Garrington Property Finders: The price of paying too much

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With areas changing in popularity and prices moving rapidly, the property market has become somewhat of a minefield for buyers to navigate - Credit: Copyright (c) 2021 Martin Hibberd/Shutterstock

Jonathan Hopper, property expert at Garrington Property Finders, highlights some of the risks facing buyers in the current property market

Regardless of what you are spending your money on, nobody wants to buy something today, only to find afterwards they could have bought it cheaper. This is acutely the case when it comes to property, which for most people will be the most expensive item they will ever purchase.

With areas changing in popularity and prices moving rapidly, the market has become somewhat of a minefield for buyers to navigate and have confidence they are buying the best property at the best possible price.

A distorted market

Around the UK, there is a continued shortage of homes for sale. Average property prices have grown over the past 12 months and some sellers, and their agents, are pricing at very optimistic levels in the hope that a desperate buyer, facing the chronic lack of choice, will pay what is required to secure a purchase.

While any home is generally worth what somebody is willing to pay, there is an important difference between paying a ‘full price’ and a ‘high price’. In the current climate, there is an increasing risk of frustrated buyers making purchasing decisions led by their ‘hearts’ not their ‘heads’ and this can lead to the expensive mistake of paying too much for a home.

Is it ever worth paying a premium?

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In a market lacking choice, paying a full price for a property may be your only option, but is it ever a good idea? The answer is – it depends. Certain types of properties are always going to be in short supply in any market and, as such, will always achieve strong prices due to the scarcity value attached to the type of property or the specific location they enjoy. However, these are the exception, not the norm. If you are paying a premium price, it is usually only worth doing this if you are sure that the home you are acquiring truly is ‘best in class’; therefore, the premium paid at the time of purchase should still apply when you eventually come to sell it again.

Someone on your side

Most transactions in the UK still take place through estate agents, and when it comes to discussing an offer for a property, most buyers will be negotiating through the agent – an experienced professional. Many buyers lose sight of the fact that estate agents are ultimately working in the sellers’ best interests, not the buyers and, as such, their usual mandate will be to sell a home for as much money as possible.

In a changing property market, forming sound purchasing decisions is a complex challenge. Buyers need to think about how they are approaching their moving plans and may benefit from seeking independent advice. Before starting a property search and negotiations, having a circle of trusted advisers such as a solicitor, surveyor and property finder can be hugely beneficial. It ensures you receive objective advice from people working in your best interest who can, in turn, give you the clarity and confidence that the price you are paying is not too much.

To learn more about how Garrington can help save you time and money please visit garrington.co.uk.