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October 18, 2010
Rightmove Says Average Asking Price Increasing Throughout UK
Rightmove’s monthly survey of asking prices shows that homeowners are asking around 3% more for their homes than last month. They point out that this is a common trend and that sellers have increased asking prices every Autumn for the past decade.
There are, as always, some differences with regards to London house prices and UK wide prices. The UK is experiencing a sales glut, as houses continue to come on to the market and not be sold. London is experiencing the opposite trend. Agents are clamoring to find properties, both to sell and to rent, and not finding the traditional post holiday increase to be quite as high. Prices are continuing to rise, led by Prime Luxury Properties whose prices are expected to increase.
That being said, there are some things to note in any price survey. First, month on month pricing isn’t the most accurate way of tracking prices. Marketing and transactions can take as long or longer than a month to complete. As well, certain months have certain trends in housing, as Rightmove pointed out. As Summer and Autumn start, prices increase despite the overall trend. Comparing prices to the same time last year is much more accurate in understanding market trends.
Second, the survey is of asking prices, not selling prices. Sellers may be testing the waters with high asking prices, with every intention of reducing the price later on. As well, transaction levels have decreased significantly over the past year. Agents are much more interested in every individual sale because they are less likely to have many come around. Agents being human, they will encourage the price to go up. They may tweak comparable data to say that the price is higher or may simply argue that a property is more impressive than it actually is. This may be unintentional, or more malicious depending on the agent and how many deals he’s done of late.
Overall, these figures say that people are more optimistic, more desperate or some combination of both.