House prices in Britain have fallen for the first time this year, according to figures from the online estate agency, Rightmove.
The average asking price for a home in June was £272,275. This dropped to £270,159 in July – a 0.8% reduction.
Houses in Greater London were the most durable in holding their value, suffering just a 0.4% drop. Properties in the North and East Midlands suffered a 1.9% drop in value.
The fall in prices is thought to be the result of tighter regulation on mortgage eligibility. The Bank of England took steps to curb reckless lending amid fears that the London housing market could pose a serious threat to the UK economy.
Banks and building societies have been told that only 15% of their total loans should be at 4.5 times the borrower’s income.
Other factors could include concerns about interest rates which are likely to rise. Miles Shipstone, analyst at Rightmove, said: “A price fall in July is not unexpected as prospective buyers turn their attention to the summer holidays, not the mention the distraction of an engaging World Cup.
“Buyer confidence may also have taken a knock with suggestions that mortgages are becoming harder to get, and repayments may get more costly sooner than originally anticipated, should the rumours of an interest rate rise before the next election come true.”
Please contact us for more information on the legal aspects of buying and selling a home.