Housing market activity remains strong, but the muted Autumn price increase of just 0.3% month-on-month to £371,958 comes as buyer choice and seller competition rise.
With a greater choice of properties to consider, buyers are making use of their increased negotiating power, helping to keep price rises subdued, according to Rightmove, which provided the data.
The property portal says this month’s limited price growth is also in part down to some sellers heeding agents’ and caution to price attractively to find a buyer, particularly with seller competition rising, helping to keep activity moving.
Affordability remains stretched, limiting buyers’ purchasing power, but there are encouraging signs of this improving next year.
Buyers’ market as property asking prices rise more slowly than usual – Property Industry Eye
Industry reactions:
Myles Moloney, area sales manager at Chase Buchanan, commeneted: “At the beginning of October we saw continued buyer confidence which was boosted by favourable mortgage rates and a greater number of properties being put up for sale. As we are nearing the Autumn Budget, however, house hunters and sellers have grown more cautious. We predict market activity to pick-up after the Budget, once buyers and sellers feel that a more defined picture of the political and economic environment has been established.”
Tom Bill, head of UK residential research at Knight Frank, said: “Mortgage rates have been falling since the summer but buyers and sellers haven’t necessarily received the memo. The information vacuum ahead of the Budget has kept demand in check as the autumn market gets underway. If the Budget is better than feared, it could kickstart a period of strong trading activity in the housing market as rates look set to fall further over the next 12 months.”
Chris Rowson, managing director of Sharman Quinney, said: “Activity has been strong; we’ve seen a surge of new instructions in September and is one of our busiest months for new sellers in the last decade. We’ve also seen a good jump in new potential buyers, as well as agreed sales in the area, so it’s been busy. The Bank Rate cut and lower mortgage rates definitely played their part in helping more people to come to market. There’s always some uncertainty surrounding the Budget, but we’re not seeing any buyer hesitation due to it. Despite some mortgage interest rates trickling upwards, the changes are small and not of major concern right now.”
Joel Baseley, founder and director of Rampton Baseley, remarked: “We’ve seen one of the best years for number of transactions in our 18-year history and while activity has been exceptional, price growth has been muted. This could be down to the ‘new normal’ of higher interest rates but also a particularly steep increase in values post-pandemic which will need more time to level off. Moving into the new year we were expecting a pre-election pause, but did not expect a second hiatus due to the new government’s much anticipated first budget. However, we’re hoping for a good end to the year once this pause button is released.”
Nathan Emerson, CEO of Propertymark, commented: “Many serious buyers seem to be in the driving seat when it comes to negotiating on their next home move due to the vast choice of properties on the market. Furthermore, with the Bank of England’s next announcement on interest rates looming, some buyers will be cautious with their current budgets or will be waiting in the wings to see what its decision will mean for the market before moving.
“As it stands, we are seeing really competitive mortgage deals enter the market, enabling buyers to find an affordable middle ground to purchase their ideal home. However, we now hope the Bank of England cuts interest rates further as soon as they’re able to in order to further stimulate the market and enable people to move within or step onto the housing ladder for the first time.”
Marc von Grundherr, director of Benham and Reeves, added: “Mortgage approval levels have been strengthening for much of this year and we’re now seeing this increase in buyer demand start to filter through to actual sales, with monthly transactions being the strongest since 2022. This improving market momentum has also helped to tempt many sellers back into the market who had previously put their plans to move on pause.
Of course, there will always be a segment of both buyers and sellers who will sit tight in the hopes of some form of property market boost via the upcoming Autumn Budget. However, we’re not seeing this at ground level so much, largely due to the fact that very little has been leaked with regard to the sales sector.”