£10,000 Property Reduction Caused By Consecutive Monthly Price Falls
Rightmove’s December property index has found that two consecutive and significant property price drops has meant that properties are now £10,000 cheaper than they were three months ago.
The price of property coming into the market at present is 1.5% cheaper than it was in November, this equates to a reduction of £4,496.
Alongside November’s decreases, this means that property prices are now 3.2% cheaper than they were in October and around £10,000 cheaper overall. The last time two consecutive months fielded larger decreases in property prices was in 2012, when property values dipped by £11,836.
Miles Shipside, Rightmove director and housing market analyst, comments: “It’s usual for new-to the-market sellers to price lower in the run-up to Christmas to tempt distracted buyers, so we should not read too much into the mere fact of two consecutive monthly falls. However, these falls have been larger than usual, making this the largest fall over two months for six years, showing that there are more than just seasonal forces at play. With stretched affordability limiting some people’s ability to buy for the first time or trade up, a modest lowering of property prices combined with an increase in wage growth could help more of them to move and thus increase transaction numbers.
“Rightmove’s forecast for 2018 was that prices would rise by a subdued 1% as lacklustre wage growth and tighter lending criteria could no longer support rising prices in some regions. However, the northern regions are keeping the national figure in positive territory as 2018 draws to a close. Wales leads the UK’s annual growth with +6.2%, while the East Midlands, West Midlands and Yorkshire & the Humber are all between +4% and +5%. We forecast that 2019 will see a similar pattern with the north still broadly out-performing the south, though our prediction for the year ahead is slightly more muted with the overall national average flat at 0%.
“The run-up to Christmas can be one of the best times for buyers to negotiate a better deal, as they are fewer in number so sellers who are keen to sell have to talk turkey on accepting a lower price. The window of maximum buyer negotiating opportunity starts to close from Boxing Day onwards, as more buyers become active in the market. From the low point on Christmas Day, the number of pages of property viewed on Rightmove last year more than tripled (+228%) by the first working day of the New Year. Home owners who are thinking of coming to the market early in 2019 should seriously consider doing so as soon as possible to get maximum exposure to the surge in interest from buyers who make it their resolution to move in the New Year.
“It’s usual for new-to-the-market sellers to price lower in the run-up to Christmas to tempt distracted buyers, so we should not read too much into the mere fact of two consecutive monthly falls. However, these falls have been larger than usual, making this the largest fall over two months for six years, showing that there are more than just seasonal forces at play.”
Peter Woodthorpe, Director of Readings in Leicester, said: “Overall our sales have been up this year compared to 2017 and prices have been growing steadily. The lack of stock for sale in our area has led to some over ambitious pricing which is the reason why some properties might be sticking, and it’s why pricing correctly from the start is so critical. There’s definitely one or two bargains to be had as is usual at this time of year. As prices are still relatively affordable for home-owners and the market is still fundamentally sound in our area, there’s no reason why the market will not continue to perform well next year.”
Nick Leeming, Chairman of Jackson-Stops, comments: “The 2019 property market is likely to get off to quite a slow start in the New Year while the UK awaits clarity on Brexit negotiations. However, despite the market not being as buoyant as it was a few years ago, accurately priced homes will still sell so it is interesting to see signs of vendors starting to recognise this in Rightmove’s latest data. Over the last year there has generally been a mismatch between vendor expectations and the price that buyers are prepared to pay, particularly at the top end of the market, so properties launching now at a competitive value will stand out and attract buyers’ interest. In my experience the first working day after the New Year break is one of the busiest days for property portals, so for those looking for their home to be front and centre of the property parade this is a crucial time for marketing.”
Although the number of sales agreed with estate agents is down by 2.1% on the figures from last year, the report claims that there should be optimism that a cheaper market and falling prices are encouraging people to look for property and make offers, despite the impending uncertainty caused by the political climate.
Do these figures reveal a similar trend for the conveyancing sector? Have you found less people purchasing property over the last three months?