0:02 AM, 18th November 2024, About a month ago
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Average house prices have fallen by 1.4% this month, a larger drop than the usual seasonal decline, which is probably down to pre- and post-Budget jitters, Rightmove reveals.
It says that despite the recent slowdown, the housing market remains more active than last year, with the number of agreed sales up 26% and new sellers entering the market up 6%.
Recent Bank Rate cuts have injected some optimism into the market, with Rightmove’s real-time data showing early signs of an uptick in buyer demand.
As a result, the property platform is forecasting a 4% price increase in new seller asking prices next year – driven by lower mortgage rates and pent-up demand.
The average price for property is £366,592.
Tim Bannister, Rightmove’s director of property science, said: “There’s been a lot of news to digest for home-movers over the last few weeks and it appears that the market may still be chewing it over.
“We had been seeing a drop-off in buyer demand, both in the lead-up to the Budget and in its immediate aftermath, as it was confirmed that there will be an increase to stamp-duty charges for most home-movers and second-home buyers, and some first-time buyers.
“However, a second Bank Rate cut and a boost of optimism regarding 2025 appear to have reversed this trend at least temporarily.”
He adds: “The big picture of market activity remains positive when compared to the quieter market at this time last year.
“This sets us up for what we predict will be a stronger 2025 in both prices and number of homes sold, particularly if mortgage rates fall by enough to significantly improve affordability for more of the mass-market.”
Propertymark’s chief executive, Nathan Emerson, said: “The Bank of England’s recent cuts to interest rates are likely to spur on more movement and further stimulate the market.
“With many buyers in England and Northern Ireland looking to move quickly before the Stamp Duty rises in April, we could see more people willing to accept heavier negotiations than normal, which could result in a small dip in the average house price.
“With the potential of a rise in the volume of transactions on the horizon, we would anticipate a spiked shift towards the improvement of the overall health of the economy.”
Jeremy Leaf, a north London estate agent and a former RICS residential chairman, said: “Although these are asking, rather than selling, prices, this month’s larger-than-usual drop confirms what we are seeing in our offices.
“There is more demand and sales agreed are up too but the increase in listings means buyers are spoilt for choice so sellers must be competitive if they want to stand out from the crowd.”
He added: “The Budget did not do the housing market any favours and may even extend the cautious tone as measures announced will probably mean mortgage rates remain higher for longer.”
Tomer Aboody, a director of specialist lender MT Finance, said: “More activity is leading to slower growth in asking prices, as buyers are in a stronger position with more stock available for sale.
“We are seeing some further push forward from the market with regard to mortgage rates, helped by the latest bank rate reduction, although further cuts might be slower in coming.”
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