People looking to acquire real estate now display increased sensitivity to prices, especially if the desired objects are priced above their market value. As a result, the sales period is extended.
Examining some 7,000 real estate financings over the period between 2021 and 2024, the St. Gallen insurer and the mortgage comparison platform noted on Wednesday a greater restraint among buyers in investing additional equity in order to acquire a property real estate whose price exceeds the market value. Currently, one in five properties is still sold above its market value. During the coronavirus pandemic, the proportion reached a quarter.
According to the analysis, the additional amount received by sellers represents on average 7% of the market value of an object. Thus, for an object with a market value set at 1 million francs, it amounts to no less than 70,000 francs.
As potential buyers become more careful about spending, the sales period lengthens. Two years ago, it took an average of five months to complete a transaction, according to Moneypark. Today, this period has reached seven months. ‘It’s been a long time since all real estate has sold like hot cakes,’ comments Lukas Vogt, Managing Director of Moneypark, quoted in the press release.
However, the location of a property can speed up its sale. Thus, in places considered attractive, one in four objects finds a buyer within around three months. In less popular locations, the sales period can extend to around eight months.
/ATS
