Average House Prices Falling For First Time In 2021 But Will The Property Market Crash?
Average House Prices Falling For First Time In 2021 But Will Property Crash?
House prices have fallen for the first time this year, according to property website Rightmove, but does this mean we are heading for a market crash?
The website reports that the “average price of property coming to market in August fell 0.3%”, which is a small drop of £1,076, to £337,371.
The property market slowdown follows the ending of the stamp duty holiday and a subsequent fall in demand for bigger homes.
“Average prices have only fallen in the upper-end sector,” said Tim Bannister, Rightmove’s director of property data.
First-time buyers and second-stepper properties are still in demand, leading to new record high average prices in those sectors, he added.
Rightmove figures revealed a 0.8% drop in the four-bedroom-plus sector, but new record price highs in the two-bedroom sector, up by 0.6%, and three to four bedroom second-stepper-type properties, up by 0.3%.
Summer holidays normally lead to a slowdown in activity in August, experts pointed out, with many anticipating a slackening in demand. Source: BBC and Rightmove.
The small property price falls, based on new houses coming onto the market, do not yet indicate a market crash. Minor price fluctuations could be seasonal or influenced by a post-stamp duty holiday slowdown.
Property investors should see a return to a more normal buyers property market in the coming months. I am definitely noticing more price reductions and properties coming back on the market after a sale fell through.
However, markets, like the bond and stock markets, are not always rational and frequently react to external events, such as a war or political instability in the Middle East.
The actual figures based on sold properties for the current period will be revealed in official Land Registry data later this year.
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