Overabundance of properties available for purchase in southern England leads to decrease in asking prices, according to Rightmove report
In Britain, the property market continues to show signs of resilience, despite ongoing economic uncertainties. According to data from Rightmove, the average asking price for a property in Britain currently stands at £370,257, a 0.1% decrease compared to a year ago.
The monthly price rise of 0.4% in September marks the first increase since May, offering a glimmer of optimism for sellers. However, this figure is slightly lower than the typical 0.6% rise expected for this time of the year.
The housing market in southern England is experiencing a surge, with the number of homes for sale increasing by 9% compared to a year ago. Conversely, the north east and north west are witnessing a more subdued market, with median home prices around five and six times median earnings, respectively.
In contrast, the south east and London see median home prices at around 10 and 11 times median earnings, respectively. These regions have been the most affected by the recent stamp duty changes, which disproportionately impacted London and the south east.
The number of agreed sales in Britain has risen by 4%, with a 3% increase in the south. Colleen Babcock, property expert at Rightmove, attributes this uptick in sales activity to "sensible and attractive seller pricing".
Mortgage rates have been on the rise, with the average two-year fixed mortgage rate currently at 4.99%, and the average five-year deal at 5.03%, according to financial information site Moneyfacts. Matt Smith, Rightmove's mortgage expert, noted that mortgage rates have edged upwards over the last few weeks.
Borrowing costs remain high, and inflation concerns could encourage the Bank of England to keep interest rates on hold for the rest of the year. This could potentially dampen the recovery momentum in the property market.
Property market confidence dropped in August due to pre-Budget jitters, according to the latest sentiment survey from the Royal Institution of Chartered Surveyors (RICS). Speculation about property taxes has dominated headlines in the lead up to the Autumn Budget, with rumours of a potential annual property tax on homes worth more than £500,000 and the possibility of charging capital gains tax on the sale of main residences exceeding a certain value, such as £1.5 million.
The UK government is planning to implement changes in property taxation from November 2024, which could particularly affect the southern part of England. If these tax changes do materialise, they could impact affordability-stretched areas where buyers are already struggling to take their next step up the property ladder.
Competitive pricing is considered "vital" in the current housing market. With the ongoing economic uncertainties and potential tax changes, it remains to be seen how the property market will fare in the coming months.
Read also:
- Federal petition from CEI seeking federal intervention against state climate disclosure laws, alleging these laws negatively impact interstate commerce and surpass constitutional boundaries.
- Duty on cotton imported into India remains unchanged, as U.S. tariffs escalate to their most severe levels yet
- Steak 'n Shake CEO's supposed poor leadership criticism sparks retaliation from Cracker Barrel, accusing him of self-interest
- President von der Leyen's address at the Fourth Renewable Hydrogen Summit, delivered remotely
