By Joe Hoppe
The average house price in the U.K. fell 1.9%, or 7,012 pounds ($8,938) in the month to August 12–the biggest fall in asking prices in a month since 2018–according to new data from Rightmove released on Monday.
The average price of property coming to the market fell on month to GBP364,895, outpacing the usual summer slowdown of a drop of 0.9% for the month, the online property portal said. On an annual basis, house prices fell 0.1%, swinging from growth of 0.5% in July.
This bigger-than-average dip indicates some sellers are taking the initiative to price competitively, and tempt buyers that might be more preoccupied with holidays, inflation and the highest interest rates since 2008, Rightmove said.
“While a 1.9% drop in just one month seems dramatic, it’s in part an expected seasonal drop as sellers coming to market realise that they have to compromise on price due to the traditionally quieter summer holiday period,” Rightmove property-science director Tim Bannister said.
First-time buyer asking prices slipped 0.9% on month to GBP223,614, and were down 0.2% on year. Second-stepper prices fell 0.8% on month to GBP338,137, while top-of-the-ladder homes fell furthest, slipping 3.4% to GBP664,756.
Agreed sales were 15% behind levels seen in the more normal, prepandemic year of 2019, worse than the month before which was 12% below 2019’s figure. First-time buyer demand, however, is holding up better and is down just 10% compared with 2019, partly due to record rents and scarce rental properties.
“The lower level of agreed sales compared to this time in 2019 indicates the affordability challenges that many buyers currently face. However, with sales holding up more strongly in the typical first-time buyer sector, the prospect [of] owning your own home remains an appealing option for those that can afford it, with the alternative being an extremely frenzied rental market, where rents are at record levels,” Bannister said.
The portal measured 123,692 prices across the U.K. over the period of July 9 to Aug. 12.
Write to Joe Hoppe at joseph.hoppe@wsj.com