UK Housing Market Sees Sharpest Monthly Price Drop in Two Decades
📷 Image source: i.guim.co.uk
The UK housing market has recorded its steepest monthly decline in asking prices in 20 years, signaling a potential shift in buyer sentiment amid economic uncertainty. According to data from Rightmove, the average asking price for homes dropped by 2.3% in July 2025—the largest single-month fall since 2005. Analysts attribute the downturn to rising mortgage rates, inflationary pressures, and a cooling demand after years of pandemic-driven surges.
Experts suggest that sellers are adjusting expectations as affordability constraints deter buyers. 'The market is recalibrating,' said Tim Bannister, Rightmove’s director of property science. 'After years of rapid growth, we’re seeing a necessary correction.' The decline was most pronounced in southern England, where prices had previously soared.
Additional reports from the Bank of England highlight a 15% year-on-year drop in mortgage approvals, reinforcing the trend of slowing activity. Meanwhile, the National Association of Estate Agents noted a 20% increase in price reductions on listed properties compared to last year. While some see this as a temporary adjustment, others warn of a prolonged downturn if economic conditions worsen.
First-time buyers may find relief in the softening prices, but higher borrowing costs remain a hurdle. The market’s next moves will likely hinge on interest rate decisions and broader economic stability.
