Price Segments - the difference between a listing price and the final sales price

You've probably heard of it through the grapevine, and if you sold homes in your past then you've experienced this for yourself. Oftentimes, we find that our original listed price for our home doesn't always match the final selling price. Sometimes if we're lucky, we can make a little more, and other times, it feels as though we are losing out.

Why is this the case? What causes the property market to fluctuate so, and how can we use it to our advantage as a homeowner?

Exploring who owns the market

The property market is forever fluctuating and depending on how the economy is working, you may find yourself within either a buyer's or seller's market. 

In a seller's market, a homeowner will often find that they will have multiple offers on their home, giving them the opportunity to select an OTP that suits them best. In these situations, a final price that far exceeds that of the original listing is not uncommon.

Inversely, if you find yourself within a buyer's market, the degree of control you have over your home's final sale is now limited. Since buyers are now spoiled for choice in terms of homes on the market. Sellers may find themselves competing over a final sale regardless of whether it meets your preferences.

What factors lead to a buyers or seller's market?

Being able to accurately determine whether or not you are IN a buyer's or seller's market is half the battle. As we've said before, the property market is a dynamic and ever-evolving beast. Some of the key catalysts to determining the type of market environment of the time is looking at current market stats and key stakeholders within that space. Ie, affordability, political stability and the economy.

We are currently in a buyer's market

According to a financial report by FNB, the average price for property in South Africa has dropped for a second year running since the initial phases of lockdown with the latest Consumer Price Index (CPI) putting inflation at 4.5% (Statistica).

In brevity, this amounts to a 1.2% decline in property prices and can be attributed to the following factors:

• The Affordability Factor - When the average price for real estate is too high, consumer demand starts to dip, forcing homeowners to drop their prices.

• The Political Climate - Elections, political unrest, and policies that specifically affect property rights can significantly change the overall price of the property.

• Economic Recession - The instability of the economy will naturally slow the pace of the market. Stifling affordability and forcing homeowners to lower their prices.

Let's take a look at the stats

Ikonic Real Estate specifically focuses on selling homes within serene lifestyles estates such as Silver Lakes. When looking at homes within this specific category, we can break the pricing structure down to R5 million as a benchmark in order to highlight the difference in experience from high-end to more affordable homes. 

According to a year by year breakdown provided by Principal Practitioner, Martin Hayward, the pricing as a percentage of the marketing price for 2019 overall houses sold for 10.65% below the marketing price, 8.83% in 2020, and 11.24% in 2021.

Since 2019, it's clear that the average market price continues to outpace that of an individual homeowner placing us squarely within a buyer's market for the past 3 years.

Speak to an experienced Ikonic Real Estate Practitioner

One of the most crucial steps to take in determining the market and how to navigate its pitfalls is to speak to an experienced agent. They contain a mass of useful information and can provide meaningful solutions to pricing your property correctly, while also providing invaluable services along with the selling and buying journey.

"What is important is a proper market analysis before you put your home on the market. That will allocate whether or not you have a drop in the price, or whether you will gain more in the long run." - Martin Hayward.

For more details on statistics surrounding your own property or to discuss the medium to long-term trends, our principal is always happy to discuss and meet with homeowners to alleviate concerns.

Contact Ikonic Real Estate today

For Real Estate Practitioners you can trust, contact us below for more information.

If you are looking to live in Silver Lakes Estate, Willow Acres Estate, Six Fountains Estate, or Equestria Estate and surrounding areas then Ikonic Real Estate is your most experienced property professional to assist you in selling and buying.

Office Number: 083 452 5599

Cell Number: 083 452 5599

Email: martin@ikonic.co.za

Ikonic Real Estate holds a Fidelity Fund Certificate issued by the Property Practitioners Regulatory Authority.