Estate agents said they have seen recent home sales dented as mortgage volatility bites, and new research shows sellers are accepting lower prices.
The comments about the impact of higher borrowing costs as lenders pass on the Bank’s interest rate rises came as financial information company Moneyfacts published fresh data.
It said an average two-year fixed residential mortgage is now 6.30%, up from 6.26% a day earlier, while the average five-year fix has risen to 5.91%.
Edward Kay, a director at Mill Hill-based Squires Estates, said agreed sales in June are down about 50% from May.
He added: “Anyone who has managed to secure a mortgage at a lower rate remains keen to complete their purchase as soon as possible whilst their deal remains in place.”
North London agent Jeremy Leaf said at his eponymous chain exchanges are still going ahead but agreed sales this month are down.
Leaf, a former Rics residential chairman, said: ‘Buyers and sellers are negotiating hard to get deals over the line even though some are falling through if the price gaps are just too wide. Fortunately, a large proportion of sellers are still sitting on additional equity gained from the lift the stamp duty holiday gave to property values, making paper losses easier to come to terms with.”
Nathan Emerson, boss of Propertymark, a trade body that represent around 18,000 individual agents across the UK, said members have reported a “slight dip” in sales from April to May of this year. He said that is expected given the current economic climate.
According to property website Zoopla, there has been a jump in the proportion of sellers (42%) having to accept discounts of 5% or more off the asking price to achieve a sale.
