Summer is well underway in August as a lot of people are enjoying their summer holidays at their favourite destinations without being hindered by travel restrictions imposed by the pandemic a couple of years ago.
How does that relate to the price of houses? People who are planning to move usually like to do it after they enjoy their summer holidays. So right now, there are not as many people moving, and there are not as many properties on the market. Historically, a slow market leads to a seasonal drop in house prices, and the dip in prices this August, the first time this year, is consistent with the summer trend in previous years.
In Great Britain, the current average asking price of a home is £365,173. This is a decrease of £5,000 or 1.3%. This is consistent with the average decrease in August for the past 10 years.
Tim Bannister, our expert in real estate, says the August price decrease is expected because it follows normal summer seasonal patterns after two years of high real estate activity.
Many real estate agents, including Jordan Yorath of Monroe Estate Agents in Leeds, are recommending to their clients to wait until September before they proceed with their moving plans.
He says that because so many people are now travelling after putting off their holiday travel plans for the past two years, it is best to wait until after August before putting their properties on the market. He says that his office has been very busy planning for the rest of the year, with many property listings prepared for launch in September and onward.
Wimbledon Village estate agents are providing professional services or personal services, ongoing guidance, to go the extra mile for selling your home. You can go with them and discuss your thoughts.
A Moving Date by Christmas
Summer is not the only season that affects home prices. There is another seasonal event that is influencing how home sellers are pricing their properties.
Right now, the completion of a property sale takes an average of 136 days or 4.5 months. This takes us right up to the Christmas season.
Home sellers who want to celebrate Christmas in their new home will need to find the right buyer quickly. To attract buyers, homes need to be priced competitively. We are seeing some of that this summer.
How does a rise in interest rates affect house prices?
Interest rates recently rose for the sixth time to 1.75%, which is an increase of one-half of a percent. People who are looking to buy are very aware of these increases.
Currently, this increase does not seem to have affected people’s desire to move. However, this increase might start to affect real estate activity for the remainder of the year.
At the moment, the main factor that will impact asking prices, apart from seasonal patterns, is the relationship between the demand from buyers and the number of properties on the market.
Will the drop in house prices continue for the rest of the year?
Although the demand from buyers has slowed down after an extraordinarily busy year in 2021, there is still enough demand to keep the prices at around their current levels.
The months in autumn are historically a busy time in terms of real estate activity. People planning to move to want to do this before the year ends. This demand can drive up home prices. As December arrives, prices will cool again as people become more focused on preparing for Christmas festivities rather than moving their homes.