UK asking price growth slowing, latest data shows
Much has been written about the property market in prime central London cooling but there are now signs that this is spreading to other parts of the country as asking prices begin falling.
Price rises are slowing down in response to rising supply and the average asking price for a flat has actually dipped slightly since July to £161,956, ending a 14 month rally, according to the latest asking price data from Home.co.uk.
Less affected by supply issues are detached, semi and terraced properties and asking prices are continuing to rise for the time being overall but home prices have dropped back during the last month in some regions.
The relatively strong regional markets of the South East, South West, East Anglia and Yorkshire have seen asking prices fall by 0.1%, the first time this has happened this year and is regarded as further evidence of a cooling market.
Greater London posted a more muted month on month asking price rise of 0.3%. Price rises in other English regions, Scotland and Wales since July were all similarly modest at 0.2% or less with the exception of the East Midlands where asking prices increased by 0.5%.
It means that the average annual appreciation for England and Wales fell by 0.3% to 9.3% as the dynamics in the residential property market show signs of changing. The increase in supply was particularly high in Greater London, up 39% compared with a year ago.
‘Record prices in Greater London have tempted many more potential vendors to sell. Supply is up 39% but we must remember that it is rising from an ultra-low level. Some 14,720 properties entered the market last month which is 31% less than the 20,615 properties that were placed on the market in August 2008. Such is the demand in London that supply would need to much more before price stability was seriously threatened,’ said Doug Shephard, Home.co.uk director.
‘If we look at the wider supply dynamics across the rest of the country it is clear that buyer demand is certainly lower than it was before the financial crisis of 2007, but supply remains very low indeed. On the demand side, mortgage lending is working and interest rates remain very favourable for the time being,’ he pointed out.
But he added that on the other hand supply has increased by just 6% over the last 12 months across the UK. Outside of London, the largest rises in supply were found in the West Midlands and in Wales with 9% and 8% growth respectively year on year.
‘Such modest increases, from what is a record low level, are hardly likely to cause a crash any time soon, but they will help tame price rises and that will both help stabilise the market and be welcome news for aspirant buyers,’ said Shephard.
The report also reveals an end to the improving trend observed in the slower markets in terms of marketing times. In August 2013, only four regional markets, London, the South East, East…