The house price haggle is back – here's how to beat it

House price discounts are back as sellers concede that the property market has passed its peak.

A chronic shortage of supply in the wake of the pandemic property boom meant that bidding wars became the norm. But now rising supply and growing fears of house price falls mean home buyers have regained negotiating power.

Back in March, the share of agents reporting that most of their listings sold below asking price was just 15pc, according to Propertymark, a trade body. By July, this had more than doubled to 36pc.

This level was still low by pre-pandemic standards – from 2014 to 2019, the share was 75pc. But the trajectory is clear. Last month, the proportion of homes selling with price reductions of 5pc or more hit the highest level in any July since 2019, according to data from property website Zoopla.

Last year, just 5.1pc of homes sold with discounts of at least 5pc. In July, that share jumped to 6.3pc.

John Andrews, of Doolittle & Dalley estate agents in Worcestershire, said: “Until three or four months ago, we were seeing properties go for 10pc, 15pc, or 20pc above asking price. Since then we have seen the market ease back, and we have not been getting the same volume of inquiries. In the past month or so, we have been selling properties at asking price, or close to it.”

Buyers have been hit by higher mortgage rates and are also worried about how much interest could be in the future when they need to refinance, Mr Andrew said. “And they have less disposable income to spend.”

Nationally, the Zoopla data shows the share of homes selling with reductions of 5pc or more was still below the 7.1pc benchmark recorded in 2019. But in Wales – which has recorded some of the most extreme house price growth during the boom – the share of homes selling with 5pc discounts jumped from 4.7pc to 6.5pc.

Aneisha Beveridge, of Hamptons estate agents, said: “The regions that have been performing strongest are now cooling quickest.”

When Rosie Wood, 29, and her husband started looking for their first home earlier this year, they were often advised by estate agents to offer over asking price.

“We were looking at homes at the £325,000 mark and we were being told that the sellers were looking for £330,000 or £340,000 – £15,000 over asking,” Mrs Wood said.

“I think they wanted a bidding war, but it is just not happening in London,” she said. Instead, the Woods negotiated a £6,250 discount.

The couple started their house hunt after their landlord decided to sell – and also took a hit on asking price. “He put the property up for £575,000 and it has sold for £525,000,” Mrs Woods said – a discount of nearly 9pc.

Supply is rising after a years-long dearth. Roger Punch, of Marchand Petit estate agents in South Devon, said: “It feels like we are seeing about double the number of properties coming to the market this month than we would normally expect at this time of year. It is very unusual in August. Normally we would expect to see it in September, but this started in July.”

Sellers may be calling the peak of the market, Mr Punch said. “The question mark over the economy means that confidence is starting to wane. We are seeing far fewer immediate inquiries when we list a property, and the market doesn’t move so quickly. Guide prices are starting to be adjusted.”

Jeffrey Hazel, of Geoffrey Collings & Co estate agents in Norfolk, said: “Demand is still strong but buyers are now negotiating harder.”

Mark Annett, of Mark Annett & Company estate agents in the Cotswolds, said sellers who had assumed they could continue raising prices appear to have hit a ceiling. “There are signs of price reductions where vendors have been racking up asking prices over and beyond what the market will bear.”

The North East and the South East were home to the largest number of properties selling with discounts, with 7.2pc and 7.1pc of sales taking price cuts of 5pc or more.