Properties are selling for less than expected as the number of home sales continues to fall

• Propertymark has issued its latest report into the state of the housing market
• Report revealed a 28 per cent drop in the number of new properties for sale
• There was also a 31 per cent decrease in the number of buyers registered

The number of property sales continued to fall at the end of last year, while more properties are selling for less than expected, a new report suggests.

The report is the latest insight into the state of Britain’s housing market, and has been published by property agents trade body Propertymark.

It said that there was a 28 per cent reduction in the number of new properties coming to market last month.

And at the same time, there was a 31 per cent decrease in the number of buyers registered.

The number of sales agreed was also down, with the report saying they continued to fall to just four for every estate agency branch in December, down from six the previous month.

This lower demand helps to explain the slight increase in the percentage of agents reporting homes selling for less than the asking price.

There was also a slight decrease in the number of agents reporting that properties were selling at asking price.

Estate agents described December as a ‘gloomy’ month, but a new picture is emerging at the beginning of 2024 with a notable uplift in the number of buyers now registering.

Alex Lyle, of estate agents Antony Roberts, said: ‘Last year we noted a real return to seasonality. December tends to be quieter as you are fighting against Christmas, there are few new buyers, little new stock and people who are toying with the idea of moving sit on their hands and wait for the new year.

‘There was little good news before Christmas, aside from another hold in base rate from the Bank of England. That was the start of something but not significant enough to motivate buyers and sellers as lenders hadn’t really started reducing their mortgage rates.

‘If you asked sellers in December how confident they were about finding a buyer, they would have been pretty gloomy about their prospects. 

‘There is a fair chance they would have been on the market for some time as few choose to launch in December, so it would be likely that their property had been for sale since September or October, when the market was busier. Come December and if they haven’t sold by then, they may be thinking their chances have slipped.

‘It’s worth noting that the picture is quite different since the turn of the year with a significant increase in buyers registering and a surge in activity which means our agents’ diaries are full.’

And Nathan Emerson, of Propertymark, said: ‘December marks the end of an interesting and challenging year within the property market.

‘In the wider economy interest rates have stabilised, however, inflationary concerns remain, and GDP growth has been anaemic.

‘In response to these and other factors, house prices have fallen in some areas.’

Its latest figures stated that the average house price dropped to £301,613 in November, down from £305,148 in October. 

Mr Emerson added: ‘In the residential sales sector, we have reached the trough of the seasonal trend that begins in Autumn and runs to Christmas.

‘Key supply and demand indicators, such as the number of buyers registered and number of new sales instructions, are at their lowest points in the year.

‘As we head into 2024, pressures remain on house prices, with further adjustments required to match valuations to market expectations.

‘Looking forward to January, we can expect a lively start to the year, whether or not this sets the pace for the year as whole will depend on the stability of the wider economy and the actions of policymakers.’

Back in December, Nationwide Building Society separately reported that house prices ended 2023 down 1.8 per cent compared with a year ago.

It said the typical home in Britain was then worth £259,157, almost 4.5 per cent below the all-time high recorded in late summer 2022.

While house prices have only fallen slightly over the past 12 months, the number of homes being bought and sold was severely down in 2023.

The total number of transactions has been running at around 10 per cent below pre-pandemic levels during the past six months, according to Nationwide, with those involving a mortgage down by around 20 per cent, reflecting the impact of higher borrowing costs.

However, fixed mortgage rates are continuing to fall back from their summer peak.