Asking prices for UK homes drop sharply – Rightmove

LONDON (Reuters) – Asking prices for homes in Britain fell sharply this month as rising mortgage costs caused sellers to lower their expectations of what they can get for their properties, an industry survey showed on Monday.

Website Rightmove said average asking prices for homes dropped by 1.9%, the biggest monthly fall for August since 2018 and twice as steep as the usual summertime fall.

Britain’s housing market, which boomed during the COVID-19 pandemic, has weakened as the Bank of England fights high inflation with a run of interest rate hikes, although two-year mortgage rates recently dipped from July’s 15-year highs.

Mortgage lenders Nationwide and Halifax both previously reported falls in selling prices in July.

Rightmove’s survey also showed the number of home sales was down 15% compared with 2019, before the pandemic.

Sales of homes typically sought by first-time buyers fell by a less severe 10%, reflecting a 12% jump in rents for properties in that category over the past year, Rightmove said.

Homes on the market as a whole were down by 10% compared with August 2019.

Average asking prices for homes were 2% below their peak in May but, reflecting the surge in demand during the pandemic, remained 19% higher than in August 2019, Rightmove said.

(Writing by William Schomberg, editing by Suban Abdulla)