House sellers’ average asking prices dip by £1,500 in November

The average price tag on a home is around £1,500 lower this month than a record high reached in October, according to a website.

Across Britain, the average asking price for a home coming to market in November is £322,025.

This is 0.5% or £1,505 lower than in October, when house sellers were typically asking £323,530 – a record high amount for the index from Rightmove.

Despite the dip, asking prices are still 6.3% higher than a year ago.

Rightmove said market activity is high as buyers are looking to beat a stamp duty holiday deadline on March 31 2021.

It said the number of sales currently in the pipeline is up compared with a year ago.

The more expensive regions of southern England are experiencing a particularly high sales boost, with a 72% uplift in the number of sales agreed in the East of England, and a 69% uplift in the South East, Rightmove said.

Rightmove suggested new sellers appear to be pricing more keenly, to improve their chances of getting a quick sale and beating the March stamp duty deadline.

Sellers also need to be realistic about achievable prices. With many households having suffered income hits in 2020 and lenders also tightening up their mortgage criteria, some buyers may have reached the limits of what they are able to pay.

Tim Bannister, Rightmove’s director of property data comments: “Given the ongoing mini-boom, prices might have been expected to rise again this month, but instead we have a slight dip which could be a result of some new sellers pricing more realistically to have a better chance of agreeing a sale in time to benefit from the stamp duty savings on their onward purchase.

“We know from a recent Rightmove study that sellers are twice as likely to sell if they agree a sale based on the first price at which their property goes on the market, something that’s even more important now as we move towards the end of March and the end of the stamp duty holiday.

“If your initial asking price is too high then you’re less likely to get an offer even after you’ve cut your price back to a more realistic level. Our revised prediction of a 7% annual increase in prices in 2020 looks to be on track, since the annual rate has jumped to 6.3% with a month to go.”

Bruce King, director of Cheffins in Saffron Walden, said: “Transaction levels have gone through the roof in comparison to the past couple of years due to the monumental backlog of people looking to move.

“Political uncertainty, Brexit and the first lockdown period caused many who were considering moving to sit on the fence, however the announcement of the stamp duty holiday was the trigger for many of these to bite the bullet and get on with moving house.

“This, coupled with the change in lifestyle which has been caused by the coronavirus outbreak, has created a pressure cooker in the market which has resulted in activity which couldn’t have been foreseen around a year ago.

“The market in the £400,000 to £500,000 bracket is certainly the most busy, mainly made up of second-steppers and upsizers.

“First-time buyers are continuing to struggle, as the level of deposit needed has increased and this, combined with a lack of job security for many, has meant that mortgage agreements have been harder to come by as banks change their lending criteria.”

Andy Shepherd, CEO of Dexters, said: “London remains a huge draw for investment and city living, and we currently have over 100,000 people registered looking for a new home or investment property, up 25% compared with this time last year.”

Lawrence Bowles, residential research analyst at Savills, said: “Our advice to clients has always been to remain realistic with pricing to ensure buyer and seller expectations are aligned and to ensure a speedy sale.

“It’s important to note that these figures are asking prices, not achieved values. Over the summer, we’ve seen a lot of activity from upsizers looking for more space, for example a room to work from home or a larger garden.

“It’s therefore possible that what we’re seeing here is the latter part of the chain as they start selling their former, smaller homes.

“In this case, lower asking prices are precisely what you’d expect to see.”