2024 – The Year of the Buyer

So the forecasts are all out and basically it looks like another year of 1m transactions and prices which are slightly rising or seeing small falls. Over the last few years, agents have needed to focus on getting stock – anything – because with demand so high, many have been relatively easy to sell and we work in an extremely competitive market.

In cooler markets though, things get very tricky very quickly for agents and indeed anyone working for buyers and sellers. A loss of an average of 17% of sales – and for some areas far more – is hard to deal with.

Buying a home is still a good idea!

When I put myself in the buyer’s world, most of this year I’ve been bombarded with bad news about buying a home, mostly around mortgages. To be fair to the media, they have definitely moved away from the ‘Armageddon’ forecasts of price falls we used to see in the past during times like these, mainly because this rhetoric has typically been wrong for some years now, but also because better data is provided which is giving journalists an improved understanding of the market.

So if I was a first-time buyer or a second stepper, I’d be pretty sure moving home, on top of a cost of living crisis, would be the last thing on my list of to-dos.

However, data from Zoopla tells us that one in two buyers have cash or mortgages with less than 50% Loan to Value.

We also know that first time buyers who we thought would collapse this year, haven’t, or at least hadn’t until base rates rose above 5%. We also know from Nationwide and other indices that buyers have continued to purchase, even with higher mortgage rates, partly by looking at “smaller, less expensive properties” and as such, property types such as flats have sold quite well versus other types.

So there are still buyers out there and there would probably be more of them if we can find ways of explaining why it can be a good time to buy. For example, buying currently, for those that afford to, can be a much less stressful process and indeed mean they get a property for a decent price, rather than the frothy prices we have seen over the last few months.

Those that are buying under £250,000 also don’t have to worry about paying SDLT in England or N. Ireland until the end of March 2025. This won’t necessarily save buyers much, but there is an emotion attached to not having to pay any Stamp Duty at all and this could help bring forward some purchases.

For me, surviving another year of low transactions is all about understanding who can buy locally and what it is they want.

Bungalows are back

Some interesting data from Chris Watkin and TwentyEA shows that the type of property most likely to sell is a Bungalow – which has a 66% chance of selling, likely to be to a cash buyer, followed by houses at just under 60% and although flats are doing better than they have in the last few years, the chance they will sell is just under 55%.

Understanding which type of buyers are active, what price brackets are the most popular, along with which property type can help to make sure you secure not just any instruction, but an instruction that is most likely to sell, is crucial to surviving another slow year. Saying no to properties with poor buyer demand, or to sellers that don’t price realistically or aren’t engaged enough in the process isn’t easy, but it could be a good way to ensure the sales you take on are profitable.

Finally, there is a massive opportunity for the best agents to really separate themselves from others and that is to work with local media and buyers and sellers to explain the new Material Information required.

This needn’t involve a lot of work as NTSELAT have produced some great consumer guides and sending these, with your thoughts, could lead to a superb piece in the local media which can help promote you and your company for free.

And finally, we have suggestions in the Discussion Paper from the Home Buying and Selling Group to reduce fall throughs and the time it takes to buy and sell. These include instructing a legal company from day one of marketing, or before, making sure the seller is ‘ready’ as soon as an offer comes in; providing the material information and other PIQs to buyers so they have a better idea of what they are buying and then sending this to legal companies and/or surveyors along with the memorandum of sale and finally making sure everyone is ready to move by 1pm on the day of completion.

2024 will be another tough year for the industry, but it could also be one of the best years for working out what instructions are profitable, how to reduce fall throughs after the offer stage and the time it takes to sell a property. Focusing on these things could have the biggest positive impact on running a property business not just next year, but in the future.