UK home sellers are adjusting to a challenging market by lowering their property asking prices, as indicated by the latest house price data from Rightmove.
The figures show a more pronounced decrease than usual for December, with a 1.9% drop in asking prices. This trend is sharper than the average decrease observed over the past 20 years.
Rightmove’s latest figures indicate an average reduction of £6,966 in property asking prices, bringing the average down to £355,177.
Tim Bannister, Rightmove’s director of property science, said: “Further price falls beyond the usual seasonal trends that we’d expect at this time of year signal that some new sellers are continuing to act on the advice of agents to price competitively,” attributing the trend to higher mortgage rates which have impacted affordability for potential buyers.
Jeremy Leaf, a North London estate agent and former RICS residential chairman, added: “These figures are not particularly surprising bearing in mind they reflect asking rather than sale prices and a degree of realism on the part of sellers who are reducing their aspirations if they really want to attract buyers.
“Asking prices are not values but often an agent’s aspirational starting point to marketing. Overall, sales agreed are down as transactions are inevitably taking longer bearing in mind weaker demand and higher base rates. However, recent reductions in mortgage rates, and inflation not rising quite as rapidly, has given the market a bit of a kick when needed.”
Leaf also added: “Looking forward, the Christmas period is likely to be quieter at least until Boxing day which is always a great time for attracting interest on the portals and although much interest is aspirational, we always find plenty of genuine interest too.”
Further reaction
Tony Hall, head of business development, Saffron for Intermediaries:
“Every year, we see sellers lower asking prices in the build-up to Christmas, hoping to move into their new homes before the big day, and that’s exactly what we’re seeing now. This, combined with stabilising swap and interest rates, is particularly great news for first-time buyers, and they remain more active than second-steppers as a result.
“Overall, house prices have held up much better in 2023 than many predicted this time last year, myself included! The market at the end of 2022 was turbulent to say the least, so it has been great to see more consistent and realistic pricing this year as the mortgage market thrives on stability. With the Chancellor also not pulling any rabbits out the hat for housing in the Autumn Statement, we should see this calmer period continue into next year, and pricing remaining fairly consistent as a result.
“Having said that, of course, the outlook for pricing varies hugely according to region and property type – for example, the sales agreed for studio, one- and two-bed properties is much higher than those for four-bed detached houses and all five-bed plus properties.
“All buyers and sellers, no matter their needs or circumstances, will be best served by consulting a qualified mortgage adviser before signing any paperwork. The market does remain complex, but there are plenty of fantastic opportunities for those with a good eye, and expert adviser guiding their search.”
