Credit crunch does not stop asking prices from rising
October 15, 2008
According to recent reports asking prices on some properties are still increasing despite the fact that property values have been falling for almost a year. Figures have revealed that the mortgage famine and falling property values have not stopped asking prices from rising in the London area, as hopeful sellers try and get as much for their homes as possible with many reluctant to accept the fact that property values are falling. This practice is adding to the housing downturn, with buyers unable and unwilling to pay the high prices that sellers are demanding.
Figures showed that whilst property values were falling asking prices in London had increased by around 4 percent for the months, equating to an average rise in asking price of around £15,000. Kensington and Chelsea saw the largest rise in asking prices on properties. The research was carried out by Right Move, and the results showed that homeowners in London also expected their properties to sell much faster. Around 40 percent of buyers in London said that the expected to view no more than six to ten properties before finding the right home.
One official from Right Move stated: ‘The current financial situation has led to a readjustment which will make property prices more affordable, though admittedly still beyond the reach of many. Our research shows that those who are looking to purchase a property want to do so quickly but are struggling to find properties in their budget.’
It was also shown that the recent increase for stamp duty exemption from £125,000 to £175,000 had failed to have a real impact in London, as the average asking price in the area is far higher than the maximum exemption threshold. Two out of every three buyers said that the changes to stamp duty regulations had made no difference to them.
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