UK for sale prices have remained flat in June as some sellers have adopted a wait-and-see approach amid the general election campaign, the latest Rightmove House Price Index (HPI has found.
Following a month in which house prices listed on the site climbed to a record high, there was a small £21 decline over the four weeks to 8 June. The average asking price is now £375,110 - 0.6% higher than it was in the same month in 2023.
The property listing website found that the top-end of the market registered a slight fall of 0.6% (£4,000) month-on-month to an average asking price of £689,810. It said this end of the market had seen a slight drop in the number of new sellers, which may have come as a result of the general election. However, other parts of the market appear to be working as normal, with the overall number of agreed sales up 6% and new buyer enquiries 5% higher compared to a year ago.
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It comes as the major parties have begun to set out their stall to prospective buyers and homeowners. The Conservatives have said they would make the existing stamp duty cut permanent, if they get elected. Meanwhile, the Labour Party has pledged to extend the mortgage guarantee scheme with its Freedom to Buy commitment. We have also seen manifestos from the Liberal Democrats and the Green Party.
While Rightmove’s asking price data has shown that market sentiment remains relatively positive, other HPIs have suggested that house prices are struggling to grow. Lenders Halifax and Nationwide have both found that high mortgage rates have kept the market in check, with interest rate falls unlikely to be seen until the first Bank of England base rate cut.
Rightmove: asking prices ‘rising highest’ in cheaper regions
A north-south divide has emerged in every HPI so far - and Rightmove’s latest property market research has suggested that this trend is continuing. Prices tended to be up month-on-month in cheaper northern areas - but slid back in most southern parts of the UK.
The biggest monthly growth was recorded in the North East, where average property values rose 1% (1.9% year-on-year). Not far behind was the North West, where prices grew 0.9% (1.8% compared to June 2023). While asking prices remained flat month-on-month, the biggest yearly rise was seen in Yorkshire and the Humber where they went up 2.8%.
At the other end of the scale, the East of England registered a 0.5% fall, meaning properties are being marketed at 1.4% less than they were a year ago. London was the next worst performer, with prices falling 0.3% month-on-month. However, the capital has seen annual growth of 1.4%.
This year-on-year growth has mostly been led by rocketing house prices in the boroughs of Camden (+9.7%), Merton (+6%) and Hammersmith and Fulham (+5.3%). Areas that were a check on these increases included Brent (-2.9%), Hackney (-2.7%) and Kingston upon Thames (-2.6%).
On a national basis, it took an average of 60 days for homes to secure a buyer - the shortest amount of time since September 2023. The average level of stock per estate agency also hit a record high of 59.
Rightmove’s director of property science, Tim Bannister, said “improved market activity levels and conditions” should mean the number of transactions in 2024 exceeds the number in 2023. But he warned that the “extremely lengthy” completion process was creating a “frustrating barrier” for those seeking to move.
He said: “It may seem surreal to be thinking about Christmas in May, but we know that many would-be sellers picture celebrating the festivities in a new home, and to achieve that, now is the time to be coming to market. One strategy that is still giving some sellers the edge in this price-sensitive market, is working closely with an estate agent to price attractively right at the start of marketing, to give themselves the best chance of finding a buyer quickly.”
Market activity ‘stable’ despite general election
The website’s latest HPI also showed that the majority of the market has been unaffected by the general election campaign. It found that the number of agreed sales and buyer enquiries has remained on a par with what’s been seen so far in 2024.
Rightmove did register “possible election caution” among would-be sellers at the top of the market. It said some appeared to be putting their plans on ice to see how the campaign unfolds.
Over the last two weeks, it said the overall number of new sellers coming to the market had been just 1% up year-on-year, having been 6% higher compared to 2023 over the previous two weeks. At the top end of the market - i.e. homes with five-or-more bedrooms, or four-bed detached houses - the number of new sellers over the last fortnight was 3% down against the year, having been 11% up over the previous two weeks.
Bannister said of the figures: “It’s always difficult to predict how home-movers will react to sudden uncertainty. But looking back through our data, we can see that during previous election campaigns, market activity has remained largely steady. This election has followed a similar pattern so far, and the responses from our poll of over 14,000 people also supports the data, with the vast majority of respondents saying they will carry on with their home-moving plans.
“However, some potential sellers appear to be watching and waiting rather than taking action, evidenced by a dip in the number of new sellers coming to market, particularly at the top-end. This is understandable when many of these sellers have more flexibility over when they act, but overall, it appears to be business as usual for the mass-market.”
In terms of the housing pledges aired so far on the election campaign trail, Bannister said they were mostly “continuations of existing schemes, revivals of old policies, or ideas which are only likely to help very specific parts of the market”. He added that the major parties could go further to support the housing market, including by getting more first-time buyers onto the market.
But he also said that Bank of England rate cuts were now “likely to be of greater concern” than manifesto commitments: “Mortgage rates remain stubbornly elevated, with the current average five-year fixed rate now at 5.04%. While this has improved from the peak of 6.11% in July 2023, it is still higher than the beginning of the year when it was 4.94%.
“At the start of 2024, many will have been expecting, or at least hoping, to see some significant falls in mortgage rates by the halfway point of the year. If a Bank of England base rate cut can lead to lower mortgage rates, it will have a much wider and immediate impact on the market than the bespoke housing policies announced so far.”
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