One in ten UK homes registered a cut to asking price in July, well above the five-year average. This surge in price reductions signals a decisive shift towards a buyer's market as sellers adjust to changing conditions.
Average house prices rose by just 1.3 per cent in the year to July, down from 2.1 per cent growth recorded at the start of 2025. The average house price now stands at £270,600, representing a £3,560 increase year-on-year.
Buyer's market emerges
Buyers now have significantly greater choice, with 10 per cent more homes on the market compared to the same period last year. This increased supply is particularly evident across southern England, creating competitive pressure on sellers.
"There is plenty of demand for homes and more people are looking to move… [but] buyers also have much greater choice to choose from, especially across areas of southern England," Richard Donnell, executive director at Zoopla, said. "There is a clear link between buyer choice and price inflation and how long it is taking homes to sell."
According to Daily Mail analysis, homes requiring price cuts take 2.4 times longer to sell than those with no price reduction. This stark difference highlights the importance of realistic initial pricing in the current market.
Regional divide deepens
Northern regions have seen an average time to sell of 27 days in July, versus 39 days in the south. This regional disparity reflects varying levels of affordability constraints and buyer demand across different areas.
Reports from Independent and Daily Mail suggest a quarter of homes in coastal areas like Truro, Exeter, and Bournemouth have remained unsold for six months or longer. These prolonged selling periods particularly affect higher-value properties in traditionally sought-after locations.
"In a buyer's market, where fewer buyers are looking to take the plunge, sensitively-priced homes will usually sell quicker, as sellers compete," Tomer Aboody, director of specialist lender MT Finance, said.
Property tax speculation creates uncertainty
Rumours about potential property tax changes are adding uncertainty to market conditions. The Treasury is reportedly considering a property tax on homes over £500,000 and capital gains tax on sales over £1.5 million as part of efforts to address a £40 billion budget gap.
According to Guardian analysis, a third of homes currently for sale are priced above £500,000, with London and the South East most affected by potential tax changes. This concentration means any tax reforms could have disproportionate regional impacts.
"Unfortunately perhaps the government do not appreciate that even rumours of a new property tax can have a detrimental impact on housing market confidence and activity which we certainly witnessed 'on the ground' since the story broke last week," Jeremy Leaf, north London estate agent and former RICS chairman, said.
Market outlook remains cautious
Zoopla expects UK house price inflation to continue in a range of 1.5-2 per cent over the rest of the year. Signs suggest prices are firming in southern England but slowing across northern regions.
"Since we have possibly seen the final base rate cut of the year, buyers may need to get used to the new 'norm' for mortgage rates for the foreseeable future," Aboody added. This mortgage rate environment continues to constrain buying power, particularly in higher-value markets.
Nathan Emerson, CEO of Propertymark, said: "Stable house prices within the housing market are a welcome sign for groups such as first-time buyers, who can better take advantage of a period of steadiness."
Sources used: "Zoopla", "Daily Mail", "Independent", "Guardian", "City A.M" Note: This article has been edited with the help of Artificial Intelligence.
