bbc.co.uk, landregistry.gov.uk, rightmove.co.uk (image courtesy of guardian.co.uk)
The asking prices of homes put up for sale has dropped by 3.1% in just one month, according to the property website Rightmove. The website said that prices, and the number of homes for sale, were falling victim to economic uncertainty. The average asking price of newly marketed properties fell by £7,528 to £232,144 in the month of November. This fall in asking prices is the biggest that Rightmove have recorded since December 2007, and it was the third largest recorded in the history of the site.
Miles Shipside of Rightmove indicated that the seasonal slowdown had come early; “The relentless stream of economic uncertainty around the eurozone crisis has eroded customer confidence to the extent that it now dominates decisions when it comes to moving home. A 13% fall in the number of new sellers coming to market, compared with the previous month, and an 11% fall compared with November 2010, illustrate a growing reluctance to make big financial decisions.” Rightmove can analyse with some confidence as they claim to advertise 90% of all UK homes for sale.
There has been a shortage of potential property buyers since the onset of the credit crunch in 2008, which forced lenders to ration home loans. With first-time buyers needing a 20% deposit to obtain a mortgage, the supply of buyers has been greatly reduced. In fact the figures show that the overall level of sales has fallen by more than 50% since 2007. Land Registry figures show that the average house sale price for September in England and Wales was £162,109. This is a long way from the asking price level, which has fluctuated between £220,000 and £240,000 for the last three years.
Property market commentators now expect the gap to narrow between asking and selling prices throughout 2012 with growing unemployment and a general financial crisis forcing people to sell.
Land Registry Cite 0.9% House Price Fall for October
The average house price fell by £2,020 to £160,000 during the month of October, according to the latest data from the Land Registry. The report, which looked at 16 million transactions showed an increase in the pace of falling property value at 0.9% versus the 0.3% fall cited for the month of September. Over the last 12 months, the Land Registry says that house prices have dropped by 3.2%.