experience issues where a deal falls through for reasons outside your control. This doesn’t necessarily mean your pricing is wrong. Be realistic, but fight your corner and be appreciative of the market. Also be willing to be flexible in light of changes in the economy/sector.