By Angela Monaghan
A new north-south property divide is emerging in the UK ahead of the festive season, with people selling second-stepper homes in the north of England standing the best chance of finding a buyer by Christmas, according to Rightmove.
Those selling more expensive “top of the ladder” properties in London and the south of England have the least chance, the property website said in its latest house prices report.
Asking prices for homes coming to the market in England and Wales rose 1.1% to £313,435 in the four weeks to 7 October, following a 1.2% drop the previous month. Prices rose in eight out of 10 regions, the exceptions being Yorkshire and Humber and east Midlands.
Rightmove said, however, that there were more sellers chasing fewer buyers as cash-strapped consumers become more cautious about major spending commitments. The number of properties coming to market in England and Wales was up 3.1% last month compared with the same period in 2016, but the number of sales agreed was down 5.9%.
Properties in the south of the country proved more difficult to sell, with sales agreed down 7.9% compared with 3% in the north.
Miles Shipside, Rightmove’s director and housing market analyst, said that with the average time to find a buyer being 63 days, many of the 104,000 new sellers over the last month may find it tricky to agree a sale before Christmas in 69 days’ time.
“It will be harder for this autumn’s sellers to secure a sale because buyers have more choice. New sellers’ pricing optimism may therefore be unfounded in some parts of the country.
“With buyers becoming more Scrooge-like with their cash, sellers who have undercut the average 1.1% rise in asking prices may stand a better chance of finding a buyer before Christmas, especially if they are in one of the more active parts of the market.”
Sellers of homes targeted at second-steppers – people moving up from the first rung on the ladder – will have the easiest time in finding a buyer before Christmas. According to Rightmove, sellers of three or four-bedroom homes – excluding four-bedroom detached properties – take an average of 60 days to find a buyer.
Typical first-time buyer properties, with one or two bedrooms, take an average of 62 days to sell.
“Whist affordability is stretched, it is still countered by the motivation to own a home rather than rent, or the need for extra space to house a growing family.
“However, with buyers’ average wage rises often falling behind retail price inflation, and with a rise in interest rates being more heavily trailed by the Bank of England, sellers in these most popular sectors should still be wary of over-pricing,” Shipside said.
The toughest part of the market is the top, where it is taking on average 76 days to find a buyer for a five-bedroom home or a four-bedroom detached property.
“The extra challenge to sell these larger properties is especially noticeable in London, where the average time to find a buyer is now 86 days,” Shipside said.
Brian Murphy, the head of lending for the Mortgage Advice Bureau, said it remained to be seen whether buyers would put moving plans on hold if the Bank of England raises interest rates in November for the first time in a decade, as many now expect. Rates are currently at an all-time low of 0.25%.
“That said … in reality for those seeking a mortgage to purchase their next home, there will still be good fixed rate deals to be had, providing long term security on many households largest element of monthly expenditure,” he said.
Source: The Guardian