House Prices Drop at Record Rate
A new report shows that house prices have dropped at their fastest rate in at least a decade as the weather warms and the market cools.
According to Rightmove national average house prices fell by 2.9% in the month to August. While the market generally slows down during the summer months, these latest figures represent the biggest monthly drop in house values since Rightmove’s records began over a decade ago.
The fall in house values is even more pronounced in London, where prices dipped by 5.9%. It is also the third consecutive month that prices have dropped in the capital.
The North of England was the only region in the UK where the average asking price of newly marketed properties, the criteria measured by Rightmove, actually managed to creep up. Wales saw a 2% dip in property prices.
Miles Shipside, director of Rightmove, said: “A drop in August is typical but it’s steeper than expected this year for two reasons. Firstly, both buyers and sellers are becoming increasingly aware about personal finances, given that the cost of mortgages are going up and regulators are trying to bring availability down. This limits what buyers are willing or able to pay, and helps moderate sellers price expectations.
“The second factor is the turnaround in London. Having forced national average prices up for the last two years, it’s now pushing them down with three falls in a row, and a real biggie this month. Holidays always cause a big price reverse in the capital, but there is also a massive year-on-year jump in the number of newly-marketed properties, up 20% compared to August last year, and double the figure seen in any other region. More sellers and fewer buyers mean price falls.”
Mr Shipside went on to remind house buyers that they are now “a scarcer species”, as competition to sell property means that we are moving away from the typically seller friendly scenario we were experiencing earlier in the year and into a market in which house buyers are more able to call the shots.
He went on to say that:
“This is not a glut of property for sale or a major price drop drama, though we do expect more holiday season price falls next month before the usual autumn activity flurry. It will, however, come as some relief to the Bank of England that there are signs the market is effecting its own natural slowdown without a rate rise, though under-pinned by greater awareness among the public that the five year holiday of record low interest rates is coming to an end.”
However, despite Mr Shipside consoling words, the fact is that the usual house prices drop witnessed in August is just over half the substantial drop witnessed this month. Chances are this simply represents a reaction to changing market conditions and diminished confidence, outside factors such as the MMR restrictions and impending interest rate rises and seasonal fluctuations. However, there are those that are claiming the recent price drop heralds an imminent downturn in the market. Either way, homeowners will be watching what national house prices do over the next couple of months.
If you are selling property and have concerns over the changing market conditions, or find yourself struggling to find a buyer as more properties enter the market and demand declines over the summer months, contacting the UK’s leading guaranteed house buying company National Homebuyers could well be the best option for you. We buy any house, in any condition or location, anywhere in the UK. As a guaranteed cash buyer we offer a quick house sale process that removes any chance of unwanted complications when you come to sell your home.
If you want a fast house sale over the notoriously slow summer period, or simply want to sell your home without all the stress and hassle that is often associated with selling property, contact National Homebuyers today and, following the provision of a fast, no obligation valuation of your property, we guarantee to make a genuine cash offer to buy your house, chain stress and hassle free.