Asking prices for UK houses fall as rents climb

Average asking prices for UK homes listed by new sellers fell by £7,012 to £364,895 this month, or about 1.9%, according to fresh data from online real estate portal Rightmove (RMV.L).

This was coupled with a falling number of agreed sales, which were 15% lower than levels seen in 2019.

Meanwhile, the data showed that rents continue to creep up, meaning it is becoming more attractive for first-time buyers to enter the market. The number of first-time buyers was above the average — sitting at 10% lower than levels seen in 2019.

In the typical first-time buyer sector of two-bedroom and fewer properties, average advertised rents are up by 12% compared to last year and by 33% compared with the same time in 2019.

Data from the Office for National Statistic echoed Rightmove's findings. It revealed earlier this week that in the 12 months to June house prices in London fell 0.6%, while rents in the capital were up 5.5%.

Annual private rental prices increased by 5.2% in England, 6.5% in Wales, and 5.7% in Scotland in the 12 months to July, it said.

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"A key factor preventing more significant price falls so far this year is that the number of available properties for sale remains historically constrained and is currently 10% lower than in 2019," said Tim Bannister, Rightmove’s director of property science for sellers.

"Rightmove’s latest data backs up reports from agents that pricing right in the current market is key to attracting a buyer."

Although it seems to be slightly more affordable to both buy a house and take out a mortgage, with average rates dipping from 6.08% to 5.81%, it's important to note that prices are still £59,000 (19%) higher than in the pre-pandemic market of August 2019, the data shows.

Watch: UK house prices fall at fastest annual rate in 14 years