Largest increase at this time of the year since 2020
After two months of falls in house prices, average new seller asking prices have risen by 0.9% (+£3,301) in January – the largest increase at this time of the year since 2020, as New Year sellers test the market, reports Rightmove in its latest House Price Index report.
This larger than usual New Year bounce in prices comes after an extended year-end lull, with average asking prices still £8,720 lower than their peak in October.
Rightmove reports that there are some signs of positivity in the first few weeks of the year. The number of prospective buyers getting in touch with agents is up 4% compared to the same time in 2019, and up by 55% compared against the two weeks prior to Christmas, which is the largest New Year bounce since 2016.
We have certainly seen this at Preston Baker Estate Agents across all areas, including Leeds, Doncaster, Selby and York, with a busier than expected start to the year for valuations booked and homes listed and sold.
Third busiest day ever
January 5th is reported by Rightmove as the third busiest day ever for people asking agents to visit them and value their home, which is an early indicator of confidence for the year to come.
SJ Taylor, Preston Baker Director, commented: “Many people strapped themselves in for a turbulent winter given the media frenzy around the cost-of-living crisis, rising mortgage rates and the threat of a recession looming. However, what we have seen since coming back from the festive break, our clients have clearly taken time to really think about the reasons for moving and how motivated they are to make that happen in 2023! We have had some wonderful conversations so far with some lovely returning clients as well as building some great new working partnerships with clients that are using Preston Baker for the first time.”
Mortgage interest rates soften – deals now available below 5%
Also, average monthly mortgage payments for struggling first-time buyers continue to drop as mortgage interest rates soften, with some deals now available below 5%. Further easing of mortgage interest rates this year may tempt more first-time buyers to send enquiries to estate agents and begin the process of a 2023 move, says Rightmove.
James Kear, Preston Baker’s Head of Financial Services, says that while 2022 was a challenging time with rates changing almost daily, all signs now show the market is stabilising and “mortgage brokers are proving to be worth their weight in gold helping home buyers secure the best mortgage rates.”
James added: “We are now starting to see people save money again and see people who were put off from buying come back to the market; Preston Baker brokers are on hand to help these home buyers secure their dream home for the right price with the right mortgage for them.”
The Rightmove report states: “After two months of falls, the average price of property coming to the market for sale rises again by 0.9% this month (+£3,301) to £362,438. Whilst a rise in asking prices is expected in January, this is the highest at this time of year since January 2020. After the market’s uncertain final few months of 2022, this familiar seasonality is a tentative sign of stability, with new sellers feeling confident to test the market, albeit at average asking prices that are 2% below October 2022’s record. It’s still early days, but this is a more encouraging start to the year than many anticipated.”
“Calmer, more measured market”
Tim Bannister, Rightmove’s Director of Property Science, commented: “The seasonal increase in new seller asking prices this January from December is particularly encouraging for movers who are looking for the reassurance of familiar trends and a calmer, more measured market after the rapidly changing and at times chaotic economic climate of the final few months of last year. However, while average asking prices did rise in January, they are still £8,720 less than their peak in October. The early-bird sellers who are already on the market and have priced correctly are likely to reap the benefits of the bounce in buyer activity, while over-valuing sellers may get caught out as property stock builds over the next few weeks and months, and they experience more competition from other better-priced sellers in their area. It will be important for the vast majority of sellers to remember that a drop in your asking price is likely not an actual loss compared with what you paid for it, only a failure to live up to aspirations. Listening to your estate agent’s advice about your hyper-local market and pricing right the first time can avoid a stale sale and the need for even greater reductions later.”
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