Yahoo Finance Asking prices for homes continue to climb while sales prices slow
The average asking price of homes in the UK has hit a record high, while separate indices show a slowdown in the sustained growth of property values, suggesting buyers may be demanding bigger discounts.
Rightmove said the average asking price jumped 1.2pc in May, rising for the fifth month in a row and bringing the median price to a record of £317,281.
But the annual increase was 3.2pc, which Lucian Cook, head of residential research at Savills, described as "muted".
He added: "It does fly in the face of some slowdowns reported in other indices and indeed the poll by the Royal Institution of Chartered Surveyors, which is a robust indicator of what is going on in the market."
It comes after Halifax's house sales price index showed earlier this month that the housing market was stagnating, as the quarterly rate of growth fell for the first time in more than four years.
House prices were 0.2pc lower in the three months to April than in the preceding three months, the first quarterly decline since November 2012. Nationwide's index also suggested a slowing rate of growth, with prices growing at the slowest rate in four years.
But this mismatch between asking and sales prices could reflect an increasing number of buyers asking for discounts on properties.
Rightmove said that in 2016 the average sold price was 3pc lower than the asking price. In the first three months of this year, it was largely unchanged at 3.1pc lower.
Miles Shipside, director of Rightmove, said: "Prices are at a record high and there's a limit to what people can afford.
In charts: transactions are falling fast, so what will happen to house prices?
"We are in the busiest time of year now, and sellers' asking prices reflect that. We expect them to slow in the second half. I think you will also see Halifax and Nationwide's indices will show a rise in the next couple of months when the spring activity feeds through."
The lenders' indices show sales prices only when the mortgages have gone through, so there can be a lag.
Mr Cook added: "If you look at annual numbers [in this index] it can be a useful lead indicator of what is happening. No index is perfect, and we know the Office for National Statistics' official one has its faults. You need to look at them together."
Nick Leeming, Jackson-Stops & Staff’s Chairman, comments: “Any uncertainty generated by the snap-general election has failed to deter most buyers and sellers from entering the housing market."
