House prices fall as properties flood on to market
Last updated at 16:04, Friday, 23 July 2010
New sellers dropped their asking prices for the first time this year during July as properties continued to flood on to the market.
The average asking price for a home in England and Wales fell by 0.6 per cent to £236,332 during the four weeks to July 10, according to property website Rightmove.
The group said an average of 30,000 new homes were currently being put up for sale each week, 45 per cent more than during July last year.
The average number of properties estate agents have on their books also rose for the fifth month in a row to reach 77, the highest level since August 2008.
As a result, there are now five new properties on the market for every two potential buyers who have a mortgage approved.
Rightmove warned that conditions were rapidly shifting to become a buyers’ market and it expects house prices to lose all of the gains they have made so far in 2010 during the second half of the year.
The average cost of a home has increased by seven per cent or £15,506 since the beginning of January to peak at £237,767 in June.
Miles Shipside, commercial director of Rightmove, said: “The number of new mortgages being approved each month is less than half the number of new sellers, with the imbalance being exacerbated by the increase of nearly 50 per cent in the number of properties coming to market compared to a year ago.
“More aggressive pricing is now the order of the day, which means that conditions are ripe for a strong buyers’ market in the second half of 2010.
“This is likely to see the average price gains of seven per cent for the first half of the year wiped out by year-end, in line with Rightmove’s original forecast for the year of no net change in prices.”
This week’s figures are the latest in a raft of gloomy data on the housing market, with Halifax recently saying prices fell for the third consecutive month to June.
A recent survey carried out by the Royal Institution of Chartered Surveyors also showed that property professionals expect prices to fall during the coming months, after activity in the housing market has failed to pick up momentum following a subdued start to the year.
Asking prices rose in the south west, Wales, West Midlands and East Midlands during the month, with the south west leading the way with a rise of 2.8 per cent, according to Rightmove.
But prices fell in all other regions, with East Anglia seeing the biggest slide of 2.3 per cent, followed by Greater London at 1.7 per cent.
Howard Archer, chief UK and European economist at IHS Global Insight, said: “We had expected house prices to be essentially flat overall through the second half of 2010, with prices erratic on a month-to-month basis. A modest relapse is now more likely and we suspect that house prices could fall by around three per cent to five per cent over the second half.”
First published at 14:13, Friday, 23 July 2010
Published by http://www.cumberlandnews.co.uk
