Advertisement
UK property markets are experiencing a subtle slowdown, with asking prices for homes falling slightly year-on-year for the first time since early last year. Southern England, where homes are more expensive, has driven much of the decline, though lower prices are helping sales. Rent growth has slowed to its lowest level in four years, with average monthly rents at 1,300 pounds (USD 1,761). Analysts attribute the slowdown to property tax uncertainty, reduced migration, and easier mortgage access for first-time buyers. Economic stagnation and stable interest rates are contributing to cautious activity in both buying and renting sectors.
Asking prices for homes put up for sale in the UK have seen a small annual decline, marking the first drop since early last year, while rent growth has slowed to its lowest rate in four years, according to recent property surveys. Advertisement
Rightmove reported that properties listed between mid-August and early September were 0.1% lower than those marketed a year ago. Month-on-month, asking prices increased by 0.4%, a smaller rise than usual for this period, following three consecutive months of declines. Other indicators of the housing market, including reduced buyer activity and slower price growth, suggest that demand is moderating.
Colleen Babcock, a property expert at Rightmove, noted that speculation about changes to property taxes began circulating in mid-August. She explained that with the annual Budget scheduled for late November, this kind of prolonged uncertainty can influence market activity, particularly for higher-priced homes. The year-on-year decline in house prices was mainly driven by properties in southern England, which tend to be more expensive and sensitive to potential tax increases. However, lower prices in this region have helped stimulate sales. The upcoming Budget may introduce higher taxes, but it is not yet clear where the main burden will fall.
On the rental side, Zoopla reported that average rents were 2.4% higher than a year ago, the slowest annual increase in four years, with average monthly rents at 1,300 pounds (USD 1,761). While affordability continues to be a concern, the number of rental homes on the market has increased, easing competition. Zoopla expects rents to rise by around 3% by the end of the year. Richard Donnell, executive director at Zoopla, noted that lower migration and better mortgage availability for first-time buyers are helping to ease the pressure on rental demand.
The broader economy also shows signs of slowdown. Official data indicated that the UK economy failed to grow in July after a 0.4% expansion in June. The Bank of England is expected to maintain interest rates at 4%, while financial markets anticipate a potential quarter-point rate cut in spring 2026.
Source- Reuters
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
