Rightmove: asking prices bounce back, but New Year optimism may not last

Average asking prices were up 0.9% in January – or £3,301 – to £362,438. They’re still down £8,720 from October’s peak. On January 5, the number of buyers sending requests to property agents on the site was the third highest Rightmove has ever seen.

Sarah Coles, senior personal finance analyst, Hargreaves Lansdown said: “Average asking prices rebounded in January, as the new year ushered in a wave of optimism in the property market. Buyers were back too, surging in the first week of the year to produce one of the busiest days that Rightmove has ever seen. But there are no guarantees that this will translate into higher selling prices or more sales.

“After two months of falling asking prices, it’s tempting to see this as a change of market dynamics, but that’s likely to be unrealistically optimistic. January always tends to see a bounce in the market, as people decide to make change in the new year, so this may just be a blip.

“Higher asking prices feel like a positive indication, but it’s not a concrete change. It’s worth bearing in mind that Zoopla figures at the end of December showed that sellers were accepting an average discount of 4% on their asking price, so this could just be a flurry of optimism that ends in disappointment and price cuts.

“The return of more buyers is worth keeping an eye on. It may be that some of those who fled the market when mortgage rates went through the roof have been persuaded to come back as those rates have come down from the peak. The return of buyers could mean house price falls aren’t quite as bad as had been predicted. However, equally, this could be a brief moment of New Year optimism, which vanishes on contact with reality and dissipates before  any sales materialise.”