Sellers panic driving house prices lower

With house prices falling by 2.5 percent in March, sellers seem to be rushing to put their homes on the before prices fall further, but this may be making the property slump worse.

So it's now official – house prices are falling. The Halifax found that house prices fell by 2.5% in March which has almost wiped out all the gains over the last year. The outlook is for further falls in house values according to the Halifax.

This seems to be creating a panic amongst home owners. Anticipating further falls in house prices, many are rushing to sell their home now. Some of the price reductions that we have noticed on property portals have been immense as supply is far out-stripping buyer demand.

For example, one five bedroom house in a nearby Essex town had been placed on the market soon after Christmas with an asking price of £600,000. It's owners have recently slashed that down to £500,000 in an effort to sell the property before its value falls further.

It is not just the prospect of further price reductions that is convincing home owners to sell now. With millions of fixed rate mortgages coming to the end of their term in the next eighteen months, home owners are faced with increased mortgage costs as low rate fixed rate deals are withdrawn by banks.

The double whammy of falling house prices and increased mortgage costs is forcing many home owners into a difficult position whereby the feel that they have to sell their house now, before things get worse.

The trouble is that this wave of new properties is hitting a market in which buyers are few and far between, making matters worse. Panic selling is driving asking prices downwards and encouraging buyers to bargain even harder.

So it seems that now is not the time to sell, unless you have to, however if your low cost fixed rate mortgage is coming to the end of it's term, then you will faced with higher mortgage costs soon.

It is time to take real responsibility for your personal finances.

Hopefully adopting a sensible approach to spending and borrowing will prevent you joining the wave of house sellers desperately chasing a dwindling number of buyers in the near future.