UK Housing Market Sees Sharpest Drop in Asking Prices since 2018!

The UK’s housing market, which witnessed a remarkable surge during the Covid-19 pandemic, is now exhibiting signs of moderation. Recent data from property portal Rightmove reveals a notable decline in asking prices for homes during August, the sharpest since 2018. After a string of four consecutive months marked by decreasing house prices, this shift hints at a broader slowdown in the property sector. This article delves into the details of this trend, exploring the factors at play and their potential implications.

In the span of five weeks leading up to August 12, new home sellers entered the market with an average asking price of £364,895. This figure reflects a substantial decrease of £7,012 compared to the previous month. Importantly, this drop represents the most significant August decline since the onset of the Covid-19 pandemic. The surge in the UK’s housing market, which was a distinctive feature of pandemic times, has eased as the Bank of England has undertaken a series of interest rate hikes to address mounting inflation.

While the trajectory of house prices has shifted, there have been nuances in the financial landscape that demand attention. Notably, there was a recent moderation in two-year mortgage rates, which had reached a peak in July – the highest in a decade and a half. This indicates a degree of flexibility in the market dynamics and a potential to alleviate some of the financial burden on potential homebuyers.

Predictions and Observations:

Market analysts are cautiously anticipating that the trend of declining house prices will persist throughout the year. Halifax, a prominent lender, reported a marginal 0.3 percent decrease in average house prices from June to July. This marked the fourth consecutive month of price decline according to Halifax’s data. Nevertheless, despite the dip in asking prices as documented by Rightmove, the average house prices remain considerably higher – nearly 20 percent – compared to the pre-pandemic levels observed four years ago.

Buyer affordability has received a boost from both lower asking prices initiated by sellers and a downward trajectory in mortgage rates. The average five-year fixed mortgage rate has experienced a recent reduction, dropping from 6.08 percent to 5.81 percent in just three weeks. This trend, while still tentative, suggests a potential improvement in buyer accessibility to the market.

Insights and Future Prospects:

Tim Bannister, the Director of Property Science at Rightmove, aptly underscores that while the recorded 1.9 percent decrease in just one month might seem substantial, it is in part a seasonal norm. Sellers entering the market during the traditionally quieter summer holiday period often find themselves needing to adjust prices. The fact that the decline wasn’t steeper can be attributed to the limited inventory of properties for sale, a constraint that has persisted historically and is presently 10 percent lower than levels seen in 2019, as unveiled by Rightmove’s findings.

The comprehensive Rightmove House Price Index also highlights a 15 percent drop in the number of sales being finalized compared to the same time in 2019, before the pandemic unfolded. This might indicate a more cautious approach from buyers, potentially driven by the ongoing uncertainty in the financial and economic landscape.


The UK’s property market is experiencing a notable shift in its dynamics. The significant decline in asking prices for homes during August, the most pronounced since 2018, signifies a broader trend of moderation in the housing sector. Amidst the backdrop of the Bank of England’s interest rate hikes to curb inflation, the market is recalibrating after a period of pandemic-induced exuberance. As the year unfolds, analysts and market participants will closely monitor the trajectory of house prices, mortgage rates, and buyer behavior, seeking insights into the future of the UK’s property landscape.

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