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Asking prices for newly listed homes in Britain recorded their sharpest August decline since 2018, with the average price falling 2.0% over the four weeks to August 8, according to Rightmove. The fall was larger than the typical 1.3% August decline seen over the past decade. Prices were also 1.0% lower than a year earlier, marking the biggest annual decline since December 2023. A large supply of homes, seasonal weakness and higher mortgage rates are putting pressure on sellers. Buyer demand has improved modestly, but remains below last year’s level.
The average asking price of a newly listed UK home fell 2.0% over the four-week period, taking it to GBP 364,999, according to Rightmove. The decline was considerably sharper than the 10-year average August fall of 1.3% and marked the largest drop for the month since 2018.
Rightmove said the summer slowdown and the unusually high number of homes available for sale have increased competition among sellers. The number of properties on the market is at a 12-year high for this time of year, giving buyers more choice and putting pressure on sellers to price their homes competitively.
On an annual basis, average asking prices were 1.0% lower, marking the biggest year-on-year decline since December 2023. The weakness was particularly visible in southern England, while northern markets continued to perform better.
London recorded the sharpest annual decline, with asking prices down 3.1% from a year earlier. The capital also saw a 4.4% monthly fall, the largest monthly decline among the regions tracked by Rightmove. The agency said London has its highest level of property choice since 2010, increasing competition between sellers.
The regional picture remains uneven. Prices in the North East were 1.7% higher than a year earlier, while the North West recorded 1.9% annual growth. Yorkshire and the Humber was up 0.9%, and the West Midlands increased 0.7%. Scotland also recorded annual growth of 1.1%. In contrast, prices fell 2.1% in the South East and 1.8% across southern England overall.
Buyer activity has shown a modest improvement since Andy Burnham became prime minister, with Rightmove reporting a 5% increase in buyer demand. However, demand remained 10% below the level recorded a year earlier. Rightmove said it was too early to determine whether the recent improvement would lead to a sustained change in the market.
Mortgage costs are also weighing on affordability. Rightmove’s tracker showed the average two-year fixed mortgage rate at 5.09%, up from 4.95% a month earlier. The return of fixed mortgage rates above 5% has added pressure on buyers who depend on borrowing, particularly as uncertainty around interest rates continues.
The increase in available homes is another important factor. Rightmove data showed that agents had an average of 65 properties per branch in July, while the average time for a property to secure a buyer was 63 days. Homes that are priced correctly are therefore more likely to attract buyers, while properties that are priced above market expectations can remain available for longer.
Rightmove has also revised its outlook for the UK housing market. It now expects national average asking prices in 2026 to remain broadly flat or fall by as much as 2%, compared with its earlier forecast of 2% growth. The revised outlook takes into account higher mortgage rates, wider economic and geopolitical uncertainty and the potential impact of the October Budget.
The current market is not uniformly weak across Britain. Northern regions and Scotland continue to record annual price growth, while London and parts of southern England face greater pressure from high levels of available stock and weaker demand. This regional gap is likely to remain an important feature of the market as buyers continue to have greater choice.
Source Reuters
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