The Rightmove HPI for May was released this weeks and clearly shows how we are in the middle of a static market.

In the past we have had smallish increased and decreases each month, which averaged out shows a static market. Yet in May Rightmove have seen a straight 0% change, for the first time since they started reporting new seller asking prices.

Further key points:

• Demand lessens through combination of end of first-time buyer stamp duty assistance, some upward mortgage rate movements and renewed Eurozone jitters
• Spring supply numbers stall too, with properties coming to market down 10% on April
• Will summer sporting and Jubilee distractions continue to dampen activity like rainy May?

None of this is helped by growing mix within the market where 2 in 5 sellers are looking to trade down – spurred on by the quity rich baby boomer generation – which is outweighing the 1 in 4 sellers who are looking to trade up.

This is backed up further by the fact the ‘downtrading’ is the main reason in 9 regions in the UK. London is bucking the trend with an every affluent market.

The ‘trader-up’ volumes are off course also impacted by the end of the stamp duty incentives for first time buyers. This may totally stop things or work its way out of the system as purchasers come back.

Miles Shipside, director of Rightmove comments:

“New sellers asking more in May had become the norm, so it comes as quite a shock to see prices flat at this time of year. Perhaps the first-time buyer stamp duty holiday, and the knock-on activity it helped to create, has concertinaed the market’s stronger than expected early spring momentum into the first four months of the year rather than the usual six. The high rainfall in May will have been a further factor in dampening prospective buyers’ enthusiasm to get out and view property, and even if the forecast picks up we have a summer of sport and celebration ahead that will provide further distractions.”