New sellers are now starting to outnumber new mortgage approvals by 5.2, Rightmove has announced.
The number of unsold properties staying on agents’ books has jumped by almost 25% in the first six months of this year.
Rightmove – which has some 90% market share – reports that more than 30,000 new properties are coming to the market each week, up by 45% on last July. Asking prices for properties new to the market are, however, finally dropping.
Rightmove reports that over the last month, they have come down by 0.6% – the first fall this year. But with the average asking price now £236,332, there is still a huge gap between sellers’ expectations and the reality of mortgage-approved prices as reported by Halifax and Nationwide. Halifax is quoting £166,203 and Nationwide £170,111.
Rightmove is now forecasting more falls in asking prices as the year goes on. Commercial director Miles Shipside said: “The number of new mortgages being approved each month is less than half the number of new sellers, with the imbalance being exacerbated by the increase of nearly 50% in the number of properties coming to the market compared to a year ago. “More aggressive pricing is now the order of the day.” He went on: “Estate agents are suffering from podgy portfolios and buyers’ fitness to purchase is in correspondingly poor shape. With agents beginning to choke on a surfeit of new stock, sellers are going to have to price at bargain levels.”
He warned: “The tradition of testing the water at a higher figure before reducing at a later date will backfire in areas of excess supply, as over-ambitious sellers will have to cut back even more as they chase prices downwards.”
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