The average asking price for a home in Britain fell by 0.6% (£2,113) in June, marking the largest price drop recorded for this month in 14 years, according to property website Rightmove.
The month-on-month decline brought the average asking price across Britain to £376,191. Rightmove noted that June typically sees modest price increases, but this year, a combination of factors has led to an unusual downturn.
Rightmove suggested that May's warmer weather may have triggered an earlier-than-usual summer slowdown, while the World Cup could also be distracting some potential home movers. Additionally, more affordable regions like the North East of England and Scotland are seeing prices hold up relatively well compared to last year.
Colleen Babcock, property expert at Rightmove, commented: “It’s unusual to see a price fall of this size in June, as we would normally expect modest price growth. What’s different this time is a combination of factors, including wider economic uncertainty, the timing of the May bank holiday and unusual heatwave, and the high number of homes on the market, which together appear to be bringing forward the traditionally slower summer market. In this kind of market, sellers need to work harder to attract attention. Setting a competitive asking price from the outset is key, as buyers are taking more time to compare options and are quick to move on if a home doesn’t stand out on value.”
Rightmove highlighted that higher mortgage rates continue to weigh on activity, squeezing many household budgets. The wider choice of homes for sale encourages buyers to take a less urgent approach unless a property truly stands out.
Ms Babcock added: “While the summer market has come a bit early this year, overall activity is still within a typical historic range. What has changed is some buyer behaviour; with more homes to choose from and higher borrowing costs, buyers are deliberating more and taking longer over their decisions.”
Matt Smith, a mortgage expert at Rightmove, said: “It’s encouraging to see mortgage rates edging down slightly, and even relatively small reductions can make a difference to buyers’ budgets.”
Marc von Grundherr, director of Benham and Reeves, London, noted: “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.”
Henry Crane, a partner at James Laurence Estate Agents, Birmingham, said: “Overall, while demand remains, it is highly price-sensitive and selective, with the best-positioned homes continuing to perform strongly.”
Matthew Harvey, a partner at Tayler & Fletcher, Cotswolds, added: “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.”
Separately, a report from property firm Hamptons indicated that the average price of a newly agreed let in Britain rose 1.1% over the year to May, slowing from a 1.2% annual increase in April. The average rent paid by a tenant moving into a property in Britain was £1,382 per month in May.
Regionally, the South East of England saw average new let rents reach £1,500 per month in May, up 2.0% annually. Hamptons noted this is the first time any region outside London has reached the £1,500-per-month mark.
Aneisha Beveridge, head of research at Hamptons, commented: “While rental growth on newly agreed lets remains cool by recent standards, landlords appear to be taking a more cautious approach when selecting new tenants. Many are showing a willingness to wait for the right tenant rather than accept the first offer, which has reduced the number of homes let and helped to keep a lid on rental growth for new tenants.”
Hamptons’ monthly lettings index, running since 2011, uses data from the Connells Group to track changes in the cost of renting, based on achieved rather than advertised rents.
Here are average monthly rents for newly let homes in May, according to Hamptons, and the annual change:
- London: £2,294, 0.6%
- East of England: £1,225, 0.3%
- South East: £1,500, 2.0%
- South West: £1,265, 0.9%
- East Midlands: £987, -0.9%
- West Midlands: £1,107, 2.6%
- North East: £856, 3.8%
- North West: £1,042, 1.8%
- Yorkshire and the Humber: £927, 1.4%
- Wales: £887, 1.1%
- Scotland: £1,029, 0.6%
