Sellers cut prices in wake of housing slowdown

Permalink: Sellers cut prices in wake of housing slowdown
by Kay Murchie

In its latest survey of the housing market, property website Rightmove, said sellers are now being more realistic with property prices after figures show that asking prices are being slashed.

Rightmove, which is the UK’s largest online housing website, said sellers are asking £5,403 less for their homes than they were only a month ago, this represents a 2.3% drop.

Meanwhile, in London asking prices are down by 5.3% compared with a month ago, representing a fall of £21,000 in the 4 weeks to 9 August, according to Rightmove.

Prices fell sharply in the North West and in East Anglia, where they were down by 3.3% and 3.2% respectively.

However, in the East Midlands, asking prices appear to have risen in the last month, by 1.6%. They held relatively steady in the South West where they were down 0.4% and were down 0.9% in the North.

However, in spite of the aggressive price cutting in some areas, properties are still difficult to sell. Rightmove-registered agents have reported an average 78 unsold properties on their books, up from 77 last month.

The mortgage squeeze is to blame as transactions are in danger of falling to levels not experienced since the late 1950s, according to Miles Shipside of Rightmove.

In related news, last week the Royal Institution of Chartered Surveyors (Rics) revealed that the number of homes changing hands has fallen to levels not experienced since their survey started in 1978.

The organisation said the average number of property sales handled by surveyors across the country over the last three months plummeted to just 14.4 - the equivalent of less than 5 a month.

The lack of mortgages available on the market, as a result of the credit crunch, has meant that prospective buyers have been unable to secure a mortgage and this has resulted in the fall in housing transactions say Rics.

However, the organisation echoed Rightmove’s figures after noting that ’realism’ is returning to the UK property market as vendors started to drop their asking prices last month.