Asking prices for property dip as home sellers 'get real' to beat stamp duty deadline

Asking prices for property dip as home sellers ‘get real’ in bid to complete deals before stamp duty deadline

  • Some 0.5% was shaved off the average home placed on Rightmove in October compared to  September
  • Sellers pricing ‘realistically to get deals through before stamp duty deadline 
  • Home sales were up a substantial 50 per cent on October last year in England, Wales and Scotland

The average asking price for properties dipped slightly in October as home sellers look for a quick sale to beat the stamp duty deadline, according to a leading property website.

Half a per cent or £1,505 was shaved off the average home placed on Rightmove compared to September, which suggests a pause in the house price mini-boom experienced in most areas of the country since the first lockdown ended.

The cooling of the market comes despite strong demand from buyers reported by the portal, which said home sales were up 50 per cent on October last year in England, Wales and Scotland – the countries covered by the index.

Rightmove said there was stronger growth in activity in the higher price bands, where buyers stand to make the biggest stamp duty savings.

Rightmove said there was stronger growth in activity in the higher price bands, where buyers stand to make the biggest stamp duty savings.

Rightmove measured 112,574 asking prices this month in England, circa 95% of the UK market. The properties were put on sale by estate agents from 11 October to 7 November and advertised on Rightmove.co.uk.

Rightmove measured 112,574 asking prices this month in England, circa 95% of the UK market. The properties were put on sale by estate agents from 11 October to 7 November and advertised on Rightmove.co.uk.

Rightmove’s Tim Bannister said 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’.

He added: ‘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.’

He said that Rightmove’s prediction of a 7 per cent annual increase in prices in 2020 looked to be ‘on track, since the annual rate has jumped to 6.3 per cent with a month to go’.

The report suggested the new lockdown did not appear to be denting buyer enthusiasm. As uncertainty over rules abated and it became clear the housing market was remaining open, buyers jumped back into action, with the first six days of the second lockdown seeing demand up by 49 per cent on this time last year.

Regionally, the South performed best relative to last year for the number of sales agreed, up by 72 per cent in the East of England, and up by 69 per cent in the South East.

Regionally, the South performed best relative to last year for the number of sales agreed, up by 72 per cent in the East of England, and up by 69 per cent in the South East.

That determination to press ahead with moving home might have been given a shot in the arm by the vaccine news last week, according to another property expert.

Jeremy Leaf, North London estate agent and former chairman of the Royal Institution of Chartered Surveyors said that most buyers and sellers ‘are aware that delays in arranging mortgages, surveyors, searches and conveyancing due to the busier-than-expected post-lockdown uplift has meant meeting that deadline could be touch-and-go even if agreeing terms in the next few weeks’.

The trend for asking prices has clearly been upwards over the last five years.

The trend for asking prices has clearly been upwards over the last five years.

‘On the other hand,’ he added, ‘the likelihood of a vaccine sooner rather than later may perversely stiffen the resolve of some sellers not to accept low-ball offers so agents will need to brace themselves for a bumpy ride.’

Mr Leaf noted that while he has seen ‘little evidence of previously-agreed sales being renegotiated or buyers and sellers withdrawing from transactions’, October marked a pause in the ‘strong improvement in sales activity during July, August and September’.

The lastest Rics survey of estate agents last week suggested that activity in the housing market has slowed down after a surge in recent months.  

There has been a huge increase in transactions compared to last year and properties are selling much faster, the rightmove survey shows.

There has been a huge increase in transactions compared to last year and properties are selling much faster, the rightmove survey shows.

While October saw buyer demand, sales and prices remain solid, the longer-term outlook for the market looks ‘subdued’, Rics warned.

Rightmove said there was stronger growth in activity in the higher price bands, where buyers stand to make the biggest stamp duty savings. 

The number of sales being agreed for properties priced at between £100,000 and £200,000 was up by only 16 per cent on this time last year, which ‘contrasts with sales agreed more than doubling (+106 per cent) in the £400,000 to £500,000 price band’. 

Likewise more expensive properties are moving faster. Rightmove said the average time to secure a buyer was at a new record low of 49 days, but that the £400,000 to £500,000 price band saw a drop of 23 days, while the £100,000 to £200,000 band saw a drop of just eight days.

Regionally, the South performed best relative to last year for the number of sales agreed, up by 72 per cent in the East of England, and up by 69 per cent in the South East. Nationally, sales agreed were up by 50 per cent on this time last year, a softening from the 70 per cent year-on-year jump recorded in Rightmove’s September report. 

Price predictions: Property prices have been rising in recent months but could start to fall, according to the Royal Institution of Chartered Surveyors' October survey.

Price predictions: Property prices have been rising in recent months but could start to fall, according to the Royal Institution of Chartered Surveyors’ October survey.

source: dailymail.co.uk