House sellers are urged to slash asking prices

House sellers are urged to slash asking prices

Homeowners nostalgic for the heady days of the property boom are being urged to wake up to reality and cut asking prices to get the housing market on the move.

As Nationwide prepares to offer its latest snapshot of the sluggish market this week, experts warn that activity has slowed dramatically, despite an increase in interest from potential buyers.

'Things aren't really moving at all because there's quite a big discrepancy between buyers and sellers. Sellers are still thinking about market conditions a year or so ago,' said Milan Khatri, chief economist at the Royal Institution of Chartered Surveyors.

'A lot of people are being unrealistic,' agreed Miles Shipside, chief executive of property website Rightmove, who said sellers should make sure they take advantage of the traditional spring rebound in house-hunting activity. 'They're trying to cash in a lot of money they've made during the boom. But they've got to realise that if they miss the spring and interest rates go up again, or taxes go up after the election, things could get worse.'

Advertisement starts

---

---

Advertisement ends

Peter Bolton-King, chief executive of the National Association of Estate Agents, said estate agents themselves were partly to blame for the mismatch between buyers and sellers. 'There are still far too many overpriced properties.'

The Council of Mortgage Lenders reports that 69,000 new mortgages were taken out in March - up slightly on February, but a third lower than levels last year.

Prices for the past six months have been broadly flat. Nationwide is predicting a price increase between zero and 5 per cent for this year as a whole. Fionnuala Earley, its chief economist, said: 'We are still expecting things to be bubbling along,' she said. 'It depends how realistic sellers are being.'

Guardian Unlimited © Guardian Newspapers Limited 2005