Surge in choice for home buyers drags house price growth down to 1.4 per cent
Zoopla cautions serious sellers to price realistically to secure a sale
-
Sales activity continues to run at the fastest rate for four years, with more homes for sale meaning more buyers looking to secure a sale
-
However, UK house price growth slows to 1.4 per cent as the number of homes for increases 14 per cent boosting buyer choice and limiting price growth
-
Affordability is also a drag on prices growth in higher priced markets – there are modest house price falls (-0.2 per cent) in markets with values of over £500,000
-
House price growth is higher (2.7 per cent) in markets below £200,000 – at a local level prices are rising by over 3.5 per cent in Wigan, Falkirk and Blackburn
-
The average time to sell is 45 days, although over one in five (22 per cent) homes has been on the market for over six months without achieving a sale
-
Zoopla urges serious sellers to seek advice to price their home correctly in order to achieve a timely sale
UK house price growth is being dragged lower as buyers have a growing choice of homes for sale. This is according to Zoopla’s latest House Price Index. UK house price inflation has slowed to 1.4 per cent, down from two per cent earlier this year with home values falling in parts of London and southern England. The average UK house price is £268,400, which is £3,960 higher than a year ago.
House price growth weakest where number of homes for sale has grown the most
More and more people are listing their home for sale with a view to finding a buyer and moving home in the next year. The average estate agent has 37 homes for sale, compared to 32 last year. More sellers means more buyers, which is supporting a 6 per cent increase in sales agreed compared to a year ago2.
The growth in the number of homes for sale over the last year varies across the country. There is a clear link between house price growth and the change in the number of homes for sale over the last year, with lower price growth in markets which have seen the greatest increase in homes for sale. This boosts choice, re-enforcing the buyers market.
In London, the South East and South West regions of England the number of homes for sale is 16-19 per cent higher than a year ago, while house prices are barely rising, with under 0.5 per cent growth over the last year.
In contrast, northern regions, the West Midlands and Scotland have registered a smaller increase in supply, creating an element of scarcity and driving above-average price growth of two to three per cent.
Table 1: House price growth held back where buyers have greatest choice
House price falls persist in higher value markets, while affordable areas see growth
Affordability and the level of house prices are also important factors impacting price growth. The higher the price the greater the income needed to buy. The latest Zoopla House Price Index shows there are modest house price falls (-0.2 per cent) in areas with an average property value of over £500,000.
These markets account for eight per cent of UK homes and are concentrated in pockets in inner London and southern England. Prices are over one per cent lower over the last year in the West Central London (WC, -4.3 per cent) and West London (W, -1.3 per cent) postal areas alongside Torquay (TQ, -1.7 per cent) and Truro (TR, -1.3 per cent) in the South West.
Table 2: House prices falling in higher-value housing markets
In contrast, house prices are 2.7 per cent higher in more affordable markets with average house prices below £200,000, and 1.9 per cent higher in markets priced between £200,000 and £250,000. Together, these markets cover 50 per cent of homes.
House price growth is currently fastest, at over 3.5 per cent per annum, in parts of the North West of England and Scotland, including Wigan (WN, 4.3 per cent), Falkirk (FK, 3.8 per cent) and Blackburn (BB, 3.6 per cent) postal areas.
In addition to affordability factors, tax and policy changes aimed at second homeowners and landlords are leading to weaker demand and more sales by these owners, which is compounding the impact on house price growth at a localised level.
Serious sellers need to price realistically
Sellers need to be realistic on pricing if they are serious about finding a buyer and moving home in 2025. The average time to sell is 45 days3, broadly in line with this time last year. This ranges from 35 days in the North East to 57 days in Wales, while all the southern regions in the UK average over 50 days due to a greater choice of homes for sale.
Over one in five homes (22 per cent)4 currently listed for sale have been on the market for over six months and remain unsold, while just under a quarter (23 per cent) have been on the market for three to six months and are yet to find a buyer. The average time on the market for an unsold home is 75 days.
Many sellers have a price in mind that they want to secure a sale for their home, or a price they need to achieve in order to unlock their next home move. They may eventually get this price, but may have to wait a long time to achieve it. Ultimately, it’s a choice for sellers between prioritising a specific sale price or setting a realistic price and agreeing a sale in a timely manner.
Commenting on the report, Richard Donnell, Executive Director at Zoopla, said
“The number of buyers and sellers agreeing home sales continues to increase year-on-year, demonstrating a continued desire of more households to move home in 2025. Improving mortgage affordability will support buying power in the second half of the year.
“However, buyers remain price-sensitive, especially in higher-value markets where the number of homes for sale has grown the most in the last year, boosting choice for home buyers. Serious sellers need to be realistic on where they set their asking price in order to achieve a sale and secure a home move in 2025.
“The market remains on track for 5 per cent more sales in 2025 but house price inflation will remain between 1 and 2 per cent.”
Sarah Cartlidge, Branch Manager at Fraser Reeves estate agent based in the North West comments:
“We’re delighted to be seeing increased vendor confidence this year, with more properties coming on to the market than 2024, however, property price remains key to agreeing a sale.
“We’re always keen to emphasise to prospective vendors that they do need to price positively and realistically from the get-go, in order to secure a good buyer in good time, and to make the best first impression possible when their property hits the market.
“We know that any property can sell for the right price, taking into account the local competition and the particular characteristics of each individual home.”
You May Also Enjoy
Enhancing Project Presentation with 3D Rendering Services
House prices fall for the first time in 18 months across southern England
Rightmove trialling new Renovation Cost Estimator
Strong rental supply continues amid seasonal slowdown in demand
Why Choose Wooden Blinds for Your Home?
