Asking prices for homes in Britain have experienced their sharpest decline in five years for this time of year, according to a report from property website Rightmove. The data highlights the impact of rising borrowing costs on the housing market, as average asking prices dropped by 1.7% between October 8 and November 4. This fall is larger than what is typically seen during the pre-Christmas period.
Rightmove clarified that their data is not seasonally adjusted, suggesting that the decline may be a true reflection of the current market conditions. Tim Bannister, the director of Rightmove, explained that while there are still buyers in the market, many are facing reduced affordability due to higher mortgage rates.
The housing market in Britain experienced a significant boom during the COVID-19 pandemic. However, it lost much of its momentum as the Bank of England implemented 14 consecutive interest rate increases between December 2021 and August of this year. The bank paused its rate hikes in September.
Rightmove’s report reveals that asking prices are currently 3% lower than their peak in May. Additionally, agreed sales have dropped by 10% compared to their pre-pandemic levels in 2019. However, the decline in sales appears to be less severe than what was observed in the month leading up to early October. The report also indicates a slight improvement in the shortage of homes for sale, with the number of properties on the market only 1% below the levels seen in 2019.
These findings suggest that the recent decline in asking prices may be influenced by the combination of reduced affordability for potential buyers and a slight easing of the shortage of available homes. The housing market slowdown could potentially impact homeowners and stakeholders in the industry.
It is important to note that Rightmove’s data is based on asking prices rather than actual sales prices, and it is advisable to consult other sources and experts to gain a comprehensive understanding of the current state of the housing market in the UK.
More detail via Daily Mail Online here… ( Image via Daily Mail Online )