House Prices Flat In July, Says Rightmove

15 July: Market Holds Breath As Bank Rate Decision Looms

• July asking prices dip 0.4%
• Prices up 0.4% annually
• Sales agreed up 15% year-on-year
• Average price £373,493

The average asking price of property coming onto the market fell by 0.4% in July, (£1,617 in cash terms), according to online property site Rightmove, down on the long-term average for July of falls of 0.2%, writes Jo Thornhill.

Asking prices have been largely static over the past 12 months, rising 0.4% in the year to July, as the market has been affected by higher mortgage costs. The average asking price across the country now stands at £373,493.

Rightmove says market activity was broadly steady during the general election campaign. It says there is evidence many potential buyers and movers are waiting for the first cut in interest rates by the Bank of England (its next meeting is on 1 August), while some are continuing with their moving plans.

The number of sales agreed is 15% higher than the same period a year ago, when mortgage rates were approaching the peak. The Bank of England Bank Rate, the benchmark interest rate, has been at a 16-year high of 5.25% since August last year.

Buyer demand remains stable, although there has been a drop in demand of 2% in the first-time buyer sector, where buyers are likely to be most rate and price sensitive.

Regionally, asking prices have risen, albeit marginally, over the past year in most areas, but particularly in the north of England and Scotland, where average property prices tend to be lower than the Midlands and South of England.

Average asking prices are up by 1.7% in Scotland, year on year (average asking price is now £195,344), by 4.6% in the North East of England (£193.043) and by 3.5% in the North West of England (£264,256). Prices are also up annually in Wales by 1.9%, where average asking prices are now £265,679).

In contrast, prices have fallen over the past year, by 1% in the South West of England (average asking price is £392,961), by 0.9% in the South East (£485,733) and by 0.4% in the East of England (£424,262).

While asking prices fell by 0.4% in July in London, asking prices are up over the past 12 months by a marginal 0.6%. Experts report prices have been largely flat in the capital. The average asking price stands at £692,544.

Tim Bannister, Rightmove’s director of property science, said: “A key concern for many home movers is when the first Bank of England rate cut will be, and there are signs that some pockets of movers are waiting for this before acting. Overall buyer demand, measured by the number of would-be buyers contacting estate agents about homes for sale, has remained stable in the last four weeks when compared with this time last year.

“An interest rate cut is expected to lead to lower mortgage rates, which could be the gamechanger for some would-be movers who are being held back by significantly higher monthly mortgage costs.”

Matt Nicol, managing director at estate agent Nicol & Co, in Worcestershire, said: “We have seen a positive first half in 2024, with the market feeling reminiscent of pre-Covid times, which continued despite the prominent issues of Brexit and the general election.

We’re experiencing healthy supply and demand levels, but the lack of mid-market homes has meant that first-time sellers are finding their options limited.

“Despite this, valuations and instructions remain strong, backing up the historical data that shows elections have minimal market impact. With inflation down to 2% and potential interest rate reductions ahead, the outlook remains optimistic.”

Nathan Emerson, chief executive at trade body Propertymark, said: “Any slight dip in house prices is likely to only be a temporary phase following a period of uncertainty triggered by the recent general election. Once we start to hear more news from the new government about how they intend to build 1.5 million new homes before the end of this parliament, alongside their other priorities for housing, this should give consumers the certainty they need to determine if they will relocate or not.