House Sellers Forced To Drop Asking Prices

According to telegraph, experts have forecasted that sellers will continue to drop their asking prices next year with the national average falling up to 5 percent. The current property market will continue to benefit landlords as people choose to rent rather than buy as well as buyers looking to trade up who already have a large deposit.

Those who are being forced to sell will suffer most along with first-time buyers with poor equity and those with low deposits.

The House Price Index released by Rightmove is compiled from the asking prices of properties coming onto the market and represents around 90 per cent of the properties for sale in the UK. It found that sellers in December cut asking prices by 3 per cent (£6,969).

Falling house prices have been blamed on a "mortgage drought" as potential buyers find it difficult to secure an affordable mortgage from banks. If they are successful in doing so, the increase in interest rates has been adding to peoples worry for a long time now. Running an ordinary household seems an unachievable task with inflation running high.

It is seen that the recent price decrease comes despite calls for banks to start lending again. Gross mortgage lending is down three per cent from £14billion in July last year to £13.6 billion in August 2010.

In October prices briefly rallied indicating that sellers were refusing to adjust to new market conditions. It now appears that sellers are becoming more realistic about the prices they can achieve.

Rightmove said "bullish pricin" was a characteristic of the market, but many sellers would be disappointed, as evidence suggested launching a property at a high price often damaged the chances of selling it later at a reduced one.

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