The number of homes being sold is up almost a third, year on year, so far this month, although the traditional autumn price bump has failed to emerge due to buyers being spoilt for choice, with the number of properties for sale at a 10-year high, according to Rightmove.
The number of sales agreed is up 29%, with the number of house hunters contacting estate agents up 17%, despite some market uncertainty caused by the looming budget at the end of October.
“Sales activity has not only bounced back from the low of last year but has continued an upward trajectory,” said Tim Bannister, the director of property science at Rightmove. “There is also a healthy level of underlying buyer demand as people continue to plan their next move.”
Rightmove’s latest house price index estimates that the number of homes for sale is 12% higher than a year ago, and is at the highest level per estate agent since 2014. This has provided buyers with more choice and negotiating power, which has meant the average price of a property coming to the market has risen just 0.3% month on month to £371,958, well down on the long-term average of a 1.3% increase in October.
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“We’ve seen one of the best years for numbers of transactions in our 18-year history,” said Joel Baseley, founder and director of the agents Rampton Baseley in London. “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.”
Rightmove said that while the outlook for the market in 2025 remains positive, there is still concern about buyer affordability, with some buyers holding off until mortgage rates drop.
The average five-year fixed mortgage rate is 4.61%, up from 4.55% last week, the first weekly increase since May.
In August, the Bank of England’s monetary policy committee voted to cut the base rate by 0.25% and analysts are expecting another cut when it meets again next month.
Rightmove also said that some buyers may be holding off until there is clarity about what the implications of Labour’s budget on 30 October will be for the housing market.
“Some estate agents report that some movers are now waiting for budget clarity and anticipated cheaper mortgage rates later this year,” said Bannister. “Despite a budget-shaped cloud on the horizon, the big picture still looks positive for the market heading into 2025. Market activity remains strong, but affordability is still the biggest barrier facing many movers.”