Asking prices have taken a tumble for the first time this year, Rightmove reported this morning.
It said that the average asking price for a property new to the market is now £249,199, down 1.8% from July’s figure of £253,658.
Rightmove said the fall was usual for the time of year, but described it as “modest”. Despite the fall, asking prices have risen nearly 9% so far this year – equivalent to £20,201. Asking prices for apartments swam against trend, hitting new highs.
The site also said that demand from buyers is increasing, with the number of email leads sent to agents up 17% compared with this time a year ago.
Despite improved demand, supply of property has barely moved. Rightmove said there had so far been just 0.2% more properties put on the market so far this year, compared with the same eight months last year, equating to just 1,664 homes.
Rightmove warned that with economic recovery, low interest rates and the Help to Buy scheme all boosting demand, more properties were needed to be put on the market to stop “excessive” house price inflation.
The site said that January’s launch of the second phase of Help to Buy – which will make 95% mortgages accessible to purchasers of both new and secondhand property – would increase buyer demand further.
Director Miles Shipside said: “Demand is already on the up, and that’s before the roll-out of phase two of the Help to Buy stimulus.
“It is now crucial that the supply of property improves so that the goal of a significant increase in transaction numbers is not overshadowed by an unsustainable boom in property prices.
“Flats are in most demand by first-time buyers and buy-to-let investors, and we have seen prices for this property type hit their highest-ever level as supply fails to keep up with an increase in demand at the bottom of the market.”
Rightmove also said that pricing is still London-led. Prices in the capital are 10.2% higher than a year ago, compared with an average of 2.8% for the rest of the country.
Meanwhile, haart also this morning warned of a “chronic supply shortage”. It said that total new applicants are up 27.9% annually, but new instructions are down 4.4%.
In London, it says that new applicants are up 60.3% on last year, but new listings are down 17.7%.
The firm says that in particular, there has been a strong surge in first-time buyer applicants, up 76% on a year ago.
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Comments
rant - bring on the nutters, I say!
If they're having a go at me, they're leaving other folks alone.
Makes life interesting, does it not...? ;o)
Thanks for the comments PeeBee. I appreciate your down to earth views on the subject matter too and it's a shame that you've attracted more than your fair share of nutters.
In the good old days, saving as an investment as I have done was greatly encouraged by the authorities. It provided capital for banks, who would then wisely lend it out to businesses and individuals to use for investment purposes. This in turn enabled the economy to grow and added to the nation's wealth Admittedly this is much less black and white these days. Saving was generally viewed as one of the best things you could do with money, especially compared with more morally dubious speculation. Times have changed, not for the better in my view.
Than you once again, rant, for your response.
I'm not going to say that I disagree with your differentiation criteria - but I'm not going to agree either.
There is no such thing as 'free' money, matey. Someone along the line is paying for it to be given to you. Whether it is an individual, or whether it is all of us makes little difference in the grand scale of things.
And unfortunately, society dictates that we all make what we can out of what we can. Houses, cars, gold - you name it. If it has a value then we cling to that value - and need to do so - as whatever we replace the commodity with needs to be paid for.
You know my personal views from previous discussions - but my professional views are based upon the above. As are those of any Agent who posts here, I would suggest.
But, as always, I look forward to your point of view. It is just a shame that some individuals respond in such a disrespectful manner to you.
I for one have learned a lot from your postings, and I thank you for that.
It's how the financial gains are made PeeBee. Making free money on the back of a basic human need such as shelter is in a totally different league than say investing in fine art or gold.
Good to see you back too Jonnie. All valid points and ones you've been making since I arrived here (2011 for the record). In response, I would highlight the small print on some recent government statement to expand many of the current schemes such as Help to Buy and Quantitative Easing 'should the market not respond favourably to them.' There is now no pretence: I never expected the authorities to be so desperate to avoid the deflation of an obvious property bubble that they would semi-nationalise the housing market, but that's what they've gone and done.
The fundamentals to buying now remain terrible in my opinion - house prices are now once again rising significantly faster than wages are and folk are signing up for a 25 year loan commitment when historically low rates are being artifically suppressed further. The banks wouldn't return to the days of 125% mortgages, so the government has offered up taxpayers' money instead through help to Buy. This isn't a recovery - it's a relapse and a day of reckoning will come. I wouldn't like to predict when that will be.
With regard to my own circumstances, if house price growth hits 10% per year, then I'll no longer have the funds to buy outright. It doesn't mean I'm about to jump in though, far from it.
rant - thanks, as always, for your response. And I agree with you - money that is unearned is NOT money from the fairies.
But here's the thing. By your own admission, you returned to Blighty some years ago, rented a property that you state your invested money pretty much pays for and the interest you are accruing is adding to your 'pot# for the glorious day when in your eyes, prices become sensible enough to buy at.
That would be UNEARNED INCOME you are using, would it not?
Sorry, matey - but I'm struggling to see how you can therefore justify how you can have an issue with it when it relates to house value gains, but not on YOUR investment coming up trumps...
Rant,
As PeeBee says, good to hear from you although id also like to know what became of Sibs.
I assume you still haven't done a cash deal on something and are still renting? Do you realise we've been swapping views on here for a long time now, since 2008 is it? I assume the crash you boys predicted is still yet to come in your view?
Round here This HTB thing is all very well but as its only on new at present no second hand vendor has benefitted but with or without it people seem to be just getting on with moving in greater numbers, no hysteria, no band wagon jumping just cracking on with life
I've asked you a hundred times over he years, when is the HPC coming ? you must agree its taking its time and every potential reason you've ever given over the years hasn't done the job so far has it
As I said, good to see you are still around / to have your opinion on here
Jonnie
Unearned equity isn't money from the fairies PeeBee. Amounts above wage increases are merely transfers of wealth from the housing have-nots to the housing haves. As a non-home owner, that's why I have an issue with it.
I'm not saying HTB is a good idea Happy, far from it. I'm merely putting points across from some people who think it is wonderful news. It helps to understand your enemy ; )
You have given four reasons why it is quietly supported by overleveraged homeowners, politicians and builders who see only short term gain. If you think it is a good idea you should leave the HPC corner and join the homeowners alliance. :0)
I am a home owner but can see who this policy is madness. Even many EA's seem to agree this is a short sighted vote winning policy and disaster waiting to happen and has not bee fully thought through..
However i read the following recently, Stuart Law, CEO of Assetz, recently commented “What commentators should be pointing toward is the easing off of support for London house prices by abandoning Help to Buy in London and the South East.
Now that seems a very logical thing to do. It will encourage purchasing in less populated areas of the country that have seen less HPI.....would this better balance the market?
rantnrave - hello again, mon ami!
Your 'reasons' are, I guess, reasonably valid to start a discussion - although your definitions are dubious to say the least! ;o)
ANYWAY... back to you. I'm glad you've posted as I was beginning to wonder when we would next see from you.
I was ALMOST beginning to wonder if you'd sneakily snaffled up a property on the nod of a boomlet heading your way! Tell me I'm wrong. I can't ask the same of Sibley's... as he seems to have disappeared without trace but perhaps as you guys 'know' each other, HPC-wise, you might know whether hat's the case with him and let us in on the gen?
As an aside, by the way, you mention in your post that a proportion of the homeselling population "...have very little pension provision besides unearned equity". That may well be true, matey - but I have to ask why you have a problem with the "unearned" part of it?
Your response, as always, is welcomed. ;o)
"I have yet to find a cohesive argument anywhere stating even why HTB is a good idea."
1. Several million Boomers are close to retirement age and are either MEW'd up to their eye-balls and / or have very little pension provision besides unearned equity.
2. Unlike the priced-out generation, those Boomers' votes are critical to the Tory party's chances of winning the next election.
3. Close to half of MPs have declared property interests beyond their first residence.
4. Builders will not build on land they bought at peak prices unless they can make a profit, which can now only be provided by the taxpayer (aka, a bailout). The building industry is well connected and have lobbied for such support.
There's four off the top of my head...
Increasing prices dut to supply and demand is not immoral IMHO the help to buy scheme is though, I have yet to find a cohesive argument anywhere stating even why it is a good idea.
How is it immoral? The buyers themselves dictate the prices to a certain extent. To get the property they want they will pay what they can/have to. If they know that one down the road sold for £120k, and another one comes up at £123k, then to get the house they will pay it before someone else does, providing they think its worth it. If the same house came on at £135k, then they would offer lower or wait til the price was right.
SA Longden - come on it is not immoral it's just economics. and of course people instruct an agent to achieve the best price possible (whatever caveats come after that)
However, if only it was a true "free market" and supply demand and affordability were the only things driving price.
Unfortunately we have something that really is immoral the "Help to buy" scheme. This government interference to the free market (a tax payer underwritten shared ownership scheme) has nothing to do with helping people afford a roof over their head and everything to do with stimulating the FIAT money system, tax revenues on transactions and winning an election.
I said long time ago that with affordability ratios being as they are, the only way the market would start moving was a return to loony lending i.e 125% mortgages etc. I didnt see it happening soon and the banks would not play ball. So the government have stepped in to make it happen. I will be interested to see what the plan is to remove this prop in 3 years time and what new "help to buy" will be thought up then!
Until then its bubble time again while the potential buyers believe (and have VI's reinforcel to them) that the government backed interest free 5 year loan is free money off the magic money tree that they will never have to pay back. Will this scheme become the next big misselling time bomb like PPI and interest only mortgages!
Does anyone think that the HTB scheme is a good idea?
@PeeBee
hahaha
'S A Longden'
Right - here's the deal. You think it's "immoral" to ask more for property - so YOU do the 'honourable thing' and sell YOURS for exactly what you paid for it, whenever that was.
Let us know you've done it and therefore prove that you are not a hypocrite with a poorly hidden agenda - otherwise stop posting such unadulterated billshut.
@S A L - immoral? No it is not immoral, the queue of potential buyers means that an agent has no choice, after all the actual job of an agent is to sell a property for the best price possible - it would be illegal for us to do otherwise.
However, whether or not it is RIGHT is a different matter altogether.
If I was thinking of buying right now I certainly would not be stretching myself - it seems to be a crazy idea.
What happens when the base rate returns to normal?
There is a definite bubble building in London.
Outside the M25 it's not so bad, but again when the London market corrects itself, as it surely must, that will create a downward pressure on properties in the rest of the country - it always does.
Economics of the madhouse. Shortage of properties does not make them intrinsically worth more. To increase prices due to a queue of potential buyers/renters is immoral.