Asking prices dip at end of 2014

Asking prices for residential properties in the UK suffered the largest monthly drop on record in December, as the market continued to cool, according to Rightmove.

The property website reported that 2014 has ended with the average asking price for a home in Britain falling by almost £9,000, leaving prices up 7 per cent during 2014.

But whilst a near £9,000 drop is the biggest ever reduction in the price of newly marketed property compared to the month before and a sign of a market continuing to cool, Miles Shipside (left), Rightmove Director and housing market analyst, pointed out that “a fall is not unexpected in December”.

He commented: “Though sellers are fewer in number at this time of year, those that do come to market are often keener to sell so price lower in a bid to stand out. The overall picture for the year is still one of a much recovered property market, with sellers and their estate agents confident enough to be putting property on the market at a higher price on average than a year ago.”

Despite the sharp fall in December, Rightmove project that asking prices for homes on sale in Britain are likely to rise by between 4 and 5 per cent next year, led by gains in the South East as the London ripple effect continues and stock shortages remain acute.

“In spite of generally positive market conditions, some of the measures designed to restrain and control buyer demand have also curtailed the supply side by damaging the desire and ability of homeowners to place their property up for sale,” added Shipside. “Elections also add a further element of uncertainty that may deter some from making a major financial decision to trade up or down, so the likelihood is that good quality property will be in short supply in higher-demand locations, leading to higher prices where buyers still remain ready, willing and able to proceed.”

With the average number of properties for sale per estate agency branch at an historical low for this time of year, “there is still some scope for price growth” according to Shipside, but he insists that “sellers and agents will have to work harder to achieve a sale next year”.

Rightmove’s findings are supported by the latest Home.co.uk Asking Price Index which also shows that asking prices fell in December in line with seasonal expectations.

The mix-adjusted average asking price for England and Wales rose 7.6% during 2014, according to the Home.co.uk Asking Price Index led by gains in London and the south of England.

Looking ahead, Home.co.uk forecast that 2015 will be a more consistent year for UK property prices than 2014.

Source: Property Market