What Determines the Price of your Home?
Guest blog by Gavin Pike MNAEA – Senior Sales Partner, Martin & Co Witney
Ask any economics student what determines price and the instant answer will be ‘supply and demand’. This is as true for housing as is for anything else from crude oil to bitcoin.
Critically for the house seller, some of these factors are beyond your control whilst others can be made to work in your favour.
One of the reasons prices are so high is that a very small percentage of the housing stock is available at any one time. Last year less than 4.24% of Oxfordshire’s housing stock was sold. In other words, any one Oxfordshire home comes to the market on average every 23½ years!
Looking at our home town of Witney, we have analysed the numbers of properties available for sale in OX28 as at 1st March this year compared to exactly a year ago. The figures vary slightly according to property type, but overall show a modest increase in supply of about 4.7%.
Yet when we look at the numbers of viewings we conducted in these months (as a measure of demand), the March 2018 figures are 256% higher than in the same period last year.
So, how best to capitalize on this upward push on prices? The on line marketing of property is becoming an increasingly important element of achieving a good sale price. It is vital that your chosen agent does not skimp on this aspect. You should ensure that in addition to using Rightmove, they should also use Zoopla. This gives access to the property sections of several other sites (including national newspapers). Other more recent (cheaper) portals have simply failed to obtain the traction needed to make a difference.
A common misconception is that there is parity between agents that use the same portal. Professional agents constantly monitor the ‘click through rate’ of properties they are marketing. The higher this is, the more effective the marketing is- increasing the critical demand side of the equation and therefore ensuring that the best possible price is achieved.
Utilising expensive options such as Featured and Premium Listings help as do professional photographs, 3D floorplan and engaging write ups that point out why your home needs to be viewed ahead of its competitors. Our campaigns on social media have a noticeable impact and drive traffic to these sites.
The graph below is available to all agents who advertise on Rightmove. It shows the individual performance of the property in question (thick green line) against the average of all of the agents’ listings (the thin grey line). The difference between the green line and the grey line is telling. The marketing of this property is noticeably superior – attracting far higher interest that will dramatically improve the chances of an early sale at a good price! We regularly send these graphs to our clients and if your agent does not you may wonder why…
This is not an isolated result. On the day of writing this article I opened up our Rightmove ‘dashboard’. Whilst we have blurred the addresses to respect the privacy of our clients, it is clear that our marketing is demonstrably more effective! The power of the Featured Listing combined with a Premium Listing is impressive.
So a critical factor that affects the demand and therefore the price of your home or investment is choosing and an agent that markets effectively. And given the rate of house price inflation you may be pleasantly surprised to learn the current value of your home. Our online valuation tool will give you a figure in seconds! Why not try it out at martinco.com?