Estate agency Benham and Reeves says that in the fourth quarter of 2023, the market gap between the average mortgage approved price of a buyer and the asking price expectation of a seller is now 33.4% across the UK
Large gaps remain between Mortgage Approval Prices and Asking Prices – even though there is some evidence of vendors and agents adopting a more realistic approach when it comes to selling.
Estate agency Benham and Reeves, having evaluated a number of property industry and government data, says that in the fourth quarter of 2023, the market gap between the average mortgage approved price of a buyer (£271,172) and the asking price expectation of a seller (£361,811) is now 33.4% across the UK.
In London, the gap between buyer (£515,132) and seller (£675,839) is 31.2%.
In the meantime, the agency also looks at raw house prices.
It says the average UK house price stood at £302,912 during the final quarter of 2023. This marked a -0.6% quarterly drop, and the second successive quarter of negative house price growth in the UK. On an annual basis, the average UK house price also stood -1.4% lower in Q4 2023 versus Q4 2022.
In London, the current average house price in the third quarter of 2023 was £563,459 having also dropped by -0.9% versus the earlier quarter.
Director of Benham and Reeves, Marc von Grundherr, says: A further marginal cooling in house prices during the closing stages of last year was only to be expected given the ongoing headwinds of elevated mortgage rates which continued to dampen market activity on the buyer side of the market.
He said: The good news, it looks as though buyers and sellers are coming to terms with this new normal of higher borrowing costs, with both parties seemingly more willing to meet in the middle in order to progress with their plans to move.
He added: Interestingly, London’s sellers have been less willing to adjust their expectations and while this may have resulted in a decline in overall market activity across the capital, those who do secure a buyer are doing so at a higher percentage of asking price.