July sees biggest UK house price fall for 20 years

The latest data from property website Rightmove shows that the average asking price for a home coming to market in the UK has fallen by 1.2%, the largest drop in July recorded in over 20 years. The average monthly drop is equivalent to £4,531, bringing the national average asking price of a house in the UK to £373,709. A dip in prices during the summer is not unusual and it doesn't necessarily point to a market in decline. Instead, the data suggests a significant rebalancing being driven by intense competition among a high number of sellers, which is creating a window of opportunity for buyers. In this article, we explain what the latest Rightmove data means, whether you are looking to buy or sell in the current climate.

Latest Rightmove house price data explained

While the monthly average asking price drop of 1.2% is relatively sharp, on an annual basis, prices are almost flat, sitting 0.1% higher than the same time last year. What makes the current situation unusual is that this price drop is happening alongside strong buyer activity. A fall in prices is often associated with a drop in demand, but the data shows the opposite. The number of sales being agreed is actually 5% higher than in July 2024, and the volume of potential buyers contacting estate agents is up by 6% over the same period. The likely cause, therefore, is not a lack of buyers, but a surge in the number of sellers. This has created a competitive market; buyers now have plenty of choice, meaning sellers must price their homes more competitively in order to stand out.

Colleen Babcock, property expert at Rightmove said: "We’re seeing an interesting dynamic between pricing and activity levels right now. The healthy and improving level of property sales being agreed shows us that there are motivated buyers out there who are willing to finalise a deal for the right property. What’s most important to remember in this market is that the price is key to selling. The decade-high level of buyer choice means that discerning buyers can quickly spot when a home looks overpriced compared to the many others that may be available in their area. It appears that more new sellers are conscious of this and are responding to this high-supply market with stand-out pricing to entice buyers and get their home sold."

Rightmove data by property type

The data varies by the type of property being sold. The "Top of the ladder" segment, which includes the largest and most expensive homes, has seen the biggest monthly price drop of 1.6%. In contrast, properties typically sought by first-time buyers and 'second-steppers' saw a more modest fall of 0.6%. For those looking to move up the property ladder, this can present an opportunity, as the price drop on a larger home may be greater in cash terms than the price drop on the home they are selling.

Market Sector	Average asking price	Monthly change
First time buyer	£227,466	-0.6%
Second-stepper	£346,222	-0.6%
Top of the ladder	£687,422	-1.6%

What does the latest Rightmove data mean for you?

While sellers are navigating a challenging environment, a combination of factors are actively improving the financial position for buyers. Below we explain what the data means for sellers, buyers and also for those moving house:

Sellers: Price is Key

The key message from the latest data is that in this market, pricing correctly from day one is crucial. With so many properties available, buyers are likely to ignore an overpriced home and simply look elsewhere. Realistic pricing is likely to be the key to success, as it is helping to drive a 5% increase in the number of agreed sales compared to last year.

Buyers: Seize the Advantage

The latest data shows that this is a market where buyers hold an advantage. The combination of an abundance of choice and improving affordability has created a window of opportunity for buyers. Be prepared to negotiate from a position of strength. Sellers are motivated, and a realistic, well-researched offer is more likely to be considered.

Home-Movers: Winners and losers

Those selling one home to buy another are in a unique position. If moving up the ladder, the 1.6% price drop on a larger "top of the ladder" home may be greater in cash terms than the 0.6% fall on the property being sold, potentially making the move more affordable overall. The opposite is true for those moving the other way, wishing to downsize.

Summary

The latest house price data from Rightmove shows a significant monthly drop in the average asking price. Asking prices usually fall as a result of a lack of willing buyers, but this drop is more likely due to the decade-high supply of homes for sale, forcing sellers to be more realistic with their pricing. In response, Rightmove has halved its price growth forecast for 2025, from +4% to a more muted +2%. Interestingly, Rightmove has retained its forecast of 1.15 million property transactions for the year, indicating that the market is expected to be just as active as previously expected, but at more sustainable price levels. For more information on house prices, check out our article 'What is going to happen to UK house prices?' where we provide data and commentary from Nationwide and Halifax, as well as the latest data from the UK house price index.