House price rises to continue next year, says Rightmove

Asking prices have dipped slightly in the normal November slowdown, Rightmove reports this morning.

But it is the smallest drop for four years and indicative of “even higher prices next year”, Rightmove said.

Separately, Knight Frank is forecasting 4.1% house price inflation next year, predicting rises in every region, and cumulative growth in prices to the end of 2020 of 20.3%.

According to Rightmove, the average asking price of a property new to the market is now £292,572, down 1.3% from October but up 6.2% on a year ago.

Rightmove director Miles Shipside said: “New-to-the-market sellers have dropped their asking prices at this time of year for the last eight years, with an average drop of 1.9% over the last five years.

“Those looking to market their property as Christmas gets closer often have a greater sense of urgency to find a buyer and sensibly recognise that trimming their asking price will provide an incentive to potential buyers more focused on seasonal Christmas trimmings.

“Buoyant market conditions and a confident outlook for 2016 mean that the reduction, while no doubt welcome to hard-pressed buyers, is the most Scrooge-like since 2011!

“It’s likely to be a short-lived respite as the combination of high confidence and low interest rates is a recipe for higher prices next year.”

Rightmove cited research done over the summer, showing high home-owner confidence.

The research, with a sample size of over 23,000, revealed that the majority (85%) do not think their financial situation will worsen in the next year.

Despite the possibility of a 2016 rate rise that could increase mortgage repayments for many, 41% of home owners said they thought their household’s financial situation would get better over the next 12 months.

Another 44% said things would stay the same, with only 15% forecasting they would get worse.

The majority (69%) were also of the opinion that property would continue to rise in price over the next 12 months, with only 7% expecting prices to be lower.

Rightmove says the average stock per agent is now 62. However, that figure includes properties under offer or sold subject to contract, meaning that actual available inventory for sale per agent is likely to be far lower.

Rightmove has not offered this explanation previously: for example, in its October survey simply giving the data under the title “Average properties for sale per agent”.

In Knight Frank’s new forecast, the firm says continued lack of stock for sale next year will “continue to put a floor under pricing”.


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  1. Robert May

    More reckonings, here is one from 2012

    “Tough times for estate agents until 2017, prediction 07 December 2012 The good news is that the worst is over. The bad news is that there won’t be a true recovery for another five years – and even then, it depends on what your definition of ‘recovery’ is”

    London/SE looks to be over inflated by about 20% I can’t see that continuing if there is an interest rate rise. Elsewhere the market is under-inflated by  up to 25%

    It is very brave to predict anything in a world as uncertain as ours.

    1. mrharvey

      Agreed, Robert. my daily trawl through the property industry news unveils a lot of contradictory statements. Example, buy-to-let is apparently dying, and landlords are escaping as quickly as possible. Meanwhile, buy-to-let lending is the highest it’s ever been, mainly due to remortgaging!

      It’s safer not to extrapolate too much from any given data set. Furthermore, the only forecasts and predictions we can make are so obvious (“rents are going to rise”) that they’re not even worth saying out loud!


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