Two-fifths of UK sellers are accepting discounts of more than 5 per cent on the asking price of their property, reflecting the impact of rocketing mortgage rates and the wider cost of living crisis, according to property website Zoopla.
In the past two weeks, 42 per cent of owners accepted at least that level of discount to push a sale through, the research found, a sharp rise on the year-to-date average of 35 per cent. It predicted that sellers would increasingly accept bigger discounts over the summer, traditionally a quieter time in the housing market.
The recent surge in mortgage rates has “spooked” buyers and forced sellers to compromise on price, said Zoopla’s research director Richard Donnell. “This is a signal that buyers are becoming more price-conscious. Sellers are becoming more realistic.”
The analysis looked at the impact of mortgage rates increasing from 4 to 5 per cent on a purchaser with a 75 per cent loan-to-value mortgage and concluded it cut their buying power by 11 per cent. This figure jumps to 20 per cent on a 2-point rise in mortgage rates to 6 per cent.
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Source: www.ft.com
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