October sees drop in house prices

November 24, 2020 by Brendan O'Neill

House Prices

The latest housing market figures published by Rightmove show that October brought a drop of 0.5% in the average price of a home in the UK, following several months of price rises.

In financial terms, this drop adds up to £1,505, with Rightmove indicating that it considers the reason for the fall in prices last month being that those looking to sell their homes were wanting to get them on the market before the threshold for stamp duty returns to normal. This is due to be put back up in March of next year.

However, although the average price fell in comparison to September, it was still significantly higher than in the same month last year. The current average asking price is £322,025, which is 6.3% above that of October 2019 and shows again how pent up demand – plus the lowering of the stamp duty threshold by the government – pushed prices up after the market came out of lockdown.

Speaking to Mortgage Strategy, Tim Bannister from Rightmove said that the month-on-month drop in prices was driven by the desire of people to get their homes sold while it is still possible to avoid stamp duty, adding:

“If your initial asking price is too high then you’re less likely to get an offer even after you’ve cut your price back to a more realistic level.”

This makes it temporarily a market for buyers’, rather than sellers’, and opens up a wider range of possible property options for advisors with a CeMAP qualification and their clients.