Home sellers use new year surge to push up prices

Click to follow

Sellers have rushed to put their homes on the market at high prices to try to take advantage of the traditional new year surge in activity, a survey showed today.

Asking prices for homes put on the market this month have surged at the fastest pace since last summer, according to the property website Rightmove.

A record 132,000 homeowners have put their properties up for sale so far this month, triple the number in December and some 35,000 more than February last year. The average asking price in estate agents' windows jumped by £4,300, or 2.3 per cent, between January and February.

A Rightmove spokesman said the high asking prices showed that sellers were not desperate to sell. "They are giving it a bit of a punt knowing that they can always accept a lower offer later," he said.

But Rightmove warned it was a sign that sellers and estate agents still believed they could market homes at inflated prices despite mounting signs of a slowdown. Miles Shipside, its commercial director, said: "Some sellers and estate agents are unable to shake off ingrained spring boom mentality of recent years. But this year is not typical and the laws of supply and demand don't suggest that higher prices are sustainable."

Figures from the Land Registry, the Government body, show the number of transactions plunged to a six-year low in the final quarter of last year, falling 24 per cent compared with 2003.

Rightmove said inexperienced estate agents were gambling on a continuation of the market recovery. Mr Shipside said that while the slowdown was "tough" for sellers in a hurry, it was "getting critical" for some estate agents. "We've been seeing a growing number of branches closing down or going out of business, with others forced to cut staff levels," he said.