This summer, the average UK home is nearly £11,000 ($14,900) cheaper than it was three months ago, as asking prices continue to fall.
According to property website Rightmove, average asking prices dropped by 1.3% in August to £368,740. The decline follows steeper falls in June and July, marking the sharpest three-month downturn in years.
More than one in three properties on the market have had their prices reduced since first being listed, reflecting a shift in supply and demand as more homes compete for fewer buyers.
Analysts say the housing market is undergoing a correction, unwinding last year’s momentum from stamp duty reforms and fading optimism about interest rates.
Buyers benefit from high choice and falling rates
The shift has meanwhile presented a rare opportunity for buyers. Housing supply rose nearly 10% compared to a year ago and is the highest in nearly a decade. This equates to greater selection and smaller negotiating strength for buyers.
Although values have decreased, the cars are still selling shockingly well.—This is a strong showing. It was the best month for sales in five years, with agreed deals 8% higher than a year ago. That makes July the busiest month since the post-COVID bounce-back in 2020.
Borrowing costs are also easing. Two-year fixed mortgages on average have fallen from 5.17% earlier this year to about 4.5% After three cuts in the Bank of England Base Rate in 2025, lenders have been reducing their rates to be competitive.
Nonetheless, analysts caution against aggressive easing moves as the central bank starts to address inflation pressures that have broadened the economy.
Sellers compete hard to close deals
The market has been tougher for sellers. Compared to the recent past, though, there are a lot more homes around, meaning buyers have a much larger smorgasbord of choice, forcing prices down. Failing to price a property at its true value will only deter buyers who can easily scroll to the next house available.
The extent of this can be seen using the data from Rightmove. Those homes that DO get buyer attention in 79 days on average are priced competitively right from the start, and sellers are walking away with about 94% of their list price. By comparison, homes that need to be lowered are staying on the market as long as 99 days (almost three months). This large spread reinforces the need for sellers to position their homes properly in the beginning and not chase the market downward afterward.
More sellers, faced with fierce competition, agree to reduce their asking prices earlier in the selling process. A growing chorus of agents is cautioning sellers not to aim too high, but instead list homes at “attractive” prices that may generate fast attention and potential offers. Those figures mark a departure from recent years for sellers, who had the luxury to hold out for higher offers while a rapid turnaround in the market.
Rightmove, meanwhile, reduced its forecast for the market as a whole in the future. It is expected to see a smaller 2% increase in UK house prices by 2025, falling from forecasts of 4%. The revision indicates a combination of substantial supply, more cautious buyers, and only limited relief to mortgage costs.
The consensus among industry experts is that buyers are now fully in the driver’s seat. A bit more product for sale may serve to the advantage of buyers as interest rates slowly descend into affordability again, allowing buyers time to haggle. Though the market is quite competitive, sellers can make a deal with careful pricing and a good presentation.
Colleen Babcock of Rightmove said: “Buyers have the upper hand in this high-supply market, so a tempting price is vital to agree a sale.
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