Housing market hit by ‘December price slump’

The slowdown in the UK property market has continued into December, with new research suggesting that asking prices have dipped by £9,000 this month.

The latest data from property site Rightmove shows that asking prices were typically 3.3% lower earlier in December, hitting an average of £258,424.

Prices have been held back in recent weeks by lower levels of demand and tighter mortgage lending measures.

Analysts upbeat over 2015 prospects

Despite this month’s reading, the website’s House Price Index forecasts that 2015 should benefit from price inflation of between 4% and 5%.

Low interest rates, stamp duty reforms and property shortages are all expected to combine to push prices higher.

Over the course of this year, it is believed that asking prices have jumped by 7% in national terms.

2014 ‘still a positive year’

Miles Shipside, director of Rightmove, suggested that despite December’s findings, this year has been a positive one for the housing market.

He said: “The overall picture for the year is still one of a much recovered property market, with sellers and their estate agents confident enough to be putting property on the market at a higher price on average than a year ago, although we predict a slower pace of price growth in 2015.”

South East ‘set to lead the way’

Looking ahead to the New Year, the site said the South East of England is likely to see the largest improvement in asking prices.

This region is likely to benefit from a ripple effect, with buyers in London deciding to look outside the capital for homes.

The East and the South West should also perform more strongly than the North of England, the study’s authors said.

Stamp duty reforms

As part of his Autumn Statement announcement, Chancellor George Osborne recently launched a shake-up of the stamp duty system.

Stamp duty will now apply to house purchases in a similar way to income tax, as a result of the move.

In light of the Chancellor’s actions, some property market analysts have indicated that the coming few months could see a small-scale housing boom in the UK.

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Copyright Press Association 2014