Experts and commentators attempting to read house-price runes since the vote for Brexit have been quick to point to reports of modest valuation deflation in July.
However, they could be ignoring the all-important seasonal variability of the market as according online estate agent Rightmove reports property values are behaving exactly as they would be expected to at this time of year.
The Times reports the site has tracked a 1.2 per cent drop in prices for last month, roughly in line with the fall of around one per cent indicated in reports published by Halifax and national estate agent group Haart.
This was an almost-identical fall to that seen in July in each of the last six years as the market enters its usual summer season lull, according to Rightmove.
“Many prospective buyers take a summer break from home-hunting, and those who come to market at this quieter time of year tend to price more aggressively,” Miles Shipside, the company’ housing market analyst, said.
“Most sellers seem to recognise that buyers may want some extra encouragement to get them to put their towel on a property to reserve it as well as on their sunbed.”
Unlike the Halifax and Haart data sets, which are based on exchanged or completed sales that typically lag offers by anything up to 12 weeks, Rightmove’s figures are based on asking prices for newly listed properties.
While this provides a better indicator of post-referendum sentiment, it only shows how vendors are pricing and says little about the mood of buyers.
One potential indicator of demand is encouraging, says the Daily Telegraph. Buyer enquiries were down on last July, when there was a pre-election surge, but also up on the usual seasonal trend, Rightmove reported.
“By autumn, we should get a clearer view of the strength of any post-referendum hangover, though that also depends on buyers’ confidence to turn this interest into action,” Shipside said.
Last week’s interest rate cut from the Bank of England, to a new record low of 0.25 per cent, should make “already cheap-to-borrow money even cheaper [and] act as an added boost to confidence”, he added.
