By David Milliken
LONDON (Reuters) – Average asking prices for newly listed houses and apartments in the UK fell by 1.9% in December, more than the historic average decline for the final month of the year, figures from property website Rightmove showed on Monday.
Prices were 1.1% lower than a year earlier, the data showed.
The weakness contrasts with data from mortgage lenders Halifax and Nationwide over the past two weeks, which showed modest monthly price rises, suggesting that the past year’s fall in house prices had bottomed out.
“Further price falls beyond the usual seasonal trends that we’d expect at this time of year signal that some new sellers are continuing to act on the advice of agents to price competitively,” said Rightmove director Tim Bannister.
Asking prices are likely to drop another 1% in 2024, Rightmove said, with affordability still stretched despite signs that mortgage rates are now past their peak.
Rightmove data is not seasonally adjusted, and on average over the past 20 years asking prices have fallen 1.5% in December. The December period covers new property advertised between Nov. 5 and Dec. 2.
Prices rose by more than a quarter between the start of the COVID-19 pandemic in February 2020 and September last year, according to official data, boosted by record-low interest rates and a greater demand for living space during lockdown.
A surge in official interest rates from 0.1% in December 2021 to a 15-year high of 5.25% this August, combined with high inflation squeezing households’ disposable income, has led to a small decline in house prices over the past year.
Rightmove said the number of sales agreed so far this year was 13% lower than over the same period last year, adding that this was less of a drop than it had expected, given the very high number of house purchases in early 2022.
(Reporting by David Milliken; Editing by Susan Fenton)