Residential property prices in the UK are expected to fall for the next three months as new sellers drop their asking prices by almost £4,000 in a bid to sell before Christmas.
The latest real estate index to be published shows that prices fell 1.6% between October and November, the first fall for three months. The Rightmove report shows that the average house price fell from £230,184 to £226,440.
It says this is due to sellers dropping prices as they are eager to sell before the festive period but the traditionally slow winter months will see further falls before the market picks up again in the Spring. But the general elections next year could bring prices down again as the market become jittery.
‘In all but the most buoyant of markets, home moving comes second to Christmas festivities. While the market has recovered from some dreadful lows, this month’s price fall proves that it doesn’t have the strength to buck seasonal trends,’ explained Miles Shipside, commercial director of Rightmove.
‘We expect three months of asking price falls before a tentative recovery in early spring, likely followed by pre-election jitters,’ he added.
The index also shows that property stocks remained low, with 30% fewer homes coming onto the market this month than the same point in 2007, and mortgage availability is still hampering a recovery in the market.
Many would-be sellers are still unwilling or unable to come to market and with the number of new-build properties running at half of the levels required to satisfy anticipated demand, aspiring home movers are set for a frustrating time for years to come, it says.
And overall the picture is promising with seven out of 10 regions showing prices are actually up on an annual basis. The South-East saw the largest increase in prices, with an average rise of 3.8% driven by the lowest average stock levels per estate agent.
The East Midlands was the worst performer with prices 1.6% below those of November 2008.
Rightmove has also found that the upcoming end to the stamp duty holiday is not causing a flood of sellers and buyers to come to the market. Currently properties between £125,000 and £175,000 are exempt from paying the 1% levy, with the exemption coming to an end on December 31 this year.