Rightmove has reported that average new seller asking prices fell by £82 (-0.0%) in June to £372,812, the first monthly drop in asking prices this year and the first drop seen in the month of June since 2017.
Its latest report said asking prices set to fall in most months for the rest of the year in line with the usual seasonal pattern, and Rightmove still predicts an overall 2% annual drop in new seller average asking prices by the end of 2023.
Despite some significant increases in mortgage interest rates over the last few weeks, Rightmove’s statistics currently show no effect on buyer demand but a slight impact on sales activity. Buyer demand over the last two weeks is 6% higher than the same period in 2019’s more normal market, but the number of sales being agreed has dropped marginally, and in the last two weeks is 6% behind the same period in 2019 compared to being 3% behind in May.
Tim Bannister Rightmove’s director of property science, said: “Average new seller asking prices, the first and leading indicator of new trends in the market, have dropped slightly this month, signalling that the belated spring price bounce has quickly turned into an earlier than usual summer slowdown.
:We expect asking prices to edge down during the second half of the year which is the normal seasonal pattern, and while we sometimes re-forecast our expectations for annual price changes at this time, current trends suggest that our original forecast of a 2% annual drop in asking prices at the end of 2023 is still valid. Agents report that new sellers are sitting in two camps – those who still have overoptimistic price expectations following the buoyant pandemic market, and those who have adapted to the new conditions and are coming to market with a competitive price.
“Sellers who price competitively are much more likely to find a suitable buyer quickly before their home appears stale, and they can often then negotiate on price on any onward purchase.”
Emma Cox, managing director of real estate at Shawbrook, added: “The housing market continues to face challenges with confidence amongst buyers impacting prices. The combination of high interest rates and inflation continues to be a heady mix, prompting buyers to remain hesitant. However, professional investors and landlords may find this an optimal time to add to their property portfolio, making the most of deals within the market.
“Despite all of these headwinds for landlords, demand for letting residential property remains high with tenants competing for limited stock.”