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UK house prices fall for first time in 2022, but experts say this is expected in summer

Average price of property coming to market is £365,173

Originally posted: 22nd August, 2022 Last updated: 1st September, 2022

Average price of properties going up for sale has dropped by almost £5,000

The average price of properties going up for sale has dropped by almost £5,000 but the drop is a regular seasonal occurrence that could see prices bounce back or continue to drop due to the cost-of-living crisis.

The first fall in UK house prices this year; prices fell nearly £5,000 in August, comes as Britons concentrate on summer holidays rather than property.

Newly-released data from Rightmove House Price Index shows a fall of 1.3 per cent (£4,795), which means the average price of property coming to market is £365,173.

This does appear to be good news for prospective property buyers, but this drop is a regular occurrence in August, and the scale of this year’s drop is in line with the average fall for the month over the last 10 years.

Although, Rightmove said that some new sellers were “pricing their properties more competitively” to get a quick sale, something that could give some relief for buyers.

Buyer enquiries up

It appears that buyers are aware of this opportunity, with buyer enquiries to agents up by 20 per cent compared to 2019, although these are 4 per cent below 2021 figures when the market was being boosted by the Stamp Duty Land Tax holiday.

Tim Bannister, Rightmove’s Director of Property Science, said: “A drop in asking prices is to be expected this month, as the market returns towards normal seasonal patterns after a frenzied two years, and many would-be home movers become distracted by the summer holidays.

“Sellers who want or need to move quickly at this time of year tend to price competitively in order to find a suitable buyer fast, with some hoping to complete their move in time to enjoy Christmas in a new home.

“To achieve that this year, they’d need to beat the current average time between accepting an offer and completing the sale of four and-a-half months.

“7 per cent annual growth”

“Nevertheless, we’re still expecting price changes for the rest of the year to continue to follow the usual seasonal pattern, which means we’ll end year at around 7 per cent annual growth, even with the wider economic uncertainty.”

Rightmove said that a mix of rising house prices and interest rates has resulted in average monthly mortgage payments for new first-time buyers with a 10 per cent deposit now exceeding £1,000 – at £1,032.

Despite this though, demand for properties within the typical first-time buyer sector is 32 per cent up on this time in 2019, it said.

‘Asking prices more than doubled’

This latest issue of the Rightmove index marks its twentieth year, during which time national average asking prices have more than doubled, going from £155,994 to £365,173, which Rightmove said had “outstripped both salaries and general inflation”.

Whilst August’s fall in house prices is a regular occurrence, some property experts wonder whether prices will continue to drop this year, or perhaps experience a slower pace of growth.

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