£5K house price drop, but Rightmove forecasts big asking price increases in 2025

The average price tag on a newly marketed home has fallen by more than £5,000 in November compared to the previous month, according to Rightmove

The average asking price for a newly listed home in the UK has dropped by over £5,000 in November, according to property website Rightmove.

The average asking price for a home new to the market now stands at £366,592, representing a 1.4% or £5,366 decrease from the previous month. This decline is sharper than the usual 0.8% drop observed during this time of year, marking the second consecutive month of weaker-than-expected price growth.

In October, prices saw a modest 0.3% increase, which fell short of the typical 1.3% rise for that month. Despite this, Rightmove forecasts a 4% increase in asking prices across 2025, albeit with a caveat that the market remains sensitive to prices and seller competition is at its highest in a decade. With further mortgage rate cuts anticipated in 2025, the Bank of England's base rate cuts are now expected to be more gradual.

Tim Bannister, Rightmove's director of property science, commented: "The big picture of market activity remains positive when compared to the quieter market at this time last year. 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."

According to Rightmove's data, a decline in buyer inquiries to estate agents following the autumn Budget was subsequently followed by an uptick in buyer demand in response to the recent Bank of England base rate cut. The property website is bracing for the typical seasonal dip in home-moving activity as Christmas approaches.

Mr Bannister commented: "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."

"However, we still expect some twists and turns next year. The speed at which mortgage rates come down next year will be key in determining activity levels for some of the market’s traditionally busiest periods, and sellers will still need to price temptingly enough to secure a buyer while the choice of homes for sale remains as high as it is right now."

Estate agents also shared their insights. Kevin Shaw, national sales managing director at Leaders Romans Group, observed: "It’s definitely an interesting time in the market but as we go into 2025 we expect market sentiment to improve further."

Alastair Cochrane, group sales and operations director at Stirling Ackroyd, noted: "Overall yields have increased with rising rents, which should give investors some comfort despite increases in stamp duty."

Alex Caddy, manager at Clarkes Estate and Letting Agency, commented: "We have two camps of sellers at the moment – those without time pressure are holding fast with their asking prices, while others who reduce their price to attract a buyer more swiftly have more luck once they find a competitive price point."

He added: "There are still many sellers planning their moves who are out looking despite not yet having a buyer themselves. There is certainly optimism that as first-time buyer activity picks up, this will create the much-needed knock-on effect to kick-start next year."