17 Nov Seasonal house price dip spells steeper rise next year, warns Rightmove
The smaller than expected seasonal November slowdown in house prices could spell an even steeper rise next year, according to property website Rightmove.
November saw the smallest drop in asking properties since 2011, new research shows.
House prices fell -1.3% during the month to £292,572, indicating even higher prices next year, said Rightmove.
Sellers who come to market before Christmas typically set lower asking prices as buyers are harder to attract at this time of year.
Miles Shipside, Rightmove director and housing market analyst, said: “New-to-the-market sellers have dropped their asking prices at this time of year for the last eight years, with an average drop of 1.9% over the last five years. Those looking to market their property as Christmas gets closer often have a greater sense of urgency to find a buyer and sensibly recognise that trimming their asking price will provide an incentive to potential buyers more focussed on seasonal Christmas trimmings.
“It’s likely to be a short-lived respite as the combination of high confidence and low interest rates is a recipe for higher prices next year.”
Seven in ten home-owners said they think house prices will increase more in the next year. Out of the 23,000 interviewed, 85% do not think their financial situation will worsen in the next 12 months.
While house prices dipped in November, over the past year they have risen 6.2%.
In London, property prices for the month fell -1.6% to £619,866 from £630,050. This compares to the average price of £573,228 a year ago.
The largest monthly change was in Wales, where property prices fell -3.7% to £169,542. Over the past year, average house prices in Wales fell -0.8%, bucking the overall trend.
For first-time buyers the average price of a house was up 7.6% from last year to £177,533. However, on a monthly basis prices were down -3.9% from £184,676.
Shipside said: “While confidence can be fragile, it is currently riding high. It seems that most home-owners are not worried by the risk of 2016 rate rises, with only one in seven thinking their financial situation will deteriorate. Home-owners have had a smooth ride over the past six or so years with a half-a-percent base rate, so you would think that more might have concerns about the extra drain on their financial resources when the base rate inevitably goes up. Whether in 2016 or early 2017, a rise won’t come as a surprise as an increase has been well-trailed.”