Over the years an understanding has developed between sellers and buyers when it comes to the property market. Buyers are well aware that sellers will pull out all the stops to try and get the asking price on a property, and that many would put their property up at a slightly higher price so that they could account for any drop in the asking price. Sellers, also, have always expected buyers to haggle when it comes to the amount that they offer for the property.

However, according to a recent report the global credit crunch and the major housing slump that has hit the nation has resulted in the divide between buyers and sellers widening, with some buyers asking for discounts of as much as 20% off the asking price of properties. With sellers in a very bad position at the moment due to the housing market grinding to a halt, many are being forced into accepting far lower offers for their properties or else to risk them sitting on the market unsold for the foreseeable future whilst house prices continue to fall.

Property values in the UK have been falling for the last eleven months in a row according to industry officials, and many sellers who are desperate to sell up have had to resign themselves to the fact that they are never going to get the asking price, and in some cases may get nowhere near the asking price for the property. However, with estate agents reporting the poorest property sales figures in decades, sellers have little choice but to admit defeat or see their property stagnate unsold on the estate agents’ books.

It may look as though buyers are taking advantage of the situation by demanding these huge discounts on property prices, but they are also experiencing problems that may be forcing their hands when it comes to how much they can afford to pay for a property. Since the onset of the global credit crunch lenders have really tightened up their lending criteria. Mortgage loans have become more difficult to come buy, lending criteria has been tightened, and deposit levels have been increased, all of which has made affordability very difficult for many buyers, particularly first time buyers.

The Bank of England recently stated: ‘Uncertainty regarding valuations was discouraging potential buyers, some of whom were reported to require discounts of at least ten to 20% off the asking price.’

The slump in housing sales has been getting worse over recent months, with many buyers concerned over continued falls in house prices and rising borrowing costs. However, the government has recently confirmed a twelve month suspension on stamp duty on properties up to £175,000 in value, which may help to kick start the housing market again to some degree.

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