Asking prices fall as buyers and sellers await Budget
Average asking prices for newly listed homes have dropped by 1.8% this month, marking the steepest November decline in over a decade, as speculation about the upcoming Budget and potential property tax changes dampens activity at the higher end of the market.
With a growing supply of homes for sale and uncertainty over fiscal policy, the latest Rightmove House Price Index has shown that both buyers and sellers are proceeding with caution, particularly in the upper-tier property sector. These factors are intensifying the usual seasonal slowdown, with the market’s traditional Christmas lull arriving earlier than in previous years.
A significant proportion of sellers are adjusting their pricing strategies. Over a third (34%) of properties currently listed have seen price reductions, with the average cut standing at 7%. Both figures are at their highest since February 2024. The upper end of the market, in particular, remains subdued amid speculation about possible new property taxes.
“The decade-high number of homes available on the market continues to restrict price growth, with many new sellers keen to avoid standing out by over-pricing compared with their competition,” said Colleen Babcock (pictured right), property expert at Rightmove. “The Budget is a big distraction, and is later in the year than usual, with many would-be buyers waiting to see how their finances will be impacted.”
“It appears that the usual lull we’d see around Christmas time has arrived early this year, and sellers who are keen to move are having to work especially hard to entice buyers with competitive pricing. This means that average new seller asking prices are now 0.5%, or £1,759 cheaper than a year ago. In addition, a third of homes already on the market for sale have had their asking price reduced, with an average reduction of 7%, further illustrating that this is a buyers’ market.
Sales activity in the £2 million-plus segment, which may be affected by a potential mansion tax, has fallen by 13% compared to the same period last year. The number of new listings in this price bracket is also down by 9%, a steeper decline than in other segments. The £500,000 to £2 million range has also seen a reduction in activity, with agreed sales down 8% year-on-year, a larger drop than the overall average decline of 5% for the month.
Properties valued below £500,000, which constitute around three-quarters of the market, have shown greater resilience. Sales agreed in this sector are down by 4% compared to last year. While these homes have not been the focus of recent tax speculation, the upcoming Budget is still causing some uncertainty regarding affordability. It is also worth noting that October 2024 saw heightened activity ahead of anticipated stamp duty changes in England, contributing to the year-on-year decline. However, sales agreed so far this year remain 4% higher than during the same period in 2024.
Attention is also focused on mortgage rates and their effect on affordability. The average two-year fixed rate stands at 4.41%, lower than the 5.06% recorded a year ago, but the pace of decline has been slower than many had forecast for 2025. The Bank of England’s decision to maintain the bank rate in November, rather than reduce it, has disappointed some, though a cut in December remains possible.
“The market is increasingly cautious as speculation over the upcoming Budget fuels uncertainty,” said Mary-Lou Press, president of industry body NAEA Propertymark. “When buyers and sellers face mixed signals about potential tax changes, it’s natural to see hesitation and a sharper seasonal slowdown than usual.
“Despite softer sentiment in the higher-value sectors, the broader picture remains more resilient, helped by gradually improving mortgage rates and better affordability. Our member agents continue to report steady interest from committed movers, especially in the mainstream market, typically below £500,000.
“Providing clarity and stability will be key to maintaining momentum as we move into 2026.”
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