The UK housing market is seeing a shift as estate agents report the highest number of homes on their books in over a decade, helping to stabilise house prices.
Data from Rightmove, the property search website, reveals that branches across Britain are marketing an average of 63 homes, marking a 12% increase from the same time last year and the most since 2014.
During the pandemic’s “race for space,” housing stock was scarce, with agents often having fewer than 40 properties listed at any one time. This shortage, combined with heightened demand and stamp duty holidays, drove house prices to unprecedented levels. Now, however, an increase in available homes is giving buyers more negotiating power and helping to slow price growth.
In October, the average asking price for new listings on Rightmove rose by just 0.3%, to £371,958. This is significantly lower than the usual 1.3% increase typically seen during the busy autumn months when many buyers return to the market after the school holidays.
Tim Bannister, head of property data at Rightmove, commented: “This month’s subdued price growth comes as buyer choice soars to a level not seen since 2014. With the ball in the buyer’s court and a wide selection to choose from, sellers need to price competitively to secure a buyer, especially with affordability still stretched.”
Improving conditions fuel market activity
The growing number of homes for sale is largely driven by falling mortgage rates, which are encouraging potential buyers — many of whom need to sell their current homes — to return to the market. The average five-year fixed mortgage rate has dropped to 4.6%, down from a peak of 6.1% in July 2023, making it more affordable for people to move.
As a result, the number of agreed sales is up 29% compared to this time last year, and estate agents are reporting a 17% increase in inquiries from prospective buyers. This signals a recovery after two years of stagnation, when rapidly rising mortgage rates forced many to delay their plans to buy or move.
Housebuilders have also reported a rise in sales, and estate agents are growing more optimistic about the outlook for the housing market. Rightmove data shows that asking prices have increased by 1% over the past year, with mid-market properties such as three-bedroom homes seeing the largest gains, up by 1.7% year-on-year.
However, at the higher end of the market, prices for larger properties, such as five-bedroom houses and four-bedroom detached homes, have decreased slightly by 0.2%. Bannister noted that some potential buyers at the top of the market are holding off on making a move until they have more clarity about fiscal policy.
Looking ahead: a bright 2025?
Despite the current market uncertainties, Bannister is optimistic about the future, forecasting an “active 2025.” Interest rates are expected to fall further, and wage growth is outpacing house price inflation, improving affordability for many potential buyers.
Bannister anticipates that more certainty following the 30 October budget, along with potential further cuts in bank interest rates, could trigger renewed market optimism, similar to the surge seen during the summer of 2022.
