Olympics ‘prompt record fall’ in August property asking prices

House sellers dropped their asking prices by the biggest percentage recorded by a study for August as would-be buyers became engrossed in the Olympics. Property search website Rightmove said asking prices saw an “aggressive” 2.4% drop month-on-month to reach £236,260 on average, compared with the typical fall of 1.1% it has measured in August over the last 10 years.

The website also recorded plunges of up to 50% in its traffic at key Olympic moments as househunters became distracted by the sporting events and, most sharply, by the opening and closing ceremonies. It warned that as the tough economy continues, sellers will have to “compete hard” to attract buyers this autumn when activity traditionally picks up, if they want to move house before Christmas. No regions across the study, which covers England and Wales, recorded a month-on-month increase in asking prices, the first time this has happened since November last year.

The best-performing region on a monthly basis was north-west England, where prices were flat at £163,002. Prices dropped by their biggest percentage in the south-east, where they fell 4.2% month-on-month to £302,628. Prices in London, which has had strong interest from overseas buyers, recorded an 8.8% rise year-on-year to reach an average £454,875, but on a monthly basis prices fell in the capital by 1.2%. Asking prices in Wales dropped by 2.6% month-on-month to reach £162,736. Wales experienced the biggest year-on-year drop, with a fall of 5.2%.

Prices across England and Wales were 2% higher in August than they were a year ago. Miles Shipside, Rightmove director, said: “The number of new sellers is slightly up on the same period last year, though perhaps as a reflection of their urgency to sell, or to compensate for the distraction of the achievements served up by Team GB, they have dropped their asking prices more aggressively than summer sellers in previous years.” The Rightmove figures come as two of the nation’s biggest housebuilders – Persimmon and Bovis Homes – are scheduled to report strong half-year results. They are expected to have benefited from building more family homes and from capitalising on cheap land bought after the financial crisis.

The results will also reflect the rush by first-time buyers in the spring to exploit a stamp duty holiday that expired in March. Since then, the government has launched its new buy scheme to encourage the return of 95% mortgages and its funding for lending scheme to encourage banks to boost mortgage availability.


Source : The Guardian