A house-seller in Wombourne decided to take an unusual approach to selling his home, in order to stand out from the crowd. He pledged to cut the selling price by £1,000 for every week that it was on the market. The odd idea apparently resulted in a sale after just three weeks - so should we all give it a try?
According to the Express and Star, the owner had put his two-bed retirement flat on the market for £145,000 at the start of April, and three weeks later the estate agent confirmed that it had sold - although he did not say how much the offer was for.
It was already a great deal, as sales of one-bedroom flats in the same retirement complex had ranged between £150,000 and £174,000 in the previous 18 months - so this sale offered two bedrooms for less than the price of one.
Would it work for you?
The strategy certainly helped this property stand out. It also secured a sale, presumably from a buyer who saw the opportunity to snap up a bargain. By reducing the price weekly, he was always going to find the point at which the property would sell.
Another advantage of this approach is that each week that you drop the price, the property will fall into the price bracket for a new group of house-hunters. The way that online search engines work means that someone searching just £1 under your asking price will not see your property. This pricing strategy means that the following week, they would.
However, before anyone else gives it a go, it's worth considering the drawbacks.
First, it doesn't give you a particularly strong hand in negotiations. A buyer can come in with an offer £10,000 under the asking price, arguing that if you wait 10 weeks, it'll be this price anyway, and in the interim you will have faced all the bother and uncertainty associated with having your house on the market.
Second, market theory shows us that we are actively making buying a property less attractive when we drop the price. Technically when prices are dropping it encourages us to hold off for as long as possible, because we know it will be cheaper the following week, or the week after that.
And third, psychologically we are put off by the idea of buying something that is dropping in value. This may only be a notional price drop, but all house prices are merely notional, so it feels as real to us as any house value.
If you want your property to stand out, there are other ways of doing it - and people have tried all sorts of approaches.
We reported yesterday on the woman from Blackheath who is raffling her £1.25 million Blackheath home, for just £5 a ticket.
You can have a bit of fun with the pictures, like the owner who dressed as a parrot and appeared in every photo. It was one of the most viewed houses so far in 2017, so it definitely attracted attention.
Alternatively, you could join the small numbers of sellers who throw in something attractive with the purchase. This is usually a desirable car or an expensive membership (like a gym or golf club), but in one instance in Indonesia, a woman also offered herself as a 'free wife' for any buyer.
However, the experts say it's worth standing out for far more boring reasons instead. If your home is well maintained, cleaned, decluttered (remove about half of everything you own), brilliantly photographed, and sensibly priced, then you have maximised your chances of a sale.
You don't have to be the cheapest on the market. You don't need a gimmick, you just need to make the most of your home, and trust that the right buyer will come along.
10 things that add value to homes in an area
10 things that add value to homes in an area
A view out over the park isn’t just a nice bonus, it’s a valuable asset. A study by Marsh & Parsons has found that a park view can add up to 10% to a property's asking price.
It carried out its research in London, where it found that a view over Warwick Square in Pimlico added £75,000 to the asking price of a one-bedroom apartment.
Understandably, this is largely a London phenomenon, where the vast majority of train-based commuting takes place in the UK.
The Nationwide Building Society found that being 500m from a station would add 10.5% to the value of a property in London. In Manchester it fetched a 4.6% premium and in Glasgow 6%.
The researchers found that the closer the property was, the higher the premium would be - until the proximity of the station started having an impact on the area itself.
Having a Tesco, Sainsburys, Waitrose, Marks and Spencer or the Co-operative within striking difference, will add value to your property. In fact, a survey by Lloyds claimed that it would add 7% - or just over £15,000.
However, apparently what we all really want is a Waitrose, because the same study found that having a branch nearby added almost £39,000 - or 12% to the value of the property.
The way the survey was carried out, however, doesn't make it clear whether this is a reflection of the attraction of the supermarket itself, or whether the supermarkets tend to target affluent areas with expensive houses.
People will pay 12% more to live in a market town than they will for the same property in the surrounding countryside. The findings come from Lloyds Bank, which claimed the towns offered a balance between country life and community spirit that proved irresistible to buyers.
It added that in some market towns the mark-up was even larger, with Beaconsfield in the South East attracting a 156% premium over the surrounding area.
A study by the London School of Economics found that living in a conservation area adds 23% to the value of your home. Given that this was an academic study, the researchers went even further and adjusted the results based on the kinds of properties in the area, and other aspects of the location (which none of the other studies took into consideration), and it still found an uplift of 9%.
Being near a good school will add 28% to the value of your home - according to Savills - with parents calculating that it’s cheaper to move into the catchment area of a good school and pay anything up to £100,000 more for their property than fork out for years of extortionate private education.
A study a few years ago by Zoopla discovered that living on a road with ‘Hill’ or ‘Lane’ in its name meant your property was likely to be 50% more valuable than the national average.
Those with ‘Mews’, ‘Park’ and 'Green’ in their names were also more valuable.
It’s unlikely that there’s any element of cause and effect here: instead they are by-products of the same thing. Expensive houses have always been built in the more exclusive parts of town, including the hills and the quiet ‘lanes’ around those hills.
A survey by Primelocation claimed that being near a top golf course would add 56% to the value of your property. It added that prices were also rising faster near golf courses than elsewhere in the country.
Of course, there’s a chance that the results were impacted by the fact that many of the courses are in leafy and exclusive areas, where people pay a premium to live regardless of the course.
You’d have thought the threat of flooding would make people take to the hills, but it appears we’re still happy to pay a premium to be beside the sea.
The Knight Frank Waterfront Index found that overlooking an estuary adds an average of 85% to the price of a property, a harbour adds 83%, while the coastline in general adds 56% to the value of the property. If you have a mooring, that’s even better, as it adds 104% to the value of your home.
Despite all the bad press surrounding flood plains and rivers breaking their banks, being near a river is actually more valuable than being by the sea.
The Knight Frank Waterside Index claims it adds 57% to the value of your property - making it the most valuable asset to have in the neighbourhood.