Concerns of a post-pandemic property price crash have been looming over the market with worries that some purchasers may try to get ahead and seek reduced prices.
So this week, Mortgage Solutions is asking: When proceeding with paused applications, are your clients sticking to the original agreed house price?
In the main, we have seen our clients stick to the agreed sale price. There have been a few exceptions, but overwhelmingly people have stuck to the original value.
Where people have renegotiated the price, it tends to be around the five per cent mark from what was agreed initially.
There are various reasons for that but mostly it is a hedge against any short-term dip in prices. I saw that in the April survey of its members, the Royal Institution of Chartered Surveyors stated that 40 per cent of its members expected prices to fall by four per cent.
As the people valuing the property that is a pretty good benchmark to go by.
However, whenever a client asks for advice in this area, I always point out two aspects; if it were you how would you feel? And what is your basis for doing this?
As I say, it is down to the individual to decide what is best for them, and moreover, the vendor does not have to entertain the lower figure anyway.
I have never entered into too much guidance on house prices to our clients. Partly as the property market is so large and varied there is no way I can know if it is a fair price or not.
But in a more philosophical sense, something is ultimately worth what someone is willing to pay for it – that is what the market is there for.