Eurozone uncertainty hits sellers and prices

Nia Williams

November 21, 2011

This represents a drop of 3.1% – or £7,528 – although average asking prices were still up by 1.2% year on year.

Rightmove said this is the largest monetary fall since December 2007 and the third largest percentage fall on record.

The number of new sellers fell by 13% over the month as 70% of home movers said it was “a bad time to sell”.

This month’s statistics from Rightmove highlight how the relentless stream of economic uncertainty around the eurozone crisis has eroded consumer confidence to the extent that it now dominates decisions when it comes to moving home.

Miles Shipside, director of Rightmove, commented: “Markets dislike uncertainty, and so do people who are deciding whether or not to enter the property market.

“Agents report that many would-be sellers are postponing their marketing until the new year, influenced by the current wall-to-wall media coverage of the Greeks and Italians attempting to get their own far-flung houses in order.

“It’s no great surprise that those who have braved the stormy conditions have had to accept a substantial ‘haircut’ on their asking prices.”

The lack of fresh sellers and the large price fall indicate that the current negative economic outlook has caused the seasonal slowdown to come early this year. This lead indicator of consumer inactivity from the housing market will raise concerns in other sectors of the economy that are reliant on consumer spending.

All regions are showing monthly price falls in Rightmove’s Index, the first time this has happened for over three years. However, with lower levels of new listings, especially in higher price brackets, there is some volatility at a regional level.

Shipside observed: “While most home movers will have seen some foreign prime ministers losing their jobs, they will be much more keenly aware of the unsettled outlook for their own employment locally.

“When you are busy looking over your shoulder, you are unlikely to think it is a good market for selling. However, that does mean there are opportunities for those who are able to buy, especially as the earlier than usual seasonal slowdown will leave sellers who have to sell in an even weaker negotiating position.

“Those who are looking to trade up should not lose heart however, as while you may have to accept a lower price for your own property, you should be able to negotiate a good deal on whatever you are buying.”

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