A 0.7% increase in asking prices, the first since May, is an early sign of an autumn market resurgence following a subdued summer, according to Rightmove’s latest HPI. But with enquiries 9% down on this time last year, affordability still presents significant challenges.
New properties coming to market are also down (3%), as are sales agreed (9%). Homes on the market only have a 61% chance of selling, compared to 74% in 2021 – a period Rightmove describes as “frenetic” and “driven by high demand and short supply”.
The latest market sentiment report paints a very different picture to that of five years ago: high demand and short supply have been replaced by 12-year high of homes for sale, with what Rightmove’s property expert Colleen Babcock describes as “a large crowd of sellers chasing a smaller number of buyers”.
According to Matt Smith, Rightmove’s mortgage expert, demand still exists – but caution prevails. “This month’s traditional uplift in buyer activity shows there’s still a strong underlying desire to move, but volatility in mortgage rates remains a significant challenge for many”, he explained.
“Mortgage rates have risen again over the past month, adding further pressure to monthly budgets, and the uncertainty over what may happen to rates in the medium term is likely holding back some potential movers.”
For the buyers erring on the side of caution, a new home for Christmas is now unlikely. As Rightmove points out, it currently takes around five months (150 days) to complete a move. “[T]his means that those starting the moving process now that the summer holidays are over can’t necessarily plan to move until after Easter.”
Ian Harris, president of NAEA Propertymark, welcomed Rightmove’s figures but said affordability continues to have an impact on sales.
“The return of some seasonal momentum to the housing market is encouraging, but consumers should look beyond the headline increase in asking prices”, he explained.
“With buyer demand still below last year’s level, a high number of properties available for sale and rising mortgage costs continuing to put pressure on affordability, the market remains highly sensitive to price.”
Tomer Aboody, founding director of specialist lender MT Finance, said the figures are good news for buyers, but warned there are plenty who remain deterred.
Repeating his calls for government intervention, he added: “What is desperately needed is some market stimulus, ideally via stamp duty reform, to encourage more transactions.
“These are good not only for the health of the market but the wider economy.”
The average asking price of a newly listed property in the UK is now £367,440, but with wide regional variations. Average prices are lowest in the north east of England (£199,973), with London still commanding significantly more than any other region (£657,775). London also saw the highest monthly increase in average asking prices (up 1.8%), with Wales experiencing the largest drop – down 0.4% in a month, to an average of £268,610.
