Property price growth falls

The housing market is showing signs of stabilising after the average property price last month altered by a mere 0.2 per cent.

12:49 16 July 2004

The housing market is showing signs of stabilising after the average property price last month altered by a mere 0.2 per cent.

According to figures released by the National Association of Estate Agents, annual increases slowed slightly with estate agents reporting house prices on average 10.9 per cent higher than twelve months ago.

However, as prices begin to steady, the market looks like it is beginning to shift in favour of buyers.

Sellers are increasingly finding themselves having to accept less than their asking price, with homebuyers achieving an average discount of 3.5 per cent last month.

This is further indication that the high asking price levels seen so far this year will not be maintained.

The president of the National Association of Estate Agents, Richard Hair, commented: "The market is definitely turning as the natural levelling out we have been expecting starts to take effect."

He continued: "As prices stabilise and buyers exercise more caution, sellers are having to face the prospect of a more balanced market. This will affect prices further and we can expect more changes next month. Although nothing drastic, the market is correcting itself to more sensible levels."

However, the slight levelling in price was not enough for many first time buyers, as their total number fell to its lowest level this year.

Many appear to be exercising caution, avoiding buying at the peak of prices in hope that the steadying of the market will lead to more realistic levels soon.