Brian Murphy Head of Lending for Mortgage Advice Bureau comments:
“The monthly Rightmove House Price Index provides us with an up to date view of consumer sentiment and activity in terms of the UK property market, rather than historical data using completed transaction figures. This latest report indicates a widening gulf between the expectations of vendors and the affordability of buyers. Just because there are few properties on the market in any one conurbation, that doesn’t necessarily mean that vendors are able to ambitiously price their property if they want to achieve an actual offer. The fact that transaction levels appear to have dropped would perhaps evidence this. It’s also perhaps reasonable to suggest that the ongoing lack of available properties for sale is somewhat a self-fuelling cycle, as if there is not a lot of choice for buyers who then can’t find what they are looking for, they simply don’t list their own property for sale, and so it goes on, bringing the market to a grinding halt as a result.
Going forwards, the savvy agents out there are likely to be pricing properties at more realistic levels in order to achieve a timely sale, and those who want to sell would do well to listen to their agent’s advice. This isn’t the market to try to break the ceiling price for the road, regardless of how few properties are available for sale. Overheating markets generally result in mortgage down-valuations, a situation which everyone involved wants to avoid, but the only way of doing so is ensuring that asking prices are within reasonable expectations of both buyer affordability and market sustainability. Perhaps as now the weather is improving and those whose properties have gardens which are now in bloom are more likely to consider listing for sale, we may see the market also begin to perk up as more choice for buyers may change the current dynamic. Otherwise, we could be in for a bit of a sluggish summer in many areas, regardless of how high asking prices reach.”
Read the full Rightmove report here.