Rightmove records second month of price falls

House prices have slipped back in the last month by just over half a per cent, to end the year 6.6% up on 2019, according to the latest figures from Rightmove.

The fall of 0.6% is the second monthly drop in prices recorded by the online property portal, following a 0.5% fall in November, taking the average asking price of a property to £319,945.

The drop, which the firm said came despite continued strong demand, means the 6.6% annual rise for 2020 is lower than the 7% Rightmove was predicting as recently as October. Rightmove did not say what it thought was behind the 0.6% month-on-month fall.

However, the rise over the year compares with widespread forecasts of double digit falls in house prices at the onset of the pandemic. It said demand was over the last month 53% higher than at the same point last year.

The figures came as Rightmove issued forecasts saying it expected growth of 4% in house prices next year, despite the possible impact of the withdrawal in March of the current stamp duty holiday. The firm said that while “headwinds and uncertainties remain, demand for housing and buyer affordability appear to be strong enough to outweigh some of these dampening effects.”

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Last month the Office of Budget Responsibility said it expected house prices to fall by 8% next year as the stamp duty holiday was withdrawn and the furlough scheme ended.

Tim Bannister, director of property data at Rightmove, said: “We are confident that the housing market will continue to outperform general expectations next year as it did this.

“Our 2021 forecast of a 4% price rise is more conservative than the unsustainable 6.6% national average seen this year. There’s likely to be a lull in quarter two unless the stamp duty holiday is extended, but for many buyers its removal will not be make or break, though may lead them to reduce their offers.”