The UK housing market has recorded its most significant summer price drop in five years, with average asking prices falling by £7,000 in July. This 1.2% monthly decline represents the largest July decrease since 2018, according to Rightmove's latest House Price Index.
Market Cooling After Pandemic Boom
After years of soaring prices during the pandemic property boom, the market is showing clear signs of cooling. The average asking price now stands at £371,907, down from £378,834 in June. While still higher than pre-pandemic levels, this adjustment suggests a shift towards more balanced conditions between buyers and sellers.
Regional Variations Emerge
The slowdown isn't uniform across the country. Some areas continue to see strong demand, while others experience more pronounced cooling. London remains the most expensive region, though price growth has moderated significantly compared to previous years.
What's Driving the Change?
Several factors are contributing to this market adjustment:
- Rising mortgage rates making homes less affordable
- Cost-of-living pressures reducing buyer budgets
- Return to more normal market conditions post-pandemic
- Increased housing stock giving buyers more choice
Experts suggest this could be the beginning of a more sustainable growth pattern after the extraordinary pandemic-driven surge in prices.
Advice for Buyers and Sellers
For sellers, realistic pricing is now more crucial than ever. Properties priced correctly from the outset are still attracting interest, while overpriced homes are staying on the market longer. Buyers may find slightly more negotiating power than in recent years, though competition remains strong for well-priced properties in desirable locations.
The coming months will be telling as the market adjusts to higher interest rates and economic uncertainty. While not a crash, this correction suggests a return to more traditional seasonal patterns in the UK property market.
