Asking prices for homes coming onto the UK property market increased in September for the first time since May, according to property website Rightmove, pointing to a tentative
improvement in seller confidence after a subdued summer.
The average asking price of newly listed properties rose by 0.7% between August 9 and September 12. The increase was slightly stronger than is typical for this period of the year and followed a 2.0% decline recorded over the previous four weeks.
Despite the monthly recovery, prices remained below their level a year earlier. Rightmove reported that average asking prices were 0.8% lower year-on-year, although this represented an improvement from the 1.0% annual decline recorded in its August report.
The market is also seeing a significant increase in the supply of homes. The number of properties available for sale has reached its highest level in 12 years, giving prospective buyers a wider choice.
However, demand remains relatively weak. Buyer enquiries were 9% below the level recorded at the same point last year, suggesting that higher borrowing costs and economic uncertainty continue to weigh on activity.
“September’s above-average price rise is a welcome sign of confidence after a particularly subdued summer, but it should be viewed as a modest recovery,” Rightmove property expert Colleen Babcock said.
Mortgage costs remain an important constraint on the market. The average interest rate for a two-year fixed-rate mortgage increased to 5.29%, up from 5.09%.
Rightmove said borrowing conditions were also being affected by wider geopolitical uncertainty, with the continuing conflict involving Iran contributing to pressure on financing costs.
The combination of elevated mortgage rates, high housing supply and subdued buyer enquiries means that the September increase in asking prices does not yet signal a broad-based recovery in the UK housing market.
