House prices are up 2.2 per cent while asking prices fall. That gap is the whole story of the UK property market right now.
I once watched a seller lose eleven months and roughly forty thousand pounds by refusing to move on price. Not to a crash. To the passage of time. Every few weeks he shaved a little off, always trailing the market by a fraction, always pricing against a comparable sale from a season that no longer existed. Eventually he accepted less than the first offer he had turned down.
I think about him whenever I read a property headline, because the headlines this summer are contradicting each other, and the contradiction is the story.
Two indices, two different stories, one truth
Nationwide annual house price growth at 2.2 per cent as of June, with prices flat over the month itself. The official index had growth at 3.8 per cent in the year to April. Rightmove, meanwhile, showed average asking prices down 0.6 per cent in June, the largest June fall in fourteen years.
Both are correct. They are measuring different things.
Nationwide and the official index measure what buyers actually pay, drawn from mortgage approvals and completed sales. Rightmove measures what sellers first ask when they list. So one number tells you about transactions and the other tells you about hope.
When paid prices hold steady while asking prices fall, it means sellers are the ones adjusting. They are coming down to meet the buyers rather than waiting for buyers to come up. That is a market repricing itself in an orderly way, and it is a considerably healthier picture than the word “fall” suggests.
What is actually squeezing activity
Mortgage rates did the damage this spring. A two-year fix climbed towards five per cent through March and April, then eased back to around 4.6 per cent by the start of July as inflation came in softer than expected. Still higher than the year began, and lenders remain cautious.
You can see it in the volumes rather than the prices. Mortgage approvals for house purchases in May were the weakest since late 2023, with remortgaging down sharply. Completions lag approvals by a month or two, so the quieter figures are still working their way through.
And the market has split. Well-priced houses are selling at close to last year’s pace. Flats are sitting. Anything listed at a price belonging to an earlier market is sitting longest of all, and unsold stock has been building.
That is a sorting market, not a sinking one. It is dividing itself by affordability, quality and readiness.
The tax question hanging over the top end
There is one policy shadow worth naming plainly. A proposed high-value council tax surcharge, widely called a mansion tax, is under consultation and expected to apply from April 2028 to homes in England valued above two million pounds.
It is already changing behaviour. Industry research suggests softer valuations have nudged more homes below that line, which tells you something about how sensitive the top of the market is to a threshold that has not even arrived yet. Announced taxes move markets long before collected ones do.
How I read it
I am not going to tell you whether to buy. That depends on your deposit, your job security and how long you plan to stay, and no article knows any of those things.
What I will say is that this is the least exciting kind of market and, for a patient buyer, often the most useful. Nobody is queueing at viewings. A third of listed homes have had to reduce their asking price. Choice of stock is at a decade high. Sellers who need to move are negotiable in a way they were not two years ago.
If you are selling, price to the buyer who exists today, not the one who existed in 2024. That is the entire lesson of my eleven-month seller.
If you are holding, note that the forecasters expect this to be a flat stretch rather than a permanent condition. Savills has around four per cent growth pencilled in for 2027 and stronger years after, on the assumption that wages catch up and rates come down. Forecasts are opinions with decimal places, so hold them loosely, but the direction is the point. You can read Savills’ own monthly market update rather than take my summary of it.
And if the noise is getting to you, remember that a house is the least liquid thing most people will ever own, and that illiquidity is precisely why it has historically rewarded people who sat still. The cost of living pressure that makes everything feel urgent, which I looked at in Why Life Still Costs More When Inflation Falls, is exactly the pressure that talks people into moves they later regret.
Flat is not failure. Flat is just the market taking a breath while incomes catch up with prices.
The Jacqueline Brand — knowledge builds confidence, confidence builds wealth. This is editorial commentary for inspiration, not financial or professional advice. Always do your own research. The Collection
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