The year so far has exceeded expectations, with sellers pricing their properties more competitively. This month, average new seller asking prices have dropped by 1.7% (-£6,088) to £362,143. As Christmas approaches, sellers are adopting a more realistic approach to pricing in order to attract buyers. This drop in prices, the largest in five years, indicates that sellers are increasingly understanding the importance of setting realistic prices from the start. Despite the challenges, key indicators suggest that the market has been more positive than anticipated.
The number of sales agreed is now 10% below 2019 levels, an improvement from last month’s 15% decrease. The shortage of properties caused by the pandemic is now over, with the number of available homes for sale only 1% behind 2019 levels. However, certain regions and market sectors are transitioning better than others when it comes to pricing. Sales for studio, one-, and two-bed properties are only 7% lower than 2019 levels, while sales for four-bed detached houses and larger properties are 14% behind. Additionally, Wales, Scotland, and the North of England have seen price increases, while the Midlands and southern regions have experienced declines.
The Bank of England recently decided to keep the Base Rate unchanged for the second time, which has helped maintain buyer demand. Many are now looking to the upcoming Autumn Statement for potential announcements or incentives for the market. One potential announcement is the renewal of the mortgage guarantee scheme, aimed at assisting those with smaller deposits. However, data shows that these types of mortgages only make up a small percentage of overall mortgages, highlighting the limitations of the scheme.
Source – Rightmove HPI