The number of homes available for sale reached a ten-year high in October, as reported by Rightmove. The increase in available properties signals a shift in the market, providing more options for potential buyers. Across Britain, the amount of properties listed on the market was 12% higher compared to the same time last year, reflecting growing confidence among sellers amid stabilising mortgage interest rates.
This rise in property listings is significant for those looking to enter the housing market, as it may help alleviate some of the competitive pressures that have characterised recent years. With more homes for sale, buyers can expect a wider selection, which could lead to better pricing and negotiation opportunities. The current trend suggests that the housing market is adjusting, making it a potentially favourable time for those seeking to purchase a home.
Regional data with price and increase in stock year on year
The number of individuals contacting estate agents about properties for sale has increased significantly, rising by 17% compared to the same time last year. This surge in interest indicates a growing appetite among prospective buyers to explore the housing market. Many people appear keen to take advantage of the current conditions, as they look for suitable properties that fit their needs and budgets.
According to Rightmove, the higher volume of homes available is intensifying competition among sellers. With an increasing number of properties on the market, sellers are under pressure to attract potential buyers, which may lead to adjustments in pricing strategies. This heightened competition could result in a more dynamic market, as sellers work to make their properties more appealing to prospective buyers.
As buyers enjoy a greater choice of homes, they are finding themselves in a stronger negotiating position. This increased negotiating power is helping to prevent prices from rising at a rapid pace. With more options available, buyers can afford to be more selective, enabling them to negotiate better terms and prices with sellers. This shift in dynamics is likely to create a more balanced market, benefitting buyers who are seeking value for their investments.
Despite the positive signs in the market, some potential buyers are choosing to wait before making an offer. Many are looking for more clarity from the upcoming Budget, as well as the possibility of cheaper mortgage rates. This cautious approach reflects a desire for certainty in a fluctuating market, where financial conditions can significantly impact buying decisions.
The current state of the housing market presents both challenges and opportunities for buyers and sellers alike. While increased competition among sellers is creating a favorable environment for buyers, many individuals are still seeking assurance regarding future financial conditions before committing to a purchase. As the market continues to evolve, it will be interesting to see how these factors influence buyer behaviour in the coming months.
This month, the typical asking price for a home on the market increased by £1,199, or 0.3%, bringing the total to £371,958. This rise is considerably lower than the average seasonal increase of 1.3% that is typically seen during this time of year.
In comparison to last year, asking prices have gone up by 1%. A year ago, the average home was listed at £368,231, meaning it is now around £3,727 more expensive.
London continues to have the highest average asking price among all UK regions. A typical home in the capital is currently valued at £694,906, following a 1.1% increase over the past year.
The South East also sees asking prices well above the national average, with a typical property priced at £483,780. Although prices in this region have declined by 0.6% over the last year, they still remain significantly higher than in other areas of the country.
On the other end of the scale, the North East remains the most affordable region in England, with a typical home valued at £192,742. This figure represents a 4.9% increase compared to the same time last year.
Tim Bannister, a property expert at Rightmove, has highlighted a significant shift in the housing market dynamics, indicating that the current situation is now “in the buyer’s court.” This development suggests that sellers must be more strategic in their pricing if they want to attract potential buyers. With increased competition among properties for sale, it has become essential for sellers to price their homes competitively to stand out in a crowded marketplace.
Bannister added that while there are challenges, such as affordability pressures affecting many prospective movers, the overall outlook for the housing market heading into 2025 remains positive. He noted, “The big picture still looks encouraging for market activity. Despite current affordability challenges, we are witnessing a strong level of engagement in the housing sector.” He expressed hope that once there is more clarity regarding the contents of the upcoming Budget and the potential for quick cuts to the Bank Rate, we could see a surge in market optimism similar to what was experienced last summer.
Currently, the average five-year mortgage rate is recorded at 4.61%, which is a slight increase from the previous week’s rate of 4.55%. Nevertheless, this figure reflects a considerable improvement from the peak average rate of 6.11% observed in July 2023. This downward trend in mortgage rates has the potential to boost buyer confidence, making it a more attractive time for individuals looking to enter the housing market.
In addition, as an increasing number of homes are being placed on the market, the average time it takes for properties to sell has also lengthened. This shift could indicate that buyers are taking more time to consider their options, particularly in a market where they now have more choices. Sellers will need to be patient and realistic in their expectations as this change in market dynamics unfolds. Overall, Bannister’s insights point to a transitional period in the housing market, where adaptability and strategic pricing will be crucial for both buyers and sellers alike.
What it means for you
Rightmove reports that it now takes an average of 61 days to secure a buyer for a property, which is a slight increase from the 59 days observed during the summer months. This change indicates that while buyers remain active, the selling process is taking a bit longer.
Competition among sellers is particularly intense at the higher end of the market. The availability of four-bedroom detached houses and five-bedroom-plus homes has risen by 17% compared to last year, providing buyers with more options in this segment.
Marc von Grundherr, director of Benham and Reeves in London, noted that monthly property transactions have reached their highest levels since 2022. He explained that mortgage approval rates have been steadily improving throughout the year, which is contributing to increased buyer demand that is now translating into actual sales.
This upward trend in the market has also encouraged many sellers to re-enter the market after previously delaying their plans to move. As sellers regain confidence, the overall activity in the housing market is expected to remain robust, benefiting both buyers and sellers alike.
Who else tracks house prices?
Several major banks monitor property prices and publish monthly indices to provide insights into the housing market.
Halifax, which is part of Lloyds Banking Group— the largest mortgage lender in the UK— has been tracking house prices since 1983. It publishes a monthly house price index based on the mortgage data it collects.
Similarly, Nationwide also releases a monthly index that tracks the average price of homes for which it provides mortgages.
It’s important to note that these indices are based on mortgage approvals, so they do not account for cash buyers who purchase properties without needing a mortgage.
The official measure of house prices comes from the Office for National Statistics (ONS), which utilises data from the Land Registry that records actual sale prices.
While these figures are considered the most accurate among various indices, they are published with a three-month delay after homes are sold, resulting in a significant time lag.
Online property platforms Rightmove and Zoopla also provide monthly house price data. Rightmove’s information is derived from asking prices of properties listed on its site, whereas Zoopla uses a combination of sold prices, mortgage valuations, and data on agreed sales.
However, unlike the ONS, neither platform reports the final sale prices of properties. This means some homes may sell for higher or lower amounts than listed, and some may not sell at all.
Here’s the latest data from various property price indexes:
Nationwide: House prices increased by 0.7% in September and are up 3.2% annually, bringing the average property value to £266,094.
ONS: Property prices rose by 2.8% annually, with the average home valued at £293,000 for the year ending in August.
Zoopla: House prices grew by 0.7% in the year to August, resulting in a typical property value of £267,000.