During the years of uncertainty and global recession, people not only in the Redditch or Bromsgrove areas, but people all over the world decided to batten down the hatches and ride out the storm.
Homeowners waited for house prices to recover. They didn’t readily want to move house for various reasons including the fear factor around their job stability or just simply because the drop in prices meant that they didn’t have enough deposit to buy a bigger property.
However, recently we are seeing a new phenomenon in the housing market. House prices in most areas in Redditch and Bromsgrove are back to or in some cases even higher than pre-recessionary levels, but the property stock levels across most high street estate agents are worryingly low. So this raises a very important question and that is why?
Why Are People Reluctant To Put Their Homes On The Market And Make The Move?
One explanation is very concerning! When speaking to prospective sellers some have actually given the response that they feel as the market and economy strengthens their property value will further go up! When asked what their future moving plans are, they usually reply that they will be looking into buying a bigger or more expensive property i.e. moving up the property ladder. This raises the most important point in ‘what is a dry market for available properties?’
Let's consider an example of a Mr and Mrs Smith who own a terraced house in Redditch worth around £100,000. They are looking to move up the ladder to a semi-detached house in Bromsgrove worth around £200,000. This means that they need to bridge a £100,000 gap in order to move from their current residence to their new dream home.
Now let’s suppose that Mr and Mrs Smith decide to hold off putting their house on the market for sale, expecting their Redditch home to further increase in value. Let’s assume that Mr and Mrs Smith are right and the market value increases by a further 10%, Mr and Mrs Smith have now got a terraced property in Redditch worth around £110,000. But the question is that have they really gained an extra £10,000? Technically no, they have not gained even a penny by waiting instead their dream semi-detached house in Bromsgrove has now also gone up by 10% with the increase in market value. They will now have to pay £220,000 for their onward purchase. This means that Mr & Mrs Smith will now need £110,000 to bridge that gap!
Even though their property in Redditch has increased in value by £10,000, yet they actually lost £10,000 by waiting for the market value to further increase, as the bigger property that they were looking to buy also increased in value.
Until sellers are educated with this fundamental market logic, there will continue to be a shortage in the properties available for sale. In our opinion, NOW is really a good time to sell property especially if you are upsizing.
So, if you have been considering to move up the property ladder, then you could really benefit from speaking to AP Morgan, your leading local Estate Agents in Redditch and Bromsgrove.
Please ask to arrange a FREE and No-obligation Market Appraisal of your property, where you will be provided with an up-to-date valuation of your property and an insight into the local property values and trends as well as the best possible advice on moving house under your own personal circumstances.