Rightmove is this morning reporting that the asking price of property coming to market has fallen 1.7 per cent in the past month - that’s a dramatic drop of £5,222 on average, and much more in high-value locations such as London.
And the portal says that while it’s not unusual for new seller asking prices to fall at this time of year, this is the largest November drop since 2012.
Rightmove believes that the backdrop of continuing political uncertainty, cooling markets in the south of the country and in the upper price sector, have all combined to persuade new sellers to drop asking prices earlier and more deeply than usual.
“This is a welcome effort by sellers to minimise the usual pre-Christmas market slowdown. Some new-to-the-market sellers and their agents have acted early to try to improve the buying mood and avoid the traditional ‘buyer humbug’ dislike of Christmas housing activity” according to Miles Shipside, Rightmove director and housing market analyst.
He says all regions see a monthly fall in the price of property coming to market, with most of the largest falls in the south.
The largest monthly faller is the South East with an average 2.1 per cent drop (equal to £8,647 on average. London new seller asking prices drop too by 1.7 per cent.
Shipside observes: “Seven years ago price rises started rippling out from the capital into the commuter belt in the South East. That ripple effect has now been reversed, with some of the London market price re-adjustment reverberating out into the commuter belt. New sellers of property now coming to market in this region have belatedly lowered their price sights. Higher end former hot-spot towns are now among the biggest annual fallers with Rickmansworth (down 7.1 per cent), Esher (falling 6.4 per cent) and Gerrards Cross (a drop of 6.0 per cent) now cold spots following price rises of nearly 40 per cent over the seven preceding years.”
These factors have contributed to the first national year-on-year price fall since November 2011, with the price of newly-marketed property now 0.2 per cent or £607 cheaper than 12 months ago.
Rightmove claims that with the supply of new-build houses remaining tight, a low interest rate environment combined with near record employment, and average wage increases now rising faster than both CPI inflation and average property prices, the underlying fundamentals for a stable property market remain sound.
To prove the point, the number of sales agreed by estate agents was up in October 2018 compared to October 2017, albeit by a modest 1.0 per cent.
“While many thought that the down-to-the-wire Brexit deal uncertainty would hold people back from buying, more buyers have actually jumped in. Some buyers see this pre-Christmas price lull as a gift to their negotiations. It proves that people need to get on with their lives and will continue to buy homes if the underlying economic fundamentals remain strong” concludes Shipside.