Average asking prices fell by 0.4% in July

Average new seller asking prices drop by 0.4% (-£1,617) this month to £373,493, a bigger July drop than usual, as new sellers try to cut through the distractions of the General Election, sporting events and summer holiday season with a tempting price.

Market activity has remained steady throughout the General Election campaign, and though there are signs that some would-be movers are waiting for the first Bank of England Base Rate cut, most are continuing with their moving plans.

The number of sales being agreed remains encouraging at 15% above the same period a year ago, when mortgage rates were approaching their peak.

The number of new sellers coming to market is a steady 3% above last year.

Buyer demand remains stable overall, but there’s a slight drop (-2%) in demand in the particularly affordability-stretched first-time buyer sector.

Rightmove’s Tim Bannister says: “Three major uncertainties hanging over the property market at the start of the year were when the first interest rate cut would be, and the timing and the result of the General Election. We’ve now got the political certainty of a new government with a large majority, which we expect will help home-mover confidence.

“It’s very early days, but the new Chancellor’s immediate announcements on housebuilding targets and planning reform are positive signs that the government is keen to get going with its manifesto pledges. With many areas of the market that could be improved, we hope that the new government is able to get on with its plans and deliver sustainable housing policies that help the market in the medium to longer term.

“One area of the market in need of more support is first-time buyers, many of whom have been stretched to the limit by high mortgage rates, with some also facing higher stamp duty fees when the current thresholds are set to revert in March 2025.”

Bannister added. “A Base Rate cut is expected to lead to lower mortgage rates, which could be the game-changer for some would-be home-movers who are being held back by significantly higher monthly mortgage costs.

“The average five-year fixed rate is still nearly twice as high as it was before the first of 14 consecutive Bank of England rate increases in 2021, with rates staying elevated for much longer than many thought that they would.

“A first Base Rate cut for over four years, together with the new political certainty, could set the scene for a positive Autumn market, with improved affordability and a more confident outlook in the second half of the year.”

Guy Gittins, CEO of Foxtons, said, “As expected, the housing market has stood firm despite the political uncertainty of a looming general election, even though a marginal reduction in asking prices suggests a point of consideration amongst some buyers and sellers. Thankfully, England’s EURO 2024 progress does not seem to have been a similar distraction.

“It’s already abundantly clear that now the political dust has settled, the post-election market is seeing a notable increase in activity in the few short days that have followed.

“It’s now a case of ready, set, go for the nation’s buyers and sellers and we expect market momentum to continue to strengthen over the summer, especially with the prospect of a rates cut due in September which could release even more pent up buyer demand – particularly at the one million pound and above price threshold.”