‘Buyers’ market’ as property asking prices rise more slowly than usual
Across Britain, the average asking price for a property increased by 0.3% month-on-month, or £1,199 in October, Rightmove said.
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The average price tag on a home has increased by less than usual for the month of October in what is currently a market favouring buyers, according to a property website.
Across Britain, the average asking price for a property increased by 0.3% month-on-month, or £1,199, to reach £371,958 in October, Rightmove said.
The website said this is a lower monthly increase in new seller asking prices than is typical at this time of year, with asking prices rising by 1.3% on average in the month of October over the longer term.
Rightmove said that, with a greater choice of properties to consider, buyers are making use of their increased negotiating power, helping to keep price rises subdued.
The more muted price growth is also in part down to some sellers heeding advice to price attractively to find a buyer, particularly with seller competition rising, the report suggested.
Tim Bannister, Rightmove’s director of property science said: “This month’s subdued price growth comes as buyer choice soars to a level not seen since 2014.
“With the ball in the buyer’s court and the pick of a big crop to choose from, sellers need to be pricing competitively to find a buyer, particularly with affordability still very stretched.
“Some sellers appear to be acting on this caution, contributing to limited price growth and better buyer affordability.
“This is helping to keep the number of sales being agreed consistently and strongly ahead of the quieter market of this time last year.
“We’re not seeing activity slow down, but some estate agents report that some movers are now waiting for Budget clarity and anticipated cheaper mortgage rates later this year. However, others state that movers are largely just getting on with plans.”
Rightmove said sales activity has “bounced back” compared with last year and has continued heading upwards.
The number of buyers contacting agents about homes for sale has also increased compared with last year.
Competition between sellers to attract buyers is particularly intense at the top-end of the market, where the number of four-bedroom detached houses and five-bedroom-plus homes available for sale is ahead of last year.
The report said: “It’s a buyer’s market, reinforcing the need for sellers to price competitively while affordability is stretched and choice is high.”
Mr Bannister said the “big picture still looks positive for the market heading into 2025”.
2025 could see the return of the previously priced-out buyer
He said: “Market activity remains strong, despite affordability pressures on movers.
“Once we have more certainty about the contents of the Budget, hopefully followed by speedy second and third (Bank of England base rate) cuts, we could see another surge in market optimism like we had in the summer.
“Affordability is still the biggest barrier facing many movers, with mortgage rates still high, so if the expected two cuts come to fruition it could be the boost that many buyers-in-waiting need. 2025 could see the return of the previously priced-out buyer.”
Chris Rowson, managing director of Sharman Quinney estate agents, which covers Cambridgeshire, Lincolnshire and Northamptonshire, said: “We’ve seen a surge of new instructions in September and is one of our busiest months for new sellers in the last decade.
“We’ve also seen a good jump in new potential buyers, as well as agreed sales in the area, so it’s been busy.”
Joel Baseley, founder and director of Rampton Baseley in London said: “We’ve seen one of the best years for number of transactions in our 18-year history and while activity has been exceptional, price growth has been muted.
“This could be down to the ‘new normal’ of higher interest rates but also a particularly steep increase in values post-pandemic which will need more time to level off.”
Many serious buyers seem to be in the driving seat when it comes to negotiating on their next home move due to the vast choice of properties on the market
Marc von Grundherr, director of Benham and Reeves in London said: “Mortgage approval levels have been strengthening for much of this year and we’re now seeing this increase in buyer demand start to filter through to actual sales, with monthly transactions being the strongest since 2022.
“This improving market momentum has also helped to tempt many sellers back into the market who had previously put their plans to move on pause.”
Nathan Emerson, chief executive of property professionals’ body Propertymark said: “Many serious buyers seem to be in the driving seat when it comes to negotiating on their next home move due to the vast choice of properties on the market.
“Furthermore, with the Bank of England’s next announcement on interest rates looming, some buyers will be cautious with their current budgets or will be waiting in the wings to see what its decision will mean for the market before moving.”
The report was released as a lettings index from property firm Hamptons said the average rent for a newly-let property in Britain hit a new high of £1,384 per month in September, although the pace of growth slowed.
Annual rental price growth was 4.5% in September, slowing from 5.0% in August and 11.7% in September 2023.