Thursday, Jul 02, 2015

UK house prices declined between May and June against expectations of a further increase.

WBPOnline: UK House Prices Unexpectedly Decline in June

London - House prices in UK fell by 0.2% between May and June which led to the annual price index decelerating to two-year low of 3.3%, down from 4.6% a month before, according to the mortgage provider Nationwide. Both figures missed the market expectations of a further increase in price growth.
Unlike Nationwide, property portal Rightmove informed that the earlier average asking price increased by a record high 3%, or £8,500, between May and June.

Posted by cornishman @ 08:24 AM (6068 views)
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1. nickb said...

So after a collective wetting of pants with excitement amongst the property speculators at the conservative victory, and the finance-subservient mainstream media, the prices actually blip downwards. I can't suppress a warm, smug, gloaty feeling. If only this were the start of a sustained HPC. Come on Greeks, vote no!

Thursday, July 2, 2015 11:57AM Report Comment

2. cornishman said...

Just done a search on Zoopla using the first half of a Cornish postcode - and then sorted them according to 'Most reduced'. 176 houses for sale. 82 of them are showing as having reduced asking prices.

Thursday, July 2, 2015 01:14PM Report Comment

3. Dharmin said...

All depends on the location.. In Uxbridge not seen price fall

Thursday, July 2, 2015 10:07PM Report Comment

4. cornishman said...

Dharmin - when I put the comment above I was half hoping that others would check their area and post their results. Given that no-one but you has done so far, I checked a few other random postcodes:

Bristol BS8: 15 reduced of 53

Birmingham B8: 33 reduced of 160

Manchester M8: 44 reduced of 128

Glasgow G84: 58 reduced of 175

Hornsey N8: 39 reduced of 122

Uxbridge UB8: 19 reduced of 102

Not sure what to make of all the above, or even if it's of any relevance. Maybe all it shows is that estate agents value stuff too high to get the house on their books. But in a rising market, the houses would sell when the market caught up with the asking price - so the fact that people are reducing the asking prices should signify something.

Friday, July 3, 2015 01:03PM Report Comment

5. nickb said...

Is the nationwide index based on asking prices? I thought not.

Friday, July 3, 2015 02:40PM Report Comment

6. cornishman said...

nickb, I realise that. I was puzzled by the conflicting statements of sale prices coming down (according to Nationwide) and asking prices going up (according to Rightmove). Then I was surprised at just how many had reduced their asking price.

Thinking about it some more, maybe the potential sellers of older houses are setting their asking price off comparables with the prices for new-build houses (which are now priced 25% higher than they were before Help to Buy skewed things). They would then have to reduce their expectations when they get no viewings or offers - because any potential buyer has to fund the whole purchase rather than just 80% of it.

The difference between mortgage size for a new house and a 'comparable' second-hand one is sizeable:

So if price is ultimately set by the amount of credit available, people with secondhand houses should be asking much less than the comparable new-build if they want to sell it.

Friday, July 3, 2015 05:10PM Report Comment

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