Rightmove: Ratio of properties to buyers doubles over past year

Jun.23, 2008 in Market Outlook

LONDON (MarketWatch) - British home sellers dropped their asking price by 1.2% in June as tight credit conditions made it increasingly difficult for buyers to find mortgages, U.K. property website Rightmove said Monday.

Reduced asking prices were virtually inevitable given a rising property-to-buyer ratio of 15 to 1, Rightmove said, in a news release. The ratio stood at 7 to 1 a year ago. Meanwhile, new sellers had continued to ask record prices for homes.
“It was a mad state of affairs that defied the laws of economics. Thankfully, new sellers are now taking some proactive steps to price more realistically from the outset to attract increasingly hard-pressed buyers,” said Rightmove commercial director Miles Shipside.
The monthly decline in June leaves asking prices 0.1% higher than in the same month last year. Home prices had risen by 1.2% in May, for a year-on-year increase of 2.2%. June’s decline saw the average asking price fall to 239,564 pounds ($472,224) from 242,500 pounds ($478,011) in May.
Shipside said further cuts in asking prices will be required for properties in over-supply.
Buyers continue to struggle with affordability buyer affordability as the average cost of living outstrips wage increases and mortgage rates continue to move higher, he said.

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