Prices Pushed up by low Interest Rates and dip in Seller Numbers - Rightmove HPI

LONDON, May 16, 2011 - The Rightmove House Price Index for May 2011 is released today and
reveals that average asking prices for new properties coming to the market
saw a 1.3% increase over the past month to now stand at GBP238,874.

Base rates of 0.5% and continuing lack of mortgage availability are
enabling the housing market to stay in its 'low transaction limbo', with few
forced sellers driving prices down and few genuinely proceedable buyers. With
such low transaction volumes, asking prices do not necessarily reflect the
market fundamentals, so continuing demand for good quality property
(www.rightmove.co.uk/) in better areas and a lack of pressure to sell
have enabled prices to appear to defy gravity. New sellers' asking prices are
now only 1.5% below May 2008's peak of GBP242,500, although the recent
resurgence of inflation means that they are down by around 10% in real terms.

Miles Shipside, director of Rightmove comments: "The Bank of England's
decision to hold interest rates at unprecedented low levels, compared to all
other property market downturns, has disrupted the traditional economic
formula of an excess of supply over demand leading to lower prices. It has
thrown some sellers a lifeline in their quest to hold on to the gains they
made during the boom era, though the market has failed to build up a head of
steam due to continuing red signals from mortgage lenders, and the normal
spring momentum being diverted into a siding by the warm weather and the
Royal Wedding."

The lack of listings coming to market during the extended bank holiday
period for Easter, the Royal Wedding and May Day no doubt had an effect on
new sellers' asking prices, as a slump in seller numbers leads to some estate
agents (www.rightmove.co.uk/estate-agents.html) competing for new
instructions by agreeing to market at unrealistic prices. The weekly run-rate
of new instructions prior to the Easter holiday was circa 29,000. In the two
week period between the holidays this fell by 30% to an average of just
20,000, resulting in higher average asking prices for properties coming to
market in the latter part of the period.

Shipside adds: "Estate agents usually see their stock turnover more
quickly during the spring, but this year's slower market suggests that stock
levels may exceed Rightmove's previous record of 79 properties per branch
over the next few months."

For further statistics and to download the Rightmove May 2010 House Price
Index please visit - www.rightmove.co.uk/news/house-price-index or
search for local house prices (www.rightmove.co.uk/house-prices.html)
at www.rightmove.co.uk/house-prices.html

Rightmove Press Office, press@rightmove.co.uk, +44(0)207-087-0700

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