UK house prices grew at their slowest four years in February, new data from Rightmove has shown – as it warned agents against setting properties' prices too high.
Asking prices rose just 2.3 per cent in the year to February, according to the figures – down from 3.2 per cent in the year to January, and the slowest growth since April 2013.
The average house price rose to £306,231, the second time it has risen above £300,000. For first-time buyers, average prices climbed 4.6 per cent to £192,097 in the year to February.
Although the report’s authors stressed that demand remained strong, with traffic on the Rightmove website up three per cent since January 2016, they also warned agents to price properties carefully.
Miles Shipside, Rightmove director and housing market analyst said: “While the prices of goods in shops are rising at a faster rate, the pace of price rises in property coming to the market is slowing”.
“They’re still 2.3 per cent higher than a year ago, but perhaps we’re approaching the territory where many buyers are unable or unwilling to pay what sellers are asking, given the negative combination of rises in the cost of living, tighter lending criteria, and a dose of Brexit uncertainty”.
A slower rate of price increases can raise the risk associated with overpricing properties, according to Rightmove. Sellers are 40 per cent more likely to sell their property if it is priced correctly, with agents surveyed in the Rightmove report suggesting buyers were unlikely to take make any initially inquiries into a property that looks overpriced.
The first part of last year saw “frenzied” activity as buyers snapped up buy-to-let opportunities prior to the April stamp duty deadline.
James Sims, Director at Brik Estate Agents in Fulham said: “The sales market in Fulham is currently very price sensitive. We’re noticing that reducing properties by even a marginal 2-3 per cent can make a significant difference to the level of interest from potential buyers.
“As is usual at this time of year we’ve had more sellers of properties in higher priced brackets come to market, and so we’ve been working with them to make sure their property is marketed at the right price.”