UK Asking Prices Rise 0.7% in September Despite Low Sales
Rightmove data shows a 0.7% monthly price increase in September, marking the first rise since May, though sales remain challenging.
Key points
- Average UK asking prices rose 0.7% in September to £367,440, the first monthly increase since May.
- Scotland sees a 91% home sale success rate, while London records only 42% for listed properties.
- Fixed mortgage rates are rising despite the Bank of England holding base rates at 3.75%.
The average asking price for a UK home rose by 0.7% in September. This marks the first month-on-month increase since May, according to Rightmove. The national average now stands at £367,440, representing a gain of £2,441 per property. This September uplift exceeds the ten-year average of 0.5% for the month, signaling a potential seasonal recovery.
Despite this short-term gain, prices remain 0.8% lower than a year ago. They are also 2.3% below levels seen at the start of summer. A particularly quiet summer, driven by heatwaves and the World Cup, may have delayed transactions. This backlog could fuel a stronger rebound as buyers return from holidays. However, the market remains crowded with a 12-year high in available homes.
Regional sales success varies widely
The probability of a home finding a buyer differs significantly by region. Scotland leads with a 91% success rate for listed properties. This high figure partly reflects local transaction practices and demand patterns. In contrast, London sees only 42% of homes sold. The South East of England records a 56% success rate. The North West of England achieves a 71% rate, indicating strong regional disparities.
Rightmove notes that 74% of homes sold this year were priced correctly initially. These properties did not require subsequent price reductions to secure a sale. Sellers face stiff competition due to the high volume of listings. Accurate initial pricing is therefore critical for attracting limited buyer interest. A realistic approach or high-quality finish is essential in this crowded environment.
Mortgage costs pressure buyer demand
Buyer demand is currently below levels recorded in the same period last year. Affordability remains a significant barrier for prospective purchasers in the UK. The Bank of England held interest rates at 3.75% last week. Nevertheless, average fixed mortgage rates have been increasing in recent weeks. This trend is driven by rises in underlying swap rates used for pricing.
Financial experts warn that mortgage rate volatility continues to challenge many buyers. Expectations for future monetary policy influence current fixed-rate pricing. Consequently, home buyers are expected to remain cautious and price-sensitive. This caution limits the number of active buyers in the market. Sellers must therefore compete for a smaller pool of qualified purchasers.
Market outlook for autumn transactions
Rightmove suggests the current market is challenging for sellers. The number of homes available is at a 12-year high for this time. Buyer affordability remains stretched, limiting the pool of active purchasers. Sellers must set realistic prices to stand out in the crowd. A high-quality finish can also help attract limited buyer interest. Competitiveness is key to securing a sale in these conditions.
Yahoo Finance UK reports that activity is picking up as autumn begins. This follows a subdued summer period for the housing sector. The underlying desire to move remains strong among residents. However, mortgage rate volatility poses a significant ongoing challenge. Buyers are expected to remain cautious in the coming months. Sellers should adjust their strategies to match local market realities.
