Today's Rightmove figures showing a drop of 2.2% in the price sellers are asking for their homes provides a reminder of the need to remain cautious about the direction of the housing market.

The numbers are obviously being spun to point to the £5,000 drop in prices providing summer bargains to buyers.

More interestingly perhaps though is that some of the biggest falls are in London and the South East, where sellers have enjoyed the better of things over the past year.

But for all that, not too much should be read into these figures.


...with transactions down all housing statistics are less reflective of what might be described as the "real current price" for a house.

Seasonal factors also play a part in distorting the figures. Firstly because there appears to be a seasonal fall anyway and secondly because even fewer homes come onto the market during the holiday period, so the smaller than normal sample we currently see is made even smaller.

However, I noted an interesting piece in the Financial Times that should send a further cautionary message to those with a tendency to over exuberance when it comes to house prices. It seems that those bidding in auctions are once again seeing growth in the discounts available.

This would be suggestive of a softening in prices and is billed by the FT as an early indicator.

Without prodding the data in more detail I am a bit cautious about over reading it. There may prove to be something in it, but regional, seasonal or market segment factors may be at play distorting the aggregate figure and leading to a misinterpretation if this is then applied to the housing market as a whole.

Either way, put the two bit of information together and it does suggest reasons for a pause for thought before jumping to the conclusion that the only way is up for house prices from here.