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UK property asking prices fall as Brexit hits confidence

Ben Chapman
The government could offer first-time buyers 20 per cent off their first home, but only if they buy in the place where they grew up: Matt Cardy/Getty Images

Average UK property asking prices have dipped by 0.2 per cent over the past month in a downward trend that began in June.

The average asking price dropped by £730 to £304,770, the first fall at this time of year since 2010, according to Rightmove which looked at data covering 95 per cent of all UK listings.

The property website said the housing market remains “fundamentally sound” but is being hurt by uncertainty surrounding the outcome of Brexit.

Despite these jitters, Brexit has recently been cited as a possible cause of increased housing market activity because some buyers and sellers may be seeking to ensure they move home before the 31 October deadline.

Mortgage approvals rose to a two-year high in July, according to the Bank of England.

However, Rightmove’s figures suggest that any Brexit bump may have ended as the departure date looms larger. The number of sales agreed fell 5.5 per cent this month in all regions compared with the same period a year ago.

A month earlier, Rightmove had reported a “pre-Brexit buying spree” as sales agreed jumped 6.1 per cent, though it cautioned that monthly data can be volatile.

Over the whole year to date – a more stable measure of activity – the number of sales agreed is down by 3.4 per cent against the same period last year.

Miles Shipside, Rightmove director and housing market analyst, said there are signs that buyers who have until now shrugged off uncertainty are now becoming more hesitant.

“The autumn bounce normally kicks off at the same time as kids go back to school, but this year it’s a late starter at best, and if uncertainty persists then the autumn term could be missed altogether and its activities be delayed until the new year.

“Those who are planning to buy or trade up and can keep their nerve whilst others hesitate may find that they are in a stronger negotiating position to get a favourable deal.”

The most up-to-date official housing market data shows that average selling prices, as opposed to the asking prices gathered by Rightmove, increased only 0.9 per cent to £230,000 in the year to June, driven by a particularly marked drop of 2.7 per cent in London.

A number of other UK regions registered strong annual house price growth, the Office for National Statistics (ONS) said last month.

In line with the ONS, Rightmove found a dramatic slowdown in London’s property market, with the number of new homes put up for sale falling 20 per cent over the past year.