U.K. Home Asking Prices Drop at Sharpest Pace Since Lockdown

(Bloomberg) -- Sign up for the New Economy Daily newsletter, follow us @economics and subscribe to our podcast.

The price of U.K. homes coming to market fell at the sharpest pace since the height of the national coronavirus lockdown in January, a survey by Rightmove showed.

The property website said the 0.6% decline in November followed a 1.8% surge the month before and brought the average asking price to 342,401 pounds ($458,000).

Rightmove attributed the drop to a “pre-Christmas lull” following the end of a tax break on property purchases on Sept. 30. It noted that December is usually the slowest month of the year for the market, and that the dip is likely to prove short-lived.

“Sellers who come to market this close to the distraction of Christmas often have a pressing reason to sell,” said Tim Bannister, Rightmove’s director of property data. “More people are trying to get a head start on making 2022 their year to move.”

The number of people beginning the selling process by asking for a valuation from an agent rose 14% from a year ago on the Rightmove site. 

A separate report from mortgage lender Halifax showed property transaction surged to 265,070 in the first half of 2021, more than double the number a year earlier. The total in the 12 months through June was the highest since 2007, just before the global financial crisis hit.

“There are many factors that have driven this activity, perhaps the biggest of which is the ‘race for space,’” where people for whom home working is the norm seek bigger properties with room for an office, said Andrew Asaam, mortgages director at Halifax. “The timing of these moves also have been influenced by people wanting to benefit from the stamp-duty holiday.”

Rightmove said asking prices in Wales led the declines, dropping 2.4% in the month. Aside from the east of England, the only region where prices rose, London was the least-badly hit with a 0.4% fall.

©2021 Bloomberg L.P.