The UK's biggest property portal predicts a fall in house prices next year.
Rightmove has forecast that average new seller asking prices will be one per cent lower nationally by the end of 2024.
It added that sellers will need to ‘price more competitively to secure a buyer in 2024’, and first-time buyer affordability ‘will remain stretched’.
A year ago, the property portal predicted average new seller asking prices would drop by two per cent in 2023, and they are currently 1.3 per cent lower year-on-year.
Longer to sell
The average time for a seller to find a buyer has risen from 45 days this time last year to 66 days now, said Rightmove.
It expects that sellers with a more pressing need to attract a buyer will continue to price below their competition into 2024, and that they’ll be joined by those who have taken longer to accept the current softer market conditions.
The level of price reductions increased during 2023, with 39 per cent of properties now seeing a price reduction during marketing compared to 29 per cent last year, and 34 per cent in 2019.
Mortgage rates will settle
While it expects mortgage rates to settle, Rightmove isn’t predicting any significant cuts next year.
The average two year fixed rate is now 5.52 per cent and average five year rate is 5.11 per cent, and mortgage rates have now fallen steadily since July.
Rates may have peaked and next year is likely to see less volatility in pricing but affordability remains stretched for many borrowers.
This means that some buyers’ spending power will remain limited next year.
Rightmove’s property expert Tim Bannister said: “This year has been better than many predicted, with no significant signs of forced sellers, lower than expected price falls, and good buyer demand for the right-priced quality properties.
“However, it has been a challenging change in mindset for some sellers to transition from the frenzied market of the previous few years.
“An average drop of one per cent in prices reflects our prediction that it’s likely to be another muted, and in parts challenging, year for some buyers and sellers in 2024.”