Better-than-expected market gives hope for 2023 - Rightmove

The better-than-expected sales market has been a surprise to investors, owners, buyers and sellers alike, says Rightmove.

In its latest monthly snapshot of asking prices it says average price of property coming to the market rose a small £14 in the past four weeks. 

This is the smallest increase from January to February on record, but it says that prices remaining flat rather than falling as some expected could be seen as a positive indicator for the year ahead. 

However, reflecting the slower market conditions new sellers have broken with tradition and held prices static for the first time ever at this time of year rather than increase them. 

Tim Bannister, Rightmove’s property analyst, says: “The big question this month was whether we would see new sellers increasing their asking prices as has been the yearly norm as we approach the spring selling season. This month’s flat average asking price indicates that many sellers are breaking with tradition and showing  unseasonal initial  pricing restraint. In addition to market conditions demanding greater realism on price, we are transitioning into a slower paced market, where buyers will take longer to find the right property at the right price due to the higher cost of servicing a mortgage. 

“There are other indicators that this will be a softer rather than a hard transition despite the turbulence at the end of 2022. Homeowners who are coming to market in the upcoming spring season should use their agent’s expertise and get the price right the first time , which can really help to find the right buyer more quickly.”

Rightmove says the number of sales agreed is now just 11 per cent down on the same period in 2019’s more normal market, picking up from 15 per cent down at the start of the year and vastly improved from 30 per cent down in the aftermath of September’s mini-Budget. 

Meanwhile average mortgage rates have edged downwards after the turbulent months immediately following the mini-budget. The latest data shows that someone looking to take out a five-year fixed mortgage with a 15 per cent deposit would now be looking at an average rate of 4.82 per cent compared with 5.90 per cent in October.

Bannister continues: “The frantic market of recent years was unsustainable in the long term, and our key indicators now point to a market which is transitioning towards a more normal level of activity after the market turbulence at the end of last year. Agents are reporting that they are now increasingly seeing buyers who have more confidence and more choice albeit with revised budgets to accommodate higher mortgage rates. 

“It’s a positive sign for the market to see many in the first-time buyer sector getting on with their moves, though despite average mortgage rates having edged down, some first-time buyers will still be priced out of their original plans and may need to look for a cheaper property, save a bigger deposit, or factor higher monthly mortgage repayments into their budgets.”

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