A record number of homes are being sold off market – and to those with a more ‘averagely-priced’ property, new research suggests.
The first five months of this year saw a record 23 per cent of London homes change hands without being openly marketed, up from 20 per cent in 2021.
And separately, a higher proportion of homes are now sold discreetly in affluent country areas, according to the new research by Hamptons estate agents – with the average price of a property sold off-market overall being £850,000, down from £1.2million before the pandemic.
A record number of homes are being sold off market, according to estate agents Hamptons
The study found that 24 per cent of homes in these expensive country markets are being sold off-market.
In total 59 per cent of off-market sales are now outside the capital, with 10 per cent of homes sold off-market nationally.
The 59 per cent is a record high, while the number of homes sold nationally is now at the highest since 2015 levels.
This extension into both country and less expensive markets has primarily been driven by a lack of stock and a seller’s ability to secure a higher price in a competitive market, rather than privacy concerns, Hamptons suggests.
Selling off-market has traditionally been a strategy in more affluent parts of the country, predominantly in central London where privacy and pricing concerns are the primary motivation for most secret sellers.
However, these latest figures suggest this is now beginning to slowly change.
Buying agent Henry Pryor said: ‘More than 30 per cent of the properties we are acquiring for clients are off-market, not on websites or in estate agents windows.
‘Not all buyers or sellers want their friends and neighbours knowing their business and it’s often cheaper and easier not to have coach loads of people traipsing through your home or less stressful having to queue up with 25 other buyers for a 15 minute slot on a Saturday morning to make the biggest financial commitment of your life.
‘Most estate agents like to show how busy they are with lots of listings on property portals, but some of the best deals are done quietly with no fuss or fanfare.’
Singing the deal quietly: A record 59 per cent of off-market property sales are now outside of the capital
In the five years running up to the start of the pandemic, the average home sold off-market achieved £1.2million.
However, the growth in off-market transactions has increasingly been driven by lower-priced properties.
So far this year, the average discreetly marketed home changed hands for £858,000, down from £979,000 in 2021.
Hamptons said that with off-market sellers achieving record prices, more vendors have embraced this route.
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Buyers have been battling a stock shortage amid stiff competition, and have been prepared to pay a premium to seal a deal before a home is advertised more widely, including online.
So far this year, homes marketed discreetly have achieved a higher proportion of their asking price than their counterparts which were more widely marketed.
The average off-market home sold in 2022 achieved 99.5 per cent of its asking price, surpassing the 2014 record of 98 per cent, which was set in a strong prime central London market.
Meanwhile, similar homes marketed to a wider audience have achieved an average 99.1 per cent of their initial asking price so far this year, also a record.
These record prices are being achieved on the back of increasingly shorter marketing periods.
The average home sold away from the glare of the open market took an average of 42 days to find a buyer, compared to 65 days for a similar prime home that didn’t start life off-market.
Meanwhile, the average time to sell across the whole of the market in May stood at 26 days, up from 24 days in May 2021.
The longer time taken to sell an off-market home reflects the increased length of time it takes to find buyers purchasing in the prime market.
Typically, homes spend two to four weeks being quietly marketed, before either a buyer is found or it is launched on the open market to reach a wider audience.
The average home sold away from the glare of the open market took an average of 42 days to find a buyer compared to 65 days for a similar prime home that didn’t start life off-market
With more off-market properties securing a sale quickly, fewer homes are being advertised more widely later down the road.
Just over a quarter – at 26 per cent – of homes marketed discreetly came onto the open market this year, down from 38 per cent pre-pandemic in 2019.
Hamptons based its findings on Countrywide data.
Aneisha Beveridge, of Hamptons, said: ‘Selling off-market has become an increasingly established sales strategy over the last five years.
‘The first generation of off-market sellers were those people primarily concerned about the privacy of their home, keen to ensure it wasn’t exposed to anyone who wasn’t serious about buying it.
‘While these sellers still make up around half of homes launched off-market, they were joined in 2016 by central London homeowners keen to minimise their digital footprint in what was an increasingly tough market.
‘Post-pandemic, selling off-market has increasingly been driven by sellers keen to avoid wider marketing and limiting the number of buyers through their doors. And this strategy has paid off. Buyers have been willing to pay a premium to secure their home off-market and prevent sellers from marketing the property openly to other interested parties where competition is rife.
‘It is likely that we are reaching peak off-market sales levels. With the number of homes on the market forecast to rise later in the year, buyers are likely to be more cautious about paying a premium in the face of an increasing amount of choice. If this happens, off-market sales may retreat back into their prime heartlands.’