UK House Prices

Are property prices really rising in the UK?  Here are http://www.scottishhousemove.com we think prices have remained flat if not dropped in the UK in 2010.  However, most agencies who report on property prices agree that prices have rises year on year.

In October 2010, rightmove the UK’s largest property website recorded a 2.9% year on year change.  However, while both the Halifax () and Nationwide () reported rises they were on a smaller scale.

Rightmove had some other interesting stats regarding the market.  November sellers cut their asking prices by 3.2%, the biggest monthly drop since December 2007.  Falls now recorded in 4 out of the last 5 months, as year-on-year price growth heads for zero.  24,028 new sellers coming to market per week, down 9.1% on previous month yet still outstripping muted mortgage approvals by 2 to 1

Unseasonally high number of unsold properties and longest ever time on the market mean sellers face tough competition, while winter buyers hang back waiting for bargains.

So are property prices really rising?  Ask an Online Estate Agent  or any other estate agent and they will tell you the same story.  Prices are very much static and in most areas prices are dropping as sellers reduce their prices in order to secure a sale.  Buyers especially those who have sold or are in no chain are bargaining hard and seeing thousands knocked off asking prices.  Is it just the time of year we hear you ask?  Our sellers are using any reduction in their asking prices to secure a reduction on their purchase, which in our view is what you have to do.

So what about the prospects for 2011? Will cautious sellers come to the market or not?  Well as in every other down turn in the property market, people still need to move.  Family’s need larger properties, the owners of the big house need to trade down, the young couple want to move in together, the old couple who want to move out to go their separate ways, so the market trundles along.  But it does not look good for 2011.  VAT goes up to 20% in January 2011 and public sector jobs are under threat.  And on that thought what is the Government doing to stimulate the market?  Nothing in my view.  Banks need to start lending or be forced to lend.  Government needs a clear strategy or even a strategy would be a good start. 

Some corporate estate agents are even having Christmas sales in their offices to sell their stock.  In our view this is simply so they can get some sort of commission, rather than a real effort to sell their client’s property.  In fact we calculated one branch in one week knocked off £550,000 across their clients asking prices.

So are prices actually increasing?  Maybe in London, rich Arabs and others are buying due to the value of the pound but outside London we think not.