Estate agents are reporting a sluggish start to the autumn housing market, with buyers holding back, mortgage rates rising and sellers under increasing pressure to reduce asking prices. The traditional post-summer recovery has yet to materialise in some areas, despite signs of renewed interest from prospective buyers.
House price growth halves
The warnings follow Nationwide’s latest House Price Index, released yesterday. Annual house price growth halved to 0.8% in September, down from 1.6% in August. Prices also fell by 0.2% month-on-month, taking the average UK property price to £274,251.
With mortgage approvals falling and uncertainty ahead of the Autumn Budget, agents face a challenging final quarter.
Sellers warned against overpricing
Nicky Stevenson, managing director of Fine & Country, said buyers had more choice and were increasingly unwilling to pay inflated asking prices. She commented: “Nationwide’s latest figures underline just how finely balanced the housing market remains. This is a market where buyers have more choice, and that means competition between sellers is particularly strong.
“While autumn typically brings a fresh wave of activity as people return to their routines and revisit moving plans, many buyers are still sitting tight for the time being.”
Home searches are reportedly 7% higher than a year ago, but Stevenson warned that renewed interest would not necessarily translate into sales. “Sellers who price realistically from day one will be best placed to convert any renewed interest into viewings and offers. In a market where buyers can afford to be selective, overpricing risks leaving a property behind the competition rather than creating the momentum seller are looking for.”
Iain McKenzie, chief executive of The Guild of Property Professionals, said rising borrowing costs were making the usual autumn recovery more difficult. “Swap rates have risen and some lenders have responded by increasing mortgage rates, putting further pressure on purchasing power. Net mortgage approvals for house purchase also fell to 54,900 in August, below the previous six-month average,” he said.
Nevertheless, McKenzie said the rise in property searches suggested buyers were returning to the market, even if many were not ready to commit. He added: “The autumn market is therefore likely to be characterised by genuine demand, but also a high degree of caution, with affordability and pricing continuing to determine whether interest translates into transactions.”
London market ‘far too quiet’
Simon Gerrard, chairman of Martyn Gerrard Estate Agents, said the lack of activity in London was particularly concerning. “I’m not surprised by these figures but it’s worrying that we’ve not seen more activity following the summer holidays. The market in the capital is far too quiet and enquiries from ordinary families are sharply down compared to previous years,” he said.
Gerrard welcomed the prospect of renewed government support for first-time buyers but warned that any new scheme must reflect regional differences in property prices. He argued that income and deposit limits should account for London’s higher housing costs to avoid excluding buyers who need assistance.
Gerrard also highlighted the difficulties facing existing homeowners looking to move up the property ladder. “For all the recent talk of an autumn bounce, there’s a noticeable lack of ordinary families buying at the moment. Many second-steppers are struggling to move up the ladder,” he said.
He called for higher stamp duty thresholds for first-time buyers in more expensive areas and warned that further property tax increases could discourage transactions.
Further slowdown expected
Tom Bill, head of UK residential research at Knight Frank, said higher mortgage rates were increasingly affecting demand. “House prices are stalling as the impact of rising mortgage rates takes its toll on demand, a pattern we expect to continue in the final three months of this year,” he said.
“Mortgage approvals fell 14% against the five-year average in August, which means transaction numbers will also increasingly feel the squeeze.”
Bill said the outlook beyond 2026 would depend on developments in the Middle East and the property-related measures announced in the Autumn Budget. For agents, the immediate challenge is converting buyer interest into agreed sales in a market where affordability and realistic pricing remain decisive.
