House prices dip, driven by London and the South – Rightmove

The average cost of a home in Great Britain has dipped below last year’s levels for the first time since January, primarily due to a slowdown in southern regions, Rightmove says.

Despite a modest monthly gain of 0.4% in September, which brought the typical new seller’s asking price to £370,257, the national market is now 0.1% cheaper than 12 months ago.

This annual price drop is down to muted growth over the summer, with London and the South of England lagging behind the rest of the country.

A clear regional divide is now appearing as the number of homes available for sale in the south has grown by 9% compared to 2024, versus just a 2% rise elsewhere.

That increase means it now takes an average of five more days to secure a buyer in the southern regions.

September’s house price rise

The platform’s property expert, Colleen Babcock, said: “We’d expect to see a slight uptick in new seller asking prices in September, with the traditional back to school season boosting activity heading into autumn.

“This year’s 0.4% September price rise is a little lower than the norm, which is an average of 0.6% at this time of year.

“However, prices have now dipped slightly from where they were at this time last year after a summer of competitive pricing by sellers, and it’s the south of England which is driving this small dip.”

She added: “It’s the sensible and attractive seller pricing we’ve been reporting which has been helping to drive more sales activity compared to last year.”

House prices in the South West have fallen by 1.3% annually, while in the North West prices grew by 3.2%.

Improved borrowing costs are helping to sustain buyer interest and since August last year, when the first Bank Rate reduction occurred, the average two-year fixed mortgage rate has fallen from 5.03% to 4.52%.

That is saving the typical buyer just under £100 per month on repayments.

Buyers wary of tax rises

Rightmove also says the number of sales being agreed upon is 4% ahead of this time last year, with a 3% year-on-year increase in the south.

The rest of Great Britain saw a more robust 5% uplift.

Adding to market unease is growing speculation about new property taxes in the Autumn Budget.

Data shows no immediate change in home-mover behaviour, but jitters over potential changes to stamp duty or a new ‘mansion tax’ could further dampen activity in areas that are already underperforming.

In London, 59% of property sales completed this year have been for more than £500,000, a threshold that would be subject to the rumoured new levy.

This compares to an average of just 22% of transactions outside the capital.

Ms Babcock said: “Rumours of property tax changes began swirling in mid-August, and with the Budget itself not arriving until the end of November, this kind of extended uncertainty can affect market activity, especially in the higher price brackets.

“Movers want to be confident in planning their moving costs.

“Our real-time data has not yet picked up any major shifts, however, it’s understandable that those who could be negatively affected by the rumoured changes might be in the process of reassessing their short- and medium-term plans.”

Property sector reaction

Jeremy Leaf, a north London estate agent and a former RICS residential chairman, said: “Rightmove, though a historically accurate identifier of market trends and enjoying 90%-plus agent coverage, only tracks asking prices.

“Asking prices are not achieved values but often owners’ or agents’ aspirational starting points and will determine if genuine buyers are attracted.

“In our offices, prices may still be rising marginally in more affordable areas but are softening elsewhere.

“We are still agreeing sales, but the amount of choice and some unrealistic vendor ambitions are compromising activity.”

Mary-Lou Press, the president of NAEA Propertymark (National Association of Estate Agents), said: “Recent Stamp Duty threshold changes and concern regarding the forthcoming budget have added fuel to the fire when it comes to the confidence of potential home movers.

“As mortgage products start to improve and provide light at the end of the tunnel for many, people might now be faced with additional tax to pay when purchasing, potentially adding further pressure on finances.

“House price growth is a sign of wider economic health; therefore, without clear support for people to step onto or move up and down the housing ladder, there’s a concern that this might stagnate the wider property market and prove a setback regarding restoring financial stability.”