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Sellers of high-end homes forced to slash asking prices

Sellers of high-end properties – mainly in the south-east of England – are having to slash their asking prices to force a sale, a leading survey shows.

As the property market made a sluggish start to 2018, two-thirds (67 per cent) of estate agents said that the sale prices on properties marketed at £1million-plus were coming in below what the vendor had asked.

The survey by the Royal Institution of Chartered Surveyors found that the figure was 56 per cent for properties listed between £1million and £500,000.

Rics said that while the more expensive tiers of the housing market continue to experience tougher conditions, at the cheaper end sales were ‘solid but unspectacular’.

Activity in the property market was subdued in January, with new buyer inquiries falling for the 10th month in a row, the Rics report said.

Sales levels and the flow of fresh properties coming on to the market also drifted lower. The average number of properties on estate agents’ books continued to slip back towards the record low levels seen around the middle of last year. 

Brian Murphy, Head of Lending for Mortgage Advice Bureau, noted that the low level of new seller instructions will impact on the amount of buyer enquiries received ‘as a bottleneck of properties available will inevitably stifle choice and therefore purchasing activity, even if demand is evident’.

He added that, ‘On a national basis, whilst the near-term view on pricing may be slightly downbeat, the report does indicate that many surveyors believe that the twelve month view on the UK property market is still one of stability and modest growth, with eleven of the twelve regions expecting to see prices increase over the course of 2018 and only surveyors in London expecting to see value continue to slide in the long term.’

Halifax yesterday revealed that the average UK house price fell by 0.6 per cent in January compared to the previous month, a slightly smaller drop than December’s rate of 0.8 per cent.

But on an annual basis the mortgage giant said the property market is still rising: the average house price rose by just £4,068 in the year to January to £223,285, or an increase of 2.2 per cent.

Rics said that while the more expensive tiers of the housing market continue to experience tougher conditions, at the cheaper end sales were ‘solid but unspectacular’.

For properties marketed at up to £500,000, the majority (58 per cent) of surveyors noted sales prices were coming in at the same level as asking prices or slightly above, while 42 per cent said they were below.

While sales levels are generally expected to remain flat over the coming few months, they are expected to have picked up by the coming 12 months, Rics found.

A net balance of 8 per cent of surveyors saw prices increase rather than fall month-on-month – suggesting modest price growth, the report said.

House prices continued to fall in London, and to a lesser extent in the South East of England, East Anglia and the North East of England.

At the other end of the spectrum, the North West of England, Northern Ireland and Wales saw the strongest price growth. House prices were also rising in Scotland in January and they are predicted to continue to do so over the near term, but at a slower pace.

Looking 12 months ahead, house prices are expected to head upwards across the UK apart from in London.

Simon Rubinsohn, Rics chief economist, said a lack of properties on the books continues to provide a ‘major challenge with the number of valuations being undertaken not suggestive of a pick-up in new supply anytime soon’.

He said: ‘Divergent regional trends remain very much to the fore with the market in many parts of the country still actually behaving in a solid if unspectacular way.’

Mr Rubinsohn said affordability issues continue to play a key role – with those areas where house price earnings are most stretched seeing the softest markets.



Read more at DailyMail.co.uk


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