Sellers have bumped up the asking prices of UK houses by 3.5 per cent (about £8,310) in October, according to Rightmove’s monthly report.
Although prices in England and Wales are 1.5 per cent higher than a year ago with a typical property averaging at £243,168, sales may not follow through.
“If [estate agents] agree to over-ambitious pricing to please a seller,” Miles Shipside, director and housing market analyst at Rightmove, said on the company’s website, “… it could curb a potential buyer’s enthusiasm to arrange a viewing if the over-priced alarm bell starts ringing.”
“Pricing high with a view to negotiating down can work in a market where buyers are less price-sensitive,” Shipside said. “But remember our research also shows that properties in the upper price quartiles have performed best since the onset of this economic downturn.
“Most property values are still below previous peaks, so some sellers may need to price more keenly to be a more compelling buy.”
Commenting on London prices, which saw a 4.8 per cent (+£21,834) jump in average new-seller asking prices during October, Shipside said: “This month’s jump of more than £21,000 in new sellers’ asking prices is partly a bounce after the Olympic-induced activity doldrums.
“Some Londoners, especially those in the upper price brackets, had the option or sense to delay marketing their properties. This has resulted in a new average record high, beating the previous record set in June by £631.”
In Kensington and Chelsea, the most expensive London borough, new-seller average asking prices are in excess of £2.2 million.
In June, national sellers’ prices were up 2 per cent compared to August 2007, just before the run on Northern Rock, but compared to retail price inflation over the same period they were 13 per cent lower.
In July, August, and September, the asking prices of properties coming to the market fell by 4.6 per cent (-£11,377). This was deemed to have been caused by the distraction of the Olympics.
October and November are traditionally good months for the property trade with estate agents making eager activity before the winter lull.
The October increase could be seen as speculation by sellers as there are few new houses coming on the market.
However, other Rightmove statistics show that most buyers will not look at houses they consider over-priced, so price rises may not produce sales.
Shipside also said estate agents are reporting that mortgages are still difficult to obtain, with risk-averse lenders nitpicking the mortgage application paperwork “even from buyers who seem squeaky clean”.
More than 90 per cent of all the UK’s over 20,000 estate agents and developers are members of Rightmove.
In Scotland, the average cost of a home was down 1.2 per cent in August to £143,867, making it the biggest monthly fall in prices since March 2009.
The latest LSL/Acad Scotland House Price Index shows the average house price has now returned to its November 2009 figure.
Edinburgh remains Scotland’s most expensive area, with the average home costing £219,918—up £4,896 on last year.
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