Rightmove: Property asking prices up just £14 in small January rise

Home sellers are downgrading their ambitions and being slightly more realistic with asking prices, says property listing giant Rightmove.

The average price of a newly-listed home for sale in the last month was £362,452 – £14 higher than the previous month, according to the property website. 

This was the smallest rise Rightmove had recorded between January and February in records going back to 2001, but it was still up 3.9 per cent on a year earlier.

Increasing numbers of buyers are said to be snapping up properties again after confidence was rocked by the mortgage rate spike, as the market staged a stronger than expected start to 2023. 

But the number of sales agreed was still down 11 per cent on 2019. This is an improvement on the 15 per cent decline seen at the start of the year and the 30 per cent decline in the aftermath of last autumn’s mini-Budget. 

Meanwhile, there were 24 per cent fewer homes for sale compared with 2019, but more choice than a year ago.

Rightmove’s figures show that the first-time buyer market is recovering better than the upper-end. First-time buyer sales are down only 7 per cent on 2019.

The signs of more life in the property market come as fixed mortgage rates continue to fall, with the best five-year fixed mortgages now on offer below 4 per cent and the average  deal at 5.05 per cent – compared to a peak of abut 6.5 per cent in autumn. 

Tim Bannister Rightmove’s director of property science, said ‘The big question this month was whether we would see new sellers increasing their asking prices as has been the yearly norm as we approach the spring selling season. 

‘This month’s flat average asking price indicates that many sellers are breaking with tradition and showing unseasonal initial pricing restraint.

‘In addition to market conditions demanding greater realism on price, we are transitioning into a slower-paced market, where buyers will take longer to find the right property at the right price due to the higher cost of servicing a mortgage.

‘There are other indicators that this will be a softer rather than a hard transition despite the turbulence at the end of 2022.’

House prices dipped slightly in February on an annual basis but remained flat month-on-month

The average home loan rate has fallen to 4.82 per cent.

Alexander James McNeil, of Huddersfield-based estate agent Bramleys, said: ‘December was the poorest month we’ve had in ten years. 

‘Normally, we sell around 35 properties a month, but in December we had just eight sales. 

‘Now, new stock is coming onto the market and we’re doing multiple viewings per property again – it seems buyers and sellers are far less nervy and we’ve returned to a ‘normal’ market.’ 

Simon Woodcock, of estate agents Robinson Michael & Jackson in Kent, said: ‘We saw an increase in seller activity in January. 

‘The market has moved to a better balance of supply and demand – we are seeing some potential 2022 sellers take the plunge early in 2023.’ 

Last week, the ONS said property values slid by £2,000 between November and December – a lower drop than anticipated by experts. That came after Halifax said home values stabilised in January after three months of falls. 

According to Rightmove, Scotland saw the biggest rebound, with a monthly 7.5 per cent rise in asking prices. It is also the fastest spot to sell a home after listing, taking 51 days. London homes recorded asking price rises of 2.1 per cent over the month and Yorkshire and Humber 1.9 per cent. 

In the East Midlands asking prices dropped 2.3 per cent. Rightmove says the capital is the slowest region to sell a home. It took 74 days on average – some three weeks longer than Scotland. 

Tim Bannister, from Rightmove, said: ‘There are indicators that this will be a softer rather than a hard transition despite the turbulence at the end of 2022. 

‘The frantic market of recent years was unsustainable in the long term, and our key indicators now point to a market which is transitioning towards a more normal level of activity after the market turbulence at the end of last year.’