Autumn bounce sees home buyer activity pick up

Despite mortgage volatility, buyer activity has bounced back from August into September.

Rightmove’s latest House Price Index reveals that average newly listed asking prices rose by 0.7% (+£2,441) this month to £367,440, the first monthly increase since May.

September’s above-average price rise for this time of year could be an early sign of the usual autumn bounce in market activity, although there is considerable ground to make up following a somewhat subdued and distracted summer.

Buyers have plenty of choice

Despite signs of an autumn bounce, buyer enquiries remain 9% lower than this time last year. Prices are also 0.8% below last year and 2.3% below the start of summer, highlighting the ground still to make up after a subdued few months.

On average, 61% of homes coming to market find a buyer, but success varies significantly by region. Scotland leads at 91%, compared with just 42% in London. In the North West, 71% find a buyer, versus 56% in the South East.

Colleen Babcock, property expert at Rightmove, said: “It’s encouraging to see more buyers returning to the market as we move into Autumn, with activity picking up as usual after a subdued summer. Whilst almost two-thirds of homes are still successfully finding a buyer, the chances of selling vary significantly depending on where you live.

“Over 90% of homes that come to market for sale are selling in Scotland versus less than half in London, meaning those who want to sell will have to set their pricing according to local market conditions.

“Buyers continue to have plenty of choice and mortgage rates are increasing, so competitive pricing is still the biggest factor in attracting interest and securing a sale. Sellers who get the initial asking price right are giving themselves the best chance of standing out in a crowded market.”

Rising mortgage rates

The data also reveals the average two-year fixed mortgage rate is now 5.29%, up from 5.09% last month as rising mortgage rates continue to stretch buyer affordability.

Matt Smith, Rightmove’s mortgage expert, said: “This month’s traditional uplift in buyer activity shows there’s still a strong underlying desire to move, but volatility in mortgage rates remains a significant challenge for many. Mortgage rates have risen again over the past month, adding further pressure to monthly budgets, and the uncertainty over what may happen to rates in the medium term is likely holding back some potential movers.

“There remains a good volume and range of mortgage products available to support borrowers across different deposit sizes, and although rate rises are never a good thing for buyers, they are at least more accustomed to elevated mortgage rates than a few years ago. Understanding your own personal affordability and how far you can stretch is really important in the current market.”