Cut prices or face stagnation next year, warns Rightmove

Miles Shipside from Rightmove said the stark choices facing home owners and estate agents as we go into 2005 with the housing market have all but seized up. It’s a matter of cut prices now or run the risk of a longer-term stagnation in 2005 as buyers still find home ownership too expensive. Rightmove added that a rate cut by the Bank of England could also provide a welcome boost to the market.

Rightmove exlplained asking prices are down a meagre 0.3%, or less than £600 – not enough to tempt buyers back who await a meaningful price correction or cut in borrowing costs to improve affordability

It added demand and supply are now severely out of kilter; time on market continues its sharp upward trend since June; estate agents are set to enter 2005 with stock levels over a third higher than in January 2004 and that the 'life is being squeezed out of the housing market’ by soaring house prices and five interest rate rises.