Asking prices of property coming onto the market fell by 2.9 per cent in August, according to Rightmove, representing the biggest fall the firm has ever witnessed.
It cited a ‘summer sales’ attitude to pricing, suggesting that a slower market signals good news for buyers and relieves pressure on the Bank of England.
Prices were down by £7,758 compared with last month, with Rightmove suggesting holiday distractions were a key driver, although it noted that the drop was more pronounced than usual, with London in particular down 5.9 per cent.
The average price is now nearly £10,000 off June’s peak and annual rates fell back from 6.5 per cent in July to 5.3 per cent in August.
Miles Shipside, director at Rightmove and housing market analyst, said that a drop in August is typical but it has been steeper than expected this year.
“Both buyers and sellers are becoming increasingly aware about personal finances, given that the cost of mortgages are going up and regulators are trying to bring availability down. This limits what buyers are willing or able to pay, and helps moderate sellers price expectations.
“The second factor is the turnaround in London. Having forced national average prices up for the last two years, it’s now pushing them down with three falls in a row, and a real biggie this month.
“Holidays always cause a big price reverse in the capital, but there is also a massive year-on-year jump in the number of newly-marketed properties, up 20 per cent compared to August last year, and double the figure seen in any other region. More sellers and fewer buyers mean price falls.”
Rightmove said that this month’s fall has caused a substantial drop in the annual rate of increase, however new seller asking prices are still 5.3 per cent higher than they were a year ago.
The firm also said that activity is traditionally strongest in the first half of the year, with this year seeming to follow that trend.
