House prices hit new record despite subdued Spring market: Rightmove

The average price of property coming to the market for sale rose by 0.6% this month to a new record of £379,517, according to the latest Rightmove figures.

The seasonality of the property market means that we have now seen a May price record for the last five years. However, this month’s increase is smaller than usual, and the lowest in May since 2016, reflecting a more subdued late Spring market. 

The number of available homes for sale continues to run at a ten-year high, creating competition between sellers to secure a buyer for their home, and limiting growth in newly-advertised property prices. 

April saw what appears to be a post-stamp-duty-increase lull in new buyer demand, measured by the number of people contacting estate agents about homes for sale. This slowdown in new buyer demand is perhaps understandable after the busy first quarter of the year, though there are early signs that the lull may be short-lived. Rightmove says mortgage rates will be "crucial in determining the level of buyer activity for the rest of the year". 

Buyer demand saw a 4% drop in April compared to the same period last year - the first month this year that buyer demand has fallen below last year’s level. Along with April’s stamp duty increase in England, some new buyers may have been holding out for the outcome and impact of May’s Bank Rate decision, while President Trump’s approach to tariffs has also created global economic uncertainty. However, year-to-date buyer demand is still 3% ahead of the same period last year, though more front-loaded into the first quarter. Furthermore, there are also signs that April’s lull may just be temporary, with Rightmove’s data now showing an uptick in buyer demand since the beginning of May. In addition, the number of sales agreed in April was 5% ahead of the same period in 2024. 

Positively, the right conditions are coming together to support improved buyer affordability and activity later this year, Rightmove says. Average earnings have been going up and are now over 5% ahead of this time last year, outpacing annual house price growth which is now at only 1.2%. Mortgage lenders have been reviewing affordability criteria and slowly reducing interest rates, helping buyers to borrow more. Rightmove’s weekly mortgage tracker shows that the lowest available two-year fixed mortgage rate is now 3.72%, down from 4.75% last year. The much anticipated second Bank Rate cut of the year has also now finally arrived, which could spur on further rate reductions from lenders. The number of new properties coming to the market for sale is 14% ahead of this time last year, keeping buyer choice at its highest level for a decade which is giving buyers an edge in price negotiations.

With new seller activity currently outpacing buyer activity, sellers are having to work harder to secure a buyer. Rightmove’s research on pricing success highlights the unintended result of pricing a property too high at the start of advertising to test the market, only to have to reduce it later. Homes which need a reduction in price during marketing can take over two months longer to find a buyer. Rightmove’s data also shows that there has been a 32% increase in the number of sellers who have swapped estate agent to try and find a buyer. This reflects the high market competition, and the frustration of some owners that their homes aren’t selling, a process made much harder by setting an over-optimistic price to begin with. 

Colleen Babcock, property expert at Rightmove, commented: “It’s another new price record this month, but having seen a May price record for the last five years, it appears to be driven more by seasonal factors given that new buyer demand has slowed. The ten-year high choice of homes for sale means that sellers need to be aware of the level of competition they’re facing for the attention of buyers, and the prices that are being advertised in their location. In the current market, buyers may well have several similar homes to choose from in their area, and a home which appears over-priced compared to the competition may not get a second look. This month’s price increase being the lowest in May for nine years is a sign of a market that favours buyers and is more subdued than usual.

“Despite April’s dip in new buyer demand, there are early signs of a bounce-back in May. Mortgage interest rates are lower than they were at this time last year, and the recent Bank Rate cut also gives us some optimism for further mortgage rate drops that will enable more to buy. While we’re not expecting drastic reductions, any lowering of rates will be a boost to buyer sentiment and affordability. With a high number of sellers and a small dip in buyer demand, it’s worth reminding people out there thinking of coming to market that they need to work hard to attract buyer attention.”