The average asking price for homes coming to market has dropped by 1.3% this month, equal to £4,969, bringing the national average to £368,740.
The decline is in line with the ten-year seasonal trend, following larger than usual price falls in June and July.
Lower asking prices and increased choice for buyers have boosted sales activity, with the number of sales agreed in July reaching the highest level since 2020’s post-lockdown surge.
The volume of agreed deals is now 8% ahead of the same time last year, while the supply of homes for sale is 10% higher than a year ago, limiting annual price growth to just 0.3%.
Mary-Lou Press, president of NAEA Propertymark, said: “Despite recent changes regarding Stamp Duty, and the fact that there is still so much economic uncertainty, it is extremely positive to witness an uplift in sales being agreed and an increase in properties coming to the market.
“The performance of the property sector is a strong indicator of consumer confidence and it has been reassuring to see base rate cuts across the past few months that have helped to create greater levels of affordability.
“The last base rate cut was decided with a very slim majority by the Monetary Policy Committee of 5-4 in favour of lowering the base rate, clearly demonstrating how cautious the decision was overall.
“With inflation still not down at the initially targeted rate of 2% all eyes will be on the Bank of England as the year plays out.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “As is customary at this time of year with so many on holiday, the quantity of our enquiries may have dropped but the quality has improved.
“Serious buyers are taking advantage of the extra choice and their burgeoning bargaining power.
“On the ground, realistic sellers too are not fixated with achieving the maximum price possible but concentrating on the difference between what they receive and what they have to pay for their next home.
“As a result, some values are softening but not dropping significantly. Looking forward, those returning holidaymakers may be in for a shock when they see that property which could have been bought at a considerable discount a few months ago is now under offer – and at a better-than-expected price.”
Rightmove data shows that pricing strategy is a key differentiator. Homes that are priced correctly from the outset take an average of 32 days to find a buyer, compared with 99 days for properties that require a reduction.
More than one in three homes currently listed have seen a price cut, the highest proportion at this point in the year since 2023.
Meanwhile, falling mortgage rates are providing further support. Rightmove’s tracker shows that the average two-year fixed mortgage rate is now 4.49%, compared with 5.17% in August 2024, following the Bank of England’s third rate cut of the year.
However, the narrow margin of the most recent vote leaves uncertainty over whether another cut will follow before year-end.
