Average price tag on a home falls as rate cuts spark demand revival
The average price tag on a newly marketed home dropped by over £5,000 in November as buyer demand revived in the wake of the Bank of England’s recent interest rate cut.
According to Rightmove, the standard price for a newly marketed home currently sits at £366,592, a 1.4 per cent month-on-month drop.
That downward trend is steeper than usual, with a typical November fall being around 0.8 per cent.
Rightmove said its data indicated that a fall in buyers approaching estate agents following the Autumn Budget, had been offset by a rise in buyer demand after the Bank of England lowered interest rates to 4.75 per cent in only the second cut this year.
In October, asking prices rose by 0.3 per cent, less than the standard 1.3 per cent rise for that month.
“The big picture of market activity remains positive when compared to the quieter market at this time last year,” Tim Bannister, Rightmove’s director of property science, said.
“This sets us up for what we predict will be a stronger 2025 in both prices and number of homes sold, particularly if mortgage rates fall by enough to significantly improve affordability for more of the mass market.”
Rightmove forecasts house prices will increase by four per cent through 2025. Mortgage rate cuts are still expected over 2025, but cuts to the base rate are currently forecast to be slower paced.
Bannister added: “We now predict that we’ll see a stronger year for prices in 2025. The signs are that the market momentum that we’ve been seeing this year will continue into next year, especially if mortgage rates drop to a level that gives greater affordability to some movers who have been waiting in the wings until now.”
Kevin Shaw, national sales managing director at Leaders Romans Group, said: “It’s definitely an interesting time in the market but as we go into 2025 we expect market sentiment to improve further.”