Average asking prices fell by more than £2,100 in June, marking the biggest drop for the month in 14 years as sellers responded to increased competition and a slower-moving market.
New data from Rightmove shows the average price of a newly listed home declined by 0.6% (£2,113) over the month to £376,191. June typically records modest price growth, making this year’s fall the largest for the month since 2012.
The property portal said a combination of high housing supply, a more price-sensitive buyer market and an earlier-than-usual summer slowdown contributed to the decline. It added that May’s heatwave may have brought forward seasonal market trends, while the ongoing football World Cup could also distract some prospective movers.
Biggest June house price drop in 14 years signals more realistic pricing – Property Industry Eye
Industry reaction:
Nathan Emerson, CEO of Propertymark: “The latest figures suggest the market is continuing to find a more sustainable balance, rather than experiencing a loss of confidence. Buyers remain active but are taking more time to make decisions, meaning realistically priced homes continue to attract strong interest.
“National trends also mask significant regional differences, with local affordability, supply levels and demand continuing to shape market performance. In many areas, particularly where stock remains constrained, well-presented and competitively priced properties are still selling well.
“This reinforces the importance of professional advice. Accurate pricing and a strong understanding of local market conditions are helping buyers and sellers navigate a more competitive marketplace.
“While further improvements in mortgage affordability would support confidence, the overall level of transactions shows there remains a solid appetite to move despite ongoing economic pressures and seasonal distractions.”
Jeremy Leaf, north London estate agent: “In our offices, sellers wanting to attract genuine buyers have been obliged to accept a larger dose of realism when it comes to asking prices, which are increasingly recognised as an aspirational starting point only.
“The amount of available stock – particularly flats – as well as concerns about the cost of living and mortgage rates, are making first-time buyers nervous about making financial commitments so the market is becoming even more price sensitive.
“Most sales are holding up but that lingering uncertainty about economic prospects is prompting lengthier transactions, which in turn increases the risk of further re-negotiation or even collapse.”
Marc von Grundherr, director of Benham and Reeves: “Buyers aren’t moving at the pace we’ve seen in previous years, largely because current market conditions and an oversupply of stock are affording them the luxury of both time and choice.
A larger than usual dip in asking prices also suggests that sellers are finally accepting this reality and pricing to sell, rather than pricing according to their own expectations.
So, whilst a quick sale is certainly still achievable, sellers shouldn’t be disheartened if they don’t find a buyer immediately. Today’s market rewards patience, pragmatism and proper pricing, and those sellers who embrace these realities are the ones most likely to achieve a successful outcome.”
Tom Bill, head of UK residential research at Knight Frank: “The Middle East conflict has sapped seasonal momentum from the housing market. Prices and transaction numbers are softer than expected for the time of year as higher mortgage rates take their toll on buyers. Activity will be kept in check for the foreseeable future as the Bank of England holds rates steady and political uncertainty ramps up after this week’s by-election, which means we expect modest UK house price growth of 1.5% this year.”
Henry Crane, partner at James Laurence Estate Agents: “From our perspective across the Midlands, we’re seeing a clear split in the market. Leasehold properties, particularly those with service charge increases or lease issues, are seeing softer demand and less urgency from buyers.
In contrast, the freehold market is moving at a quicker pace. Well-presented, sensibly priced freehold homes are attracting strong interest and continue to sell quickly and competitively, effectively operating within their own micro-climate. Overall, while demand remains, it is highly price-sensitive and selective, with the best-positioned homes continuing to perform strongly.”
Matthew Harvey, partner at Tayler & Fletcher: “The Cotswolds market remains resilient. Demand is strong from early retirees downsizing into central locations, as well as families drawn by schooling, across both the £300k–£400k and £500k–£1m segments.
As we move into early summer, transactions are picking up, supported by improved confidence around borrowing rates. The lower middle market is absorbing increased supply, driven in part by landlords exiting, with well priced homes attracting family buyers looking for more space. Demand in the higher middle market remains steady, led by lifestyle and schooling needs.
At the top end, price adjustments are largely a correction of earlier overpricing following the post Covid surge. Overall, realistically priced homes are selling well, with many recent listings already finding buyers. While stock is higher year-on-year, sales levels are also ahead, pointing to a more positive underlying market than headline figures may suggest.”
Polly Ogden Duffy, MD at John D Wood & Co: “The Spring market is split in two. Well-priced family homes, particularly in sought-after school catchments, continue to attract strong interest and can still achieve multiple bids.
“In contrast, the flat market is firmly in buyers’ favour, with high supply giving purchasers greater choice and negotiating power. Asking prices are adjusting, and homes that aren’t priced correctly risk sitting without interest.
“For sellers, pricing competitively from the outset is essential. Sensibly priced homes are still selling quickly to motivated buyers, while overpricing can cause properties to stall.
“For first-time buyers, this represents one of the better windows of opportunity in recent years, with more choice and greater scope to negotiate.”
Biggest June house price drop in 14 years signals more realistic pricing
Read the orginal article: https://propertyindustryeye.com/property-industry-reacts-to-latest-rightmove-house-price-index-4/
