Real estate investment opportunities are often characterised by their low price and potential to generate value and returns. However, getting a bargain in Britain's property market is certainly getting harder. This is especially true when it comes to residential investments. Research from Zoopla has revealed the proportion of properties for sale across the UK that have seen their asking price reduced has fallen significantly. As confidence increases among buyers and supply tightens, it seems values are only travelling upwards.
Only 31 per cent of properties on the market today have had their asking prices cut since first being listed, Zoopla figures show. This is down significantly from the 40 per cent recorded in November 2011. Investors looking for a bargain should stay away from London, where there is the lowest proportion of price reduced properties. Preston has the largest number of bargains in the market, while the average discount in greatest in Liverpool and smallest in Plymouth and Edinburgh.
Reductions in asking prices have also dropped over the last two years. In November 2011 properties were being sold at around 7.4 per cent off the original price. However, today the average reduction is just 6.4 per cent. Lawrence Hall of Zoopla said: "Confidence in the property market is at its highest level since the start of the economic downturn and this is reinforced with fewer sellers feeling the pressure to lower their expectations and drop prices."
The situation is unlikely to change either, with the New Year rush of buyers expected to make demand even more acute. Sellers' expectations for values are likely to increase, causing significant discounts to become few and far between. "The only thing that could upset the trend is if there is a significant rise in [the] level of stock coming to the market," Mr Hall said. For now, Yorkshire towns seem to be among the best bets for discounts, with Rotherham at 42 per cent, Wakefield and Barnsley at 41 per cent and Doncaster at 40 per cent.
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- Friday 15 November 2013