Prices dip for first time in 2014
But despite prices declining by 0.8% (-£2,116) in June Rightmove has upgraded its forecast for 2014 and predicts that new seller asking prices will see an 8% annual increase by year end.
Miles Shipside, Rightmove director and housing market analyst, said: “A price fall in July is not unexpected as prospective buyers turn their attention to the summer holidays, not to mention the added distraction of an engaging World Cup.
“Buyer confidence may also have taken a knock with suggestions that mortgages are becoming harder to get and repayments may get more costly sooner than originally anticipated should the rumours of an interest rate rise before the next election come true.“
The index also reveals a ripple effect on process emanating from London which saw a 15% increase in the number of properties coming onto market in June.
While the national average shows the number of properties coming to market is up by 9.4% this year compared to a year ago, supply remains more constrained in the high-demand commuter and second-home hotspot areas of East Anglia (+5.0%), the South East (+5.8%) and the South West (+5.9%).
And Jeremy Duncombe, director, Legal & General Mortgage Club, said more must be done to increase supply levels and build the quarter of a million homes needed every year.
He said: “These figures show that the regional divide in the UK is still very strong. London and the South East have witnessed a high rate of growth over the last few months, while other areas of the UK are recovering at a much slower pace.
“A minimum of 250,000 houses needs to be built every year, particularly in areas such as London and the South East where demand is far stronger than supply and the job markets are strongest.