Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Strategy. Read the original article for full details.

Sellers Advised to Set Realistic Prices Amid Slower UK Property Market

UK house sellers are being encouraged to price their properties competitively ahead of an anticipated autumn recovery, following a sharper-than-usual summer slowdown in the housing market. The latest House Price Index from Zoopla reports that annual house price growth has eased to 1.3%, down from 1.7% a year ago, with sales agreed over the past four weeks 9% lower than the same period in 2023.

Elevated mortgage rates and ongoing political uncertainty have contributed to weaker buyer confidence and reduced activity across most of the country. Despite this, Zoopla states that the average UK home has increased in value by £3,400 over the past year, bringing the average property price to £272,800. Regional performance varies, with the North West seeing the strongest cash gains—average values rising by £7,100—while London experienced a fall in average prices by £3,270.

The North East stands out as the only region where sales agreed are up 4% year-on-year, which Zoopla attributes to the area's relatively affordable house prices helping to shield buyers from higher mortgage costs. Buyers are also benefiting from a greater choice of properties, as the number of homes for sale has increased across eight of the UK’s eleven regions. This larger supply has strengthened buyers’ negotiating positions and contributed to the slowing pace of house price growth.

Mortgage rates remain a significant challenge for prospective buyers. Average rates dropped from nearly 5% in April to around 4.65% in June, before rising again to approximately 4.75% in July. Since the start of the year, higher borrowing costs have added an estimated £125 a month to repayments on a typical mortgage.

Zoopla identified Warrington, Hull, and Dundee as hotspots, with stronger sales activity and faster house price growth. In contrast, Bath, Oxford, and Harrow have seen weaker markets, with fewer sales and flat or falling prices.

Looking ahead, Zoopla expects market activity to improve in September, a period that has historically seen a seasonal uplift in agreed sales as sellers adjust asking prices to meet buyer expectations. The company advises homeowners hoping to move this autumn to ensure their properties are priced realistically now, noting that any market rebound will depend on mortgage rates remaining stable.