Rightmove: Some sellers are still ‘too optimistic’ on pricing

Asking prices have fallen by the largest level since March 2019 and discounts are at their highest in more than a decade as the subdued property market continues, Rightmove data shows.

The latest Rightmove House Price Index for September shows the average asking price of newly marketed properties has fallen 0.4% annually to £366,281.

Asking prices are up 0.4% on a monthly basis, which compares with an average of 0.6% recorded in the same period over the past 10 years, Rightmove said.

The portal said that while some sellers are clearly being “too optimistic” on their pricing, it does appear that others are listening to their agents’ advice to price correctly from the outset. 

The property website said 36.3% of properties currently for sale have had a price reduction, with an average reduction equating to £22,700 or 6.2% nationally.

Both figures are the highest since January 2011 and above the pre-pandemic five-year average of 31.2%.

The number of sales being agreed in August across all property types is also 18% down versus August 2019. First-time buyer properties are faring slightly better though, with a drop of 13%.

Rightmove said there are signs of activity starting to pick up, with back-to-school sellers helping the number of new properties coming to market to jump by 12% in the first week of September when compared with the average weekly number throughout August.

Looking by sector, the first-time buyer sector saw new listings up by a smaller 7%. New listings in the second stepper sector are up by 11% on the same period, and the top of the ladder, although a smaller proportion of the overall market, has seen new listings up by 24%.

Based on the latest report, Rightmove said it is sticking to its prediction of a 2% drop in asking prices this year.

Tim Bannister, director of property science for Rightmove, said: “It’s been a slower than usual August, so all eyes will be on market activity over the next few weeks, which will set the trend for the rest of the year. The combination of 14 consecutive Bank of England interest rate rises and many buyers and sellers still catching up on lost pandemic holidays has contributed to a bigger than expected summer lull, though we still anticipate an autumn bounce. Market conditions still vary considerably in different locations, and so a local estate agent will be best placed to advise sellers to give them the best chance of finding a buyer this autumn.
 
“As we enter a key selling season, more people who have been thinking about what they need from a home and where they want to be living next year and beyond are taking action and coming to market. 

“This has helped to improve buyer choice, especially for those looking for larger homes, which also means that new sellers in the middle and upper sectors need to be extra careful not to set their price expectations too high. Plenty of sales are being agreed for properties that are priced at the right level, and those that are selling are still taking five days less than at this time in 2019. We’re also seeing the number of fall-throughs decline as market conditions and mortgage rates stabilise.”