June House Price Index

House prices drop in June as sellers seek to attract summer buyers

 

The average price of newly-listed homes for sale has fallen by 0.6% (-£2,113) this month to £376,191. This is the biggest June price drop in fourteen years, as sellers seek to attract summer buyers, leaving prices 0.5% below a year ago.

 

June typically sees a small price increase, so this month’s drop suggests that many new sellers are adjusting prices in response to the record number of homes available for this time of year, and buyers being sensitive to pricing levels. Summer is typically slower than the spring, with more buyers distracted by sporting events, holidays and better weather, and therefore needing to be tempted by sellers with an attractive price.

 

In a market where choice is high and buyers are more selective, it’s increasingly important to price a property correctly from the start of the sales process. Over a third of new listings that come to market are not going on to sell.

 

However, as we saw last month, national price trends don’t always reflect regional and local market differences. Prices have fallen across all southern England regions and Wales, while the more affordable northern areas such as the North East and Scotland are holding up better compared to this time last year.

 

Sales activity remains steady

 

May’s unusual heatwave kick-started summer earlier than usual this year, and the World Cup may prove to be a summer distraction for home-movers. In addition, economic challenges and global uncertainty continue.

 

Demand from buyers in May was down 10% compared to last year, but is still largely in line with what we’ve seen so far this year. Higher mortgage rates are continuing to affect activity, while the wider choice of homes for sale is encouraging buyers to take a less urgent approach unless a property really stands out on its price or presentation.

 

Despite these challenges, sales activity remains steady overall. The number of sales agreed are down 6% compared with last year, but are broadly in line with recent years, almost the same as 2024 and 5% above 2023.

 

What are mortgage rates doing?

 

Rightmove’s daily mortgage tracker shows that the average two-year fixed rate has dropped to 5.07% from 5.18% last month. This reduces the average monthly mortgage payment by around £30.

 

“It’s encouraging to see mortgage rates edging down slightly, and even relatively small reductions can make a difference to buyers’ budgets,” explains Rightmove’s mortgages expert Matt Smith. “While rates remain higher than the lows of recent years, they have been relatively stable over a sustained period, which is helping to provide more certainty for those planning a move.

 

“There is still some underlying volatility in the economic and global market, which means rates could move slightly in either direction from here. However, the key takeaway for buyers is that we’re currently in a period of greater stability than we’ve seen previously, and that stability can help support confidence, particularly for those who are close to affordability limits and weighing up their next step.”

 

The numbers at a glance