As the UK property market enters the summer months, the heat is cooling off along with the hot weather, with the average house price for new sellers falling by 1.9% to £364,895. This is the biggest drop in August since 2018, and the reason behind the price reduction is sellers looking to attract buyers who have been caught out by vacations, inflation and the Bank of England's highest prime rate since 2008. However, despite the drop in prices, the average house price is still £59,000 (19%) higher than the pre-pandemic pre-August 2019 market.
First-time buyer market firms up as UK housing sales dip
Despite some positive signs, such as an increase in average wages and a fall in mortgage rates, agreed sales have fallen by 15%, down from the same period in 2019. However, it is reassuring to see that the first-time buyer market is firming up, with a decline of just 10%. The attraction of this part of the market is record rent rises, with first-time buyers preferring to own their own homes.
Sellers need to price wisely as supply tightens in UK housing market
Currently, the supply of homes in the UK remains relatively limited, down 10% from the same period in 2019. This means that a smart pricing strategy is vital for sellers. Data shows that homes that are priced sensibly from the outset are more likely to attract buyers and can be sold within 27 days on average, whereas those that require a price reduction take 66 days to sell.
UK real estate market: a polarizing phenomenon
Overall, the UK real estate market is now clearly polarized. Highly priced homes are at risk of stagnating, while reasonably priced homes are attracting many potential buyers. However, the market continues to face a number of challenges, including rising interest rates and longer completion times. Owning a home remains an attractive option for those who can afford it, especially with the high rental market.
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Property News
2023.09.12
