House Price Index

Summer buyers distracted by sunshine, football and political change

The average asking price of a newly-listed home coming onto the market for sale falls by 1.0% (-£3,832) this month to £372,359. While a price drop in July is normal, this month’s fall is much larger than the ten-year average drop we’d see in July (0.2%).

Sellers are having to compete harder to attract summer buyers. The supply of available homes is close to a 12-year high for the time of year, giving buyers plenty of choice. Home-movers are always distracted by the summer holiday season, but the World Cup and hot weather have also added to distractions.

Rightmove analysis shows that the first heatwave in May caused a temporary 8% drop in demand from buyers before rebounding. June’s heatwave caused a similar temporary dip in demand of 6%, followed by a 4% drop during the current July heatwave.

A new Prime Minister adds to the distractions that buyers are facing, but also offers a chance to reset political priorities. Rightmove is urging that housing should be high on the agenda, with a focus on changing how stamp duty works and helping house builders to get closer to the target of 1.5 million new homes.

Conditions for buyers remain positive

It’s fair to say that the first half of 2026 has brought some challenges for home-movers and the housing market. The war in Iran pushed mortgage rates higher and the number of sales agreed from January to June was 6% lower than the same period in 2025.

However, sales agreed for the first half of 2026 stayed level with those for this period in 2024. This shows that buyers are still being tempted when they find the right property at the right price.

New Rightmove analysis shows how important it is to set a property’s asking price right from the start of the sales process. Nearly three-quarters (74%) of homes that have successfully sold and completed this year did so without having prices reduced.

Overall, conditions for buyers remain positive. Lenders are competing strongly on rates, wages continue to rise faster than house prices, and unemployment is staying low. This leaves room for optimism for the second half of 2026, particularly if mortgage rates drop and wages continue to grow faster than house prices.

What are mortgage rates doing?

Rightmove’s daily mortgage tracker shows that the average two-year fixed mortgage rate is now 4.92%. This is up from 4.25% in February (before the war in Iran), but down from 5.08% last month*.

“Mortgage rates are higher than many buyers would have hoped for at the start of the year, and the increases due to the war in Iran have understandably dented confidence for some,” explains Matt Smith, Rightmove’s mortgages expert.

“However, lenders remain keen to lend, and the mortgage market is still competitive. There is still uncertainty in the market, and recent mortgage cuts could stop in the near future, however we’re not seeing the kind of difficult lending conditions that have caused more challenging markets in the past.

“If the outlook shifted and we saw reductions in mortgage rates, it would be a welcome boost to confidence and affordability.”

The numbers at a glance

*Data provided by specialist mortgage technology provider Podium Solutions. The data covers 95% of mortgage lending, to exclude specialist lenders.

Expert comment

Colleen Babcock, property expert at Rightmove:

“This month’s larger-than-normal price fall reflects the reality of a market where buyers have plenty of choice and sellers are having to work harder to stand out and attract them. They’re also competing with an unusual number of distractions which have been keeping the minds of some potential buyers occupied, namely the World Cup and the hot weather.

“The first half of 2026 has been more challenging than many predicted, with the unexpected war in Iran contributing to higher mortgage rates and greater uncertainty for buyers. While activity remains below last year’s levels, it’s encouraging that the number of sales being agreed in the first half of the year is in line with 2024.

“Pricing remains critical, and it’s remarkable that nearly three-quarters of homes that have sold so far this year have done so without needing an asking price reduction. A new Prime Minister also presents an opportunity to make housing a renewed priority, with action needed to support affordability, mobility and the delivery of more homes.”

Average asking price trends

Monthly average asking price trend

This graph shows the 1.0% price drop seen in July to £372,359. This is more of a drop than we’d usually see in July, with an average of drop of -0.2% over the past ten years.

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5 year asking price trend

This data shows average asking prices in the UK over the past five years. Here you can see the usual seasonal pattern for prices, including the usual dip as we head into summer.

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Monthly changes in average asking prices

Here we see how much house prices have increased or decreased each month over the past year. The 1% drop for July 2026 reflects more of a dip than the 10-year July average (-0.2%).

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Average stock per agent

Here we see the average of the number of homes per agent across the UK. The number of homes currently for sale is 1% behind 2025 but still very close to a 12-year high for this time of year.

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Time to secure buyer (National)

Here we can see the monthly average number of days it takes for a seller to secure a buyer in the UK. In January this was 81 days, compared with just 60 days in May 2026.

This average gives an idea of how active the property market is, and how accurately people are pricing their properties. For example, properties that are priced too high will usually take longer to secure a buyer.

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Regional map

UK House Price Index by region

This map shows the UK house price index by region, showing how property price trends vary considerably for different parts of the UK. Only Yorkshire and the Humber (+0.3%), the North West (+0.3%) and Wales (+0.2%) saw month-on-month price growth in July.

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London trends

Time to secure a buyer in London

This graph shows the monthly average number of days it takes for a seller to secure a buyer in London. This gives an idea of how active the property market is there, and also how accurately people are pricing their properties in the Capital.

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Affordability trends

Average monthly amount spent on a first-time buyer home

On the graph below, the first-time buyer monthly mortgage payment is based on Bank of England data of the averages for 90% LTV two-year fixed mortgages from lenders, and the average asking price of a typical first-time buyer home (two bedrooms or fewer) using the Rightmove House Price Index. The equivalent monthly rent is calculated using the same property types (two bedrooms or fewer).

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Ability to afford a first-time buyer home

This affordability graph is based on the Average Weekly Earnings (AWE) dataset from ONS multiplied by 4.5 to get the typical maximum that a person can borrow from a lender. The average asking price of a typical first-time buyer home is taken from the Rightmove House Price Index.

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How do mortgage rates affect supply and demand for houses in the UK?

Mortgage rates affect supply and demand in the UK housing market by influencing buyer sentiment and appetite around borrowing.

Higher mortgage rates increase monthly payments for buyers. In response to those higher rates, buyers might increase the term of their mortgage or look at cheaper properties. Alternatively, they might delay their purchases or shift to renting, reducing demand and slowing transaction levels.

Interestingly, any period of uncertainty around rates is likely to cause buyers to pause. Even if rates go up, once they stabilise again, consumers tend to return to the market having adjusted their plans in line with the higher rates.

Similarly, if there is potential for a drop in mortgage rates, transaction levels will slow as consumers wait for a more certain outcome. Consistent lower mortgage rates will then lower monthly payments, increasing buyer demand and supporting higher prices.

It is important to note, however, that a large number of UK property sales take place out of necessity. These do not get delayed as a result of changing rates. Similarly, around a third of all UK property transactions are made by cash buyers, so are not affected by mortgage rates.

Housing supply responds more slowly to changing rates. Higher mortgage rates can reduce the supply of new houses by making it more expensive to develop them, although existing stock may stay on the market longer.

Rightmove is not authorised to provide financial advice. The information and opinions in this article are for general information purposes only and should not be relied upon when making financial decisions. You should seek advice from a regulated mortgage adviser.

Your home may be repossessed if you do not keep up repayments on your mortgage.