Dorset Property Market Update - October 2023

Edwards - Area Guides

By Grant Brooks – MD Edwards Estate Agents

October 2023 Dorset Property Market Update from Edwards Estate Agents

We Brits are fascinated by property, no more so than here in Dorset, helping local people understand the property market is something I’m asked to do most days, and not necessarily just those thinking of a home move, bumping into people on the street, in the deli getting lunch or even out having dinner, people want the inside line on what’s happening with their property.

Being cornered into providing an on the spot overview of specific properties isn’t easy, as the reality is that the property market fluctuates and at an individual level, price can often be influenced more by a buyer’s personal circumstances rather than traditional market drivers, particularly in a buyers market.

A first-time buyer will look at the market in an entirely different way to a downsizer, as the first-time buyer almost certainly requires a hefty mortgage and a downsizer will generally be mortgage free.

Every buyer’s personal circumstances will determine how they see the market and the price they are prepared or are able to offer on a property. So providing an accurate overview to a would be seller is not so straightforward, and requires a more thorough approach, taking all of the many variables into account before offering any advice.

There are of course some underlying truths that affect us all, number one, is that even the most optimistic cannot fail to acknowledge that the property market is seeing a correction from last year’s market frenzy, as the Bank of England’s interest rate increases seem to be having the desired effect of slowing inflation.

The higher interest rates are of course a concern for buyers requiring finance, although it is perhaps the impact of the rise in the cost of living, fuelled in no small part by an overly pessimistic media, that is causing the biggest knock to buyer confidence in the property market.

The Dorst Property Market

If you are a homeowner considering a home move in and around the Dorset area, but currently sitting on the fence, you are not alone. There is a good deal of uncertainty around both the property and economic markets.

Although, despite the economic pressures, a good many people are still moving home, first-time buyers will always want to get their foot on the property ladder, this in turn enables the second steppers to get moving and this progressively frees up the rest of the market.

Indeed it is currently the first-time buyer market that is currently the most active, and as long as entery level properties are marketed at a sensible price, they are selling fairly quickly.

It is property owners who find the current market the most challenging, certainly those who remember the frenzied seller’s market of last year. Owners that struggle to adjust their price expectations to match current activity levels are finding that their homes generate little viewing interest and are often left unsold without any buyer interest.

The recent House Price Index report from Rightmove, offers similar interesting insights –

The report leaves no room for doubt by very clearly stating that ‘sellers need to capture attention with a competitive price from the first day of marketing, as starting too high and reducing later damages the chances of a sale.’

This is what the data says –

The number of buyers enquiring about each available home for sale is 8% higher than the more normal market of 2019
Importance of immediate buyer interest: if a property receives its first buyer enquiry on the first day of marketing rather than after two weeks, then Rightmove data shows that it is 60% more likely to find a buyer
The proportion of homes that are finding a buyer has dropped from eight in every ten at the height of the frenzy, to a more subdued sales rate of six in every ten, making pricing competitively more critical to really stand out

Mortgages

Average fixed mortgage rates have now fallen for 11 consecutive weeks, with the average two-year fixed rate now below 6% for the first time since June, and the average five-year fixed rate dropping from 6.08% 11 weeks ago to the current 5.43%.

It is more important than ever to shop around for the best deals, and remember that not all deals are advertised, some of the best deals are only available from mortgage brokers.

Advice to Dorset homeowners

Homeowners considering marketing their home must think carefully about the asking price they set on their property, as confirmed by Rightmove, setting a realistic asking price on day one is critical. There are plenty of motivated buyers looking to buy, but price is a significant factor in their decision making.