Asking price reductions on the rise as market loses momentum

Property sellers in the South of England are having to accept asking reductions in order to achieve a sale. 

Data from Hometrack shows that sellers in London, Oxford and Cambridge are accepting average discounts of up to almost 5% to get a deal over the line.

The gap between asking prices and sale prices is also widening in other southern locations such as Bristol, Portsmouth and Southampton.

However, the UK location with the largest discount from typical asking prices is Aberdeen (9.6%) where average prices have fallen by almost 20% since 2014.

Average price inflation across all major UK cities now stands at 4.9%, according to Hometrack, with an average property price of £252,600.

The strongest house price figures have been recorded in Manchester, Leicester and Edinburgh, where typical prices have all grown by over 7.2% since April 2017.

The highest average city price is in London at £487,600, while the lowest is in Liverpool at £117,200.

“The strength of house price growth and level of discounting from asking prices reveals how the current housing cycle continues to unfold," says Richard Donnell, Hometrack's insight director.

"The overall pace of overall city level growth has lost momentum as a result of virtually static prices in London and slower growth across southern England."

"Weaker consumer confidence and modest increase in mortgage rates are also impacting demand and mortgage approvals for home purchase have drifted lower in the last quarter."  

He says that a range of macro and local factors - including strength of a local economy and relative affordability of housing - continue to influence the pace and direction of house price growth in the UK's major cities.