Property asking prices fall in July

House and coins

The average price of property being put up for sale in the UK has fallen for the first time in 2014, down by an average of £2,116 in July.

According to research by estate agent Rightmove, the average asking price of houses going on to the market fell by 0.08% in July compared to the previous month, down just over £2,000 to £270,159.

Rightmove said in its report: “There is evidence that the frenetic activity seen in some areas during the first half of the year is cooling, in part due to stricter mortgage eligibility criteria and previously pent-up demand having now been partially satisfied.”

However, it added that the significance of this slowdown should not be overstated, and a price cooling in July has been recorded in six out of the past 10 years, suggesting a normal seasonal slowdown.

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Buyer confidence

Despite being slightly down compared to June, the July figure is still 6.5% higher than that of July 2013, and the company predicts that by year end the new seller asking price will be up 8% compared to 2013.

Rightmove director Miles Shipside adds: “Buyer confidence may also have taken a knock, with suggestions that mortgages are becoming harder to get, and repayments may get more costly sooner than originally anticipated if the rumours of an interest rate rise before the next election come true.”

The firm speculates that the Mortgage Market Review and additional high loan-to-income and stress-testing guidance have had a cooling effect on the market.

However, it adds that Bank of England mortgage approvals are amounting to 60,000 per month on average, 23% higher in the year to date than during the same period of 2013.

This article was written for our sister website Money Observer