I remember very clearly when I was a student, a friend who was studying marketing trying to explain the economic theory of supply and demand to me. At that point it seemed counter-intuitive that as demand increases for a particular product so would price increase. Many years on and a lot of observation of what actually happens in a market place and I have come to completely accept that this is a true reflection of how we buy. A good example would be when a particular toy becomes the toy to have ahead of Christmas, demand outstrips supply and the price soars.
In other words, a product will be bought at its highest price very quickly, if it is desirable. A product which is less desirable will take longer to sell and will eventually be bought at a much lower price point. This has been evident in the property market for many years.
You will know that as you watch a particular property online, the longer it remains on the market with no buyer the price will be decreased to try to increase demand at a lower price. Those properties which are snapped up very quickly tend to be sold at, or even over, their original guide price. They are the ‘hot properties’, the agent has done a good job to get both the valuation and the marketing right from the outset and created a buzz which draws in multiple buyers who will compete and push up a price. This is generally a much more effective way of achieving a great sale than the more traditional British approach which has people saying to their agent ‘Well let’s try it at the highest value we can possibly justify. We’re not in a hurry so we can wait for the right buyer to come along’.
From a logical and economic perspective, it is very apparent that this approach is destined to failure and will only lead to frustration for all concerned, however, it is the way many vendors, and agents will approach the market.
We believe, along with many of the housing market analysts, that 2020 will see an increase in confidence in the market and a lot of people will decide to move having been waiting for the political uncertainty to settle. This is a great opportunity if you are one of those families who have been wondering what to do for the best for a while but, in reality, would like to see in the new year in 2021 in a new home.
Book in a free consultation with us as soon as you like and we can help you turn your own home into one of the ‘hot properties’ that sells quickly at the best possible price.