As Britain’s housing market enters the second half of the year under mounting pressure, asking prices for newly listed homes have suffered their steepest August decline in eight years, with
an unusually large supply of properties and elevated borrowing costs weighing on sellers.
Average asking prices fell by 2.0% in the four weeks to 8 August, according to Rightmove, significantly exceeding the typical 1.3% decline recorded over the past decade. The drop represents the largest August fall since 2018 and underlines the increasingly difficult conditions facing the market.
Prices were also 1.0% below their level a year earlier — the sharpest annual decline since December 2023.
The figures point to a housing market struggling to regain momentum despite a modest improvement in buyer activity following Andy Burnham’s arrival as prime minister on 20 July. Buyer demand has risen by 5% since then, but remains 10% below the level recorded at the same point last year.
The summer slowdown has been compounded by a 12-year high in the number of homes available for sale. With buyers enjoying greater choice, sellers are facing stronger pressure to price competitively if they want to secure a deal.
London remains the weakest part of the market. Asking prices in the capital were down 3.1% year-on-year, while several areas in the north of England recorded price growth, highlighting a widening regional divide in the performance of the UK property market.
Mortgage costs are adding to the strain. The average rate for a two-year fixed mortgage climbed to 5.09%, up from 4.92% a month earlier, increasing the financial burden on prospective buyers and limiting the scope for further price gains.
Rightmove has responded by cutting its forecast for UK house-price growth in 2026 to 2%. It now expects prices to be flat or potentially fall by as much as 2%, citing geopolitical uncertainty, higher mortgage rates and the prospect of further measures in October’s Budget as key risks.
The latest figures are based on properties put on the market between 12 July and 8 August and provide an early indication that the traditionally quieter summer period could prove more challenging than usual this year.
For sellers, the message is increasingly clear: an abundance of choice for buyers, combined with expensive mortgages and economic uncertainty, is making the UK housing market a far tougher environment than it was at the start of the year.
