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House prices fall for third month in a row

House prices fall for third month in a row

Category: Mortgages

Updated: 21/09/2010
First Published: 21/09/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Property asking prices took a dive for the third month in a row during September, statistics show.

New sellers dropped asking prices by 1.1% this month, following on from the 1.7% drop in August and the 0.6% drop in July, figures from Rightmove show.

The average asking price now stands at £229,767, a fall of £2,427 from August's £232,241.

The continuing downward trend means that the gains of 7% made in the first half of 2010 have now been eroded by almost half.

The reasons for the dip can be attributed to a housing market saturated with sellers and the tight lending conditions which are making it difficult to attain a mortgage.

However, in September only 26,000 new properties entered the market per week, the lowest since April. This is also down 11% on the 29,220 recorded in August.

This could be a sign that the oversupply seen in the housing market is starting to ease.

A possible reason for this, according to Rightmove's director Miles Shipside, is that the surge of extra stock following the abolition of Home Information Packs (HIPS) is starting to balance out.

September's figures add support to those who believe a double-dip in the housing market is on its way and to those who see the dip as a short-term autumn blip, added Mr Shipside.

"The 'double-dippers' will be able to point to a clear downward trend, with new sellers dropping their asking prices for three months on the bounce. They can cite tough competition amongst sellers and agents struggling to find proceedable buyers for their record levels of unsold stock.

"Conversely, we are also recording the lowest weekly run-rate of fresh sellers since April. This will give some ammunition to those forecasting a flatter price trajectory as it could be an early sign of fresh supply beginning to wane."

Properties in the East Midlands saw the biggest fall in asking prices (-4.4%), with the North recording the second biggest drop of 2.4% and Greater London in third with a 1.5% drop.

If a fall in prices is enough to tempt you to the housing market, then check out the Best Buy mortgage tables.

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