House sales in October saw a sharp jump due to house sellers realising that they had to significantly lower their asking prices if they wanted to sell their homes and not linger for a long time on the housing market. Even house prices in London were flat whereas the rest of England and Wales saw a drop in house prices with the West Midlands witnessing the biggest drop in house prices. However the West Midlands also witnessed the biggest amount of house sales and homeowners there realised that they needed to drop the asking price of their homes in order to achieve a sale. The number of agreed sales across the country stood at 9.2%.
Estate agents are trying their best to push as many sales through because they know that demand from buyers over the Christmas always dies away. A director of research at property analysts Hometrack, Richard Donnell, said that the big jumps in house sales were due to the homeowners re-pricing their homes rather than an increase in demand from buyers. He said that house prices were currently registering the lowest level of price falls for two years with a 0.4% drop. This was mainly due to the ending of the stamp duty concession for first time buyers which resulted in a rush of sales.
Land Registry figures released in October showed that house sales have been lower in recent months than they were a year ago. Between April and July this year there were 52,300 house sales a month on average. However last year there were 55,000 sales a month during the same period. Even though the Government launched an £80billion scheme at the end of August aimed at increasing mortgage availability to kick start the housing market, lenders have toughened their borrowing criteria at the same time.
Mr Donnell expects house sales to slow down in the run up to the end of 2012 and estate agents will be trying their best to push through as many sales as possible. House buyers were up in the month of October, but by only 0.3%. However there had been four months of falling demand just before this. London saw a jump of 3.9% as the capital can always rely on foreign investors where house sales are concerned. However outside of the capital and around the rest of the country house sales are being thought of as “subdued”.
Some good news for home owners is that the average time a house takes to sell is 10 weeks, but that is only if the home owner is being realistic about their asking price. What you thought your house was worth five years is dramatically different in today’s market but some home owners have difficulty accepting this and therefore it is these homes that tend to linger on the housing market for quite some time.
The Hometrack study regularly asked both estate agents and surveyors what they believed were achievable selling prices. So it looks like homeowners have to accept lower house prices if they ever intend to achieve a sale for their property.
Fiona is a director at The Property Fairy.
She has worked in the land and property sector for the last ten years.
All articles on the website are written uniquely by her.
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