The UK housing market is showing signs of stagnation, with average asking prices in former 'hotspots' dropping by as much as £100,000, according to a study by estate agent website Rightmove. Prices have continued to fall in the South of England over the past month, with some areas in London experiencing declines of over 15% compared to last year.
Rightmove reports that the annual rate of house price growth has fallen for eight consecutive months to 12.4%. The number of properties on the market has decreased by 22,000, and the average time to sell a home has increased from 57 days in March to around 70 days. A lack of first-time buyers and rising unemployment in manufacturing are contributing to a gloomy outlook.
East Anglia saw the biggest markdown, with average prices falling by 3.6% to £156,599. In Greater London, average prices dropped by 1.4%, but variations are significant: Westminster saw a 17.2% decline (£105,252) to an average of £506,000, while Camden prices fell by 16.3% (£71,000) to £363,965. Ten other London hotspots also recorded falls, including Tower Hamlets, Richmond, and Brent.
In contrast, the North of England saw a 4.5% increase in asking prices, with the average home costing just over £114,000. The North West and Yorkshire and Humberside also experienced rises of 2.2% and 1.8% respectively. Rightmove's commercial director, Miles Shipside, noted a 'belated summer pick-up' in the South but said it had not reversed the downward trend.
A separate study from The Woolwich predicts that house price growth will slow to 8% by Christmas, citing first-time buyers being priced out, high personal debt, rising unemployment, higher taxes, and low wage rises. Andy Gray, head of mortgages at The Woolwich, commented: 'The confidence bubble we have seen over recent months may have finally burst.'
