How Long Will 'Mr Average' Have to Rent? Rightmove House Price Index February 2011

LONDON, Feb. 21, 2011 /PRNewswire/ -- Rightmove today reports that new sellers coming to market this month mimicked those of February last year, raising their asking prices by 3.1% in the month to an average of 230,030 pounds, leaving year-on-year prices virtually the same too (+0.3%). With lenders stating that they expect mortgage lending to remain static at around 2010 levels throughout 2011, and new seller numbers practically unchanged year-on-year  what might have been seen as a passing phase of low transaction levels in the housing market now looks set to be the norm for the foreseeable future.

Miles Shipside, director of Rightmove, comments: "Any hopes that transaction volumes may be on the springboard preparing to return to historic norms will have been dashed by lenders' predictions that 2011 lending volumes will match 2010's dire levels. The current subdued market volumes are set to be the new norm unless the seemingly never ending discussions between Government and mortgage lenders find some way of increasing 'Mr Average's' access to lower deposit mortgages without pricing them out of the market."

The number of new properties for sale coming to market remains subdued as a substantial element of the mass market is 'locked in' to their existing homes. Average unsold stock levels per agency branch have now declined for five consecutive months, falling from a peak of 78 properties to the current level of 69.  The main exception to muted new seller numbers is London, which is up 21% on the same period last year. This is further evidence that the more elite and southern based markets have some immunity from the effects of stunted equity growth and problems accessing mortgage finance. The remainder of the country has seen new listing numbers remain more stable, being marginally up by just 6% year-on-year on the same period last year.

Shipside adds: "If consumer price inflation continues to marginally outstrip house price inflation, then in a slow process over several years buyer affordability will improve. Mortgage debt will be eroded and any average wage rises will further assist. The mass market is unlikely to recover to former volumes without the return of healthier access to credit, so continuing falls in the percentage of owner-occupiers and a consequent growth of the rented sector is the realistic prospect."

For further statistics and to download the Rightmove February 2011 House Price Index please visit - http://www.rightmove.co.uk/news/house-price-index or search for local house prices at http://www.rightmove.co.uk/house-prices.html

Rightmove Press Office, [email protected], +44(0)207-087-0700

SOURCE Rightmove Group Ltd