The average asking price for newly listed properties has increased by 0.4% this month, or +£1,517, bringing the national average to £370,257, according to the latest data from Rightmove.
Despite this monthly increase, prices are now 0.1% lower than they were at this time last year, reflecting a sustained period of subdued price growth.
The slight annual dip in prices is largely driven by London and the South of England, where the market is underperforming relative to the rest of Great Britain.
The West Midlands (-0.1%) is the only more northern region to record a yearly drop in new seller asking prices. In the South West, prices are down by 1.3% compared with last year, while in the North West they’re up by 3.2%, highlighting the south’s underperformance.
The decade-high number of homes for sale is more pronounced in the south of England, contributing to the lower pricing, as sellers look to stand out among the more plentiful competition.
The number of homes for sale in the south of England is up by 9% on this time last year, compared to 2% across the rest of Great Britain. It also takes an average of five days longer to find a buyer in the south of England than in the north and Wales, while Scotland is much faster than other regions.
However, the overall number of sales being agreed is up by 4% on last year. While this figure is 5% higher in areas outside London and the south of England, the south has still seen a 3% increase in sales year-on-year. This highlights that despite some regional challenges, buyers are still active in these areas for the right property at the right price.
Rightmove’s real-time market data has detected no immediate sign of movers changing their plans due to stamp duty and mansion tax rumours. However, jitters caused by the uncertainty over what could happen in more than two months’ time risk slowing the parts of the market which would be most impacted.
Rightmove’s analysis highlights how both tax changes would disproportionately affect London and higher-priced areas, and risk exacerbating regional divides. If the government changed the way stamp duty works on properties over £500,000, more than half (59%) of sales in the capital would be affected.
By contrast, it is 22% on average across the rest of England, and in the North East it is just 8%. Furthermore, more than one in ten homes (11%) in London are priced at £1.5 million pounds or more and would be subject to the rumoured mansion tax, versus an average of just 2% outside the capital.
September’s Bank of England rate decision is widely expected to be a hold rather than a cut. We’re now just over a year on from the first Bank Rate cut in over four years in August 2024. Since then, the average two-year fixed mortgage rate has reduced from 5.03% to 4.52%.
For someone buying a home at the average asking price, this equates to a saving of just under £100 on monthly mortgage costs, based on having a 20% deposit and spreading the cost of the mortgage over 30 years. Improved buyer affordability, sensible pricing, and high choice of property are encouraging many to buy.
Rightmove’s Colleen Babcock said: “Rumours of property tax changes began swirling in mid-August, and with the Budget itself not arriving until the end of November, this kind of extended uncertainty can affect market activity, especially in the higher price brackets.
“Movers want to be confident in planning their moving costs. Our real-time data has not yet picked up any major shifts, however it’s understandable that those who could be negatively affected by the rumoured changes might be in the process of reassessing their short- and medium-term plans.
“Our analysis highlights how London and south England-centric the changes would be, and these are the areas that are already performing less strongly.”
Read the orginal article: https://propertyindustryeye.com/asking-prices-rise-but-rumoured-property-tax-changes-stir-market-concerns/
