House prices stall as new sellers appear

New research has shown that house prices were pegged back in June as more new people wanting to sell properties came into the market.

The research, from property website Rightmove, showed that the price of a property in England and Wales rose just 0.3% in the five weeks to June 12, compared to 0.7% the previous month and the 2.6% rise seen in April.

The month saw 22% more people putting their homes on the market with the disproportionate rise seen as attributable to the abolition of Home Information Packs (HIPs). However there has been a slowdown in the number of potential buyers with some investors cautious about the impending rise in capital gains tax announced in the Budget.

The small rise in property prices is not reflected throughout the country. While Greater London saw a rise of 2.2%, prices fell by over 3% in the West Midlands and 1.6% in Yorkshire and Humberside.

Mike Shipside, commercial director at Rightmove said: “The continuing mortgage famine has now been joined by a surge in sellers following the abolition of HIPs and investor reticence driven by rumours of CGT increases. Together these factors are likely to put an end to this year’s recovery in house prices.”

A separate survey, from Moneyfacts, revealed that the average cost of a two-year fixed term mortgage has fallen to its lowest level in nearly seven years. Interest rates on such deals have fallen since August last year to an average of 4.52% today.

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