Rightmove reports largest June UK house price drop in 14 years

Rightmove called the sudden decline ‘unusual’

Property website Rightmove has revealed that last month recorded the sharpest decline in average house prices for any June in the past 14 years. The typical asking price for a home dropped by 0.6%, equivalent to £2,113, throughout June.

This month-on-month decrease brought the average asking price across Britain down to £376,191, according to Rightmove. The property platform noted that June ordinarily delivers modest price rises, suggesting that May’s unseasonably warm weather may have triggered the customary summer slowdown earlier than expected this year, while the World Cup could also be proving a distraction for prospective home buyers.

Rightmove further highlighted that more affordable regions of Britain, including the North East of England and Scotland, are experiencing relatively stable prices compared with the same period last year. Colleen Babcock, property expert at Rightmove, said: “It’s unusual to see a price fall of this size in June, as we would normally expect to see modest price growth at this point in the year.

“What’s different this time is a combination of factors, including wider economic uncertainty, the timing of the May bank holiday and unusual heatwave, and the high number of homes on the market, which together appear to be bringing forward the traditionally slower summer market.

“In this kind of market, sellers need to work harder to attract attention. Setting a competitive asking price from the outset is key, as buyers are taking more time to compare options and are quick to move on if a home doesn’t stand out on value.”

Rightmove noted that elevated mortgage rates continue to dampen market activity as household finances remain under pressure, while the increased availability of properties is prompting buyers to adopt a more measured approach unless a home particularly catches their eye. Ms Babcock added: “While the summer market has come a bit early this year, overall activity is still within a typical historic range.

“What has changed is some buyer behaviour; with more homes to choose from and higher borrowing costs, buyers are deliberating more and taking longer over their decisions.”

Matt Smith, a mortgage expert at Rightmove, said: “It’s encouraging to see mortgage rates edging down slightly, and even relatively small reductions can make a difference to buyers’ budgets.”

Marc von Grundherr, director of Benham and Reeves, London, said: “Buyers aren’t moving at the pace we’ve seen in previous years, largely because current market conditions and an oversupply of stock are affording them the luxury of both time and choice.”

Henry Crane, a partner at James Laurence Estate Agents, Birmingham, said: “Overall, while demand remains, it is highly price-sensitive and selective, with the best-positioned homes continuing to perform strongly.”

Matthew Harvey, a partner at Tayler and Fletcher, Cotswolds, said: “Demand in the higher middle market remains steady, led by lifestyle and schooling needs. At the top end, price adjustments are largely a correction of earlier overpricing following the post-Covid surge.

“Overall, realistically-priced homes are selling well, with many recent listings already finding buyers.”

The report coincided with the release of a separate index from property firm Hamptons, which revealed that the average price of a newly agreed let across Britain climbed 1.1% in the year to May, easing back from a 1.2% annual rise recorded in April. Hamptons confirmed that tenants relocating to a new property in Britain were paying an average of £1,382 per month in May.

On a regional basis, average new let rents in the South East of England reached £1,500 per month in May, representing a 2.0% annual increase. Hamptons noted this marks the first occasion it has recorded any region outside London surpassing the £1,500-per-month threshold.

Aneisha Beveridge, head of research at Hamptons, said: “While rental growth on newly agreed lets remains cool by recent standards, landlords appear to be taking a more cautious approach when selecting new tenants. Many are showing a willingness to wait for the right tenant rather than accept the first offer, which has reduced the number of homes let and helped to keep a lid on rental growth for new tenants.”

Hamptons’ monthly lettings index, which has been in operation since 2011, draws upon data from the Connells Group to monitor fluctuations in rental costs. Crucially, the index reflects achieved rents rather than advertised asking prices.