–First Monthly Fall Since December 2009
–UK July House Asking Prices Up 3.7% y/y
–Mortgage Drought, Rise In New sellers Weigh On Prices
LONDON (MNI) – UK house asking prices fell for the first time since
December 2009 in July, dropping 0.6% on the month following a 0.3%
increase in June, according to the UK’s largest property website,
Rightmove.
The annual rate for July came in at 3.7% as against 5.0% in June.
An increase in the number of new sellers is putting downward pressure on
prices, with new sellers now outnumbering mortgage approvals by 5:2,
Rightmove said.
“Estate agents are suffering from podgy portfolios, and buyers’
fitness to purchase is in correspondingly poor shape. With agents
beginning to choke on a surfeit of new stock, sellers are going to have
to price at bargain levels and bullishly promote their properties in
order to stand out from the crowd,” said Miles Shipside, commercial
director of Rightmove.
“The number of new mortgages being approved each month is less than
half the number of new sellers…This is likely to see the average price
gains of 7% for the first half of the year wiped-out by year-end,” he
added.
Rightmove said that with the recent Budget posing threats to
investor returns due to the increase in Capital Gains Tax, fears over
job losses and the proposed cap on Housing Benefit, investors will be
looking for an opportunity to acquire future assets more cheaply.
“Consumer sentiment is a major influence on the housing market and,
while many would-be owner-occupiers are not swayed by short-term
negativity or dips in prices, many harder-nosed investors will decide to
circle and wait”, Shipside said.
–London newsroom: 4420 7862 7499; email: William.Wilkes@marketnews.com
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