Signs that soaring mortgage rates are now biting harder

National price increase masks mixed seller reactions to affordability pressure

The average price of a newly listed home rises by 1.0% this month (+£3,575) to £371,015, which leaves prices virtually flat compared with a year ago, down by 0.1%. However, the national increase masks mixed seller reactions as rising mortgage rates intensify affordability pressures in an already price-sensitive market. Rightmove’s daily mortgage tracker shows that the average two-year fixed mortgage rate has risen to 5.55%, from 5.29% last month, and 4.25% before the war in Iran started in February. The average monthly mortgage payment for a new mortgage has increased by around £250 since February, adding significant pressure to many buyers’ budgets. Higher borrowing costs now appear to be biting harder in regions that had proved relatively resilient this year. New sellers in four of the five lowest-priced areas set lower asking prices this month – the North East falls by 2.0%, Scotland by 1.9%, the North West by 0.6% and Wales by 0.3%. Yorkshire and the Humber is the exception, rising by 0.3%.

London price jump claws back some of the summer losses

Meanwhile, average asking prices rise by 2.5% in London this month, the largest in Great Britain and a reversal of the longer-term trend. However, this month’s growth in prices follows a particularly weak summer in the capital, when London prices fell by 6% across July and August, with new sellers in London now clawing back some of that lost ground. London remains the weakest performing region annually, with prices still 1.7% below a year ago.

There are other factors likely contributing to this large October jump in new seller pricing in the capital. It is typical to see stronger seasonal price growth in London at this time of year , with sellers who have flexibility on timing deliberately coming to market in the Autumn, when there are typically more active buyers, rather than the slower Summer season. This is particularly prevalent at the top end, with Inner London prices rising by 3.9% this month, lifting both the national and overall London figure.

In addition, after a subdued year for London prices, some new sellers may feel they have little room to go lower without making their onward move unaffordable. By contrast, sellers in more northerly regions, after a stronger year for prices, may have more room to adjust their expectations. Wider activity indicators do not support a broader London recovery. In the capital, 38% of listings are being reduced, homes take 78 days on average to find a buyer, and fewer than half (42%) of homes successfully find a buyer, with London performing weakly in all three metrics compared with the rest of Great Britain.

Sales activity remains resilient despite rate pressures, as Budget approaches

Despite mortgage rates accelerating upwards in recent weeks, sales activity has so far shown resilience, with deals still being done for the right properties at the right price. Rightmove’s real-time daily data shows that the number of sales being agreed is 8% lower than a year ago, evidence of the more challenging market conditions this year, though broadly in line with the year to date. That sales activity has not fallen back further despite the volatility in the mortgage market and higher costs since February is a positive sign for underlying demand and gives a glimmer of insight of where the market could be if affordability pressures eased.

Meanwhile, the number of new potential buyers contacting agents about properties is 9% lower than a year ago, and the number of new listings coming to market is 3% higher. The total number of homes available for sale remains at its highest level for this time of year since 2014, with the high volume of homes for sale contributing to muted new seller asking price growth.

Attention is now turning to the forthcoming Budget. Financial markets will be watching how the announcements affect the outlook for government borrowing, inflation and interest rates. Some first-time buyers may also be waiting for more detail on the recently announced Your First Home scheme for new build properties, while other households will be considering what the wider announcements could mean for their finances.

The numbers at a glance

Expert comment

“The rapid rise in mortgage rates is really beginning to hit buyers’ budgets. We’re now seeing mortgage rate rises feed through to seller pricing in many of the cheaper parts of Great Britain, where prices had been more resilient this year. It’s an early sign that higher mortgage costs are putting pressure on affordability even in markets with lower property prices, affecting the areas and types of property that buyers can afford. This is a stark reminder of how price-sensitive the market is, and the message from agents, backed up by our data, remains the same – that competitive pricing from day one of marketing is critical to capitalise on initial buyer interest.

“Higher mortgage rates are putting pressure on affordability across Great Britain, but sellers appear to be responding in different ways. Some have room to lower their expectations, while others need to hold firm on price to make their next move add up, even if that means waiting longer for a buyer. In such a price-sensitive market, the guidance and expertise of a local agent are paramount. The forthcoming Budget adds some uncertainty too, with financial markets hoping that will improve the outlook for interest rates, while potential home-movers will be waiting to see how they are directly or indirectly affected.”

Average asking price trends

Monthly average asking price trend

In October 2026, the average asking price of newly listed properties is £371,015, a monthly change of +1.0% and an annual change of -0.1%.

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Five-year asking price trend

The chart places the current monthly asking price alongside the historical observations held in the report.

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Monthly changes in average asking prices

The latest monthly change is +1.0%. Monthly comparisons can reflect seasonality and changes in the mix of properties coming to market.

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Average stock per agent

The latest stock observation is 2026-09; total stock includes properties under offer or sold subject to contract.

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Average time on market nationally

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Regional map

Asking prices and time on market by region

The regional map compares average asking prices, monthly and annual changes, and average time on market. Regional differences help explain why the national average does not describe every local market.

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London trends

Average time on market in London

The London series uses the workbook’s average time on market, rounded to whole days. It should be read alongside asking-price movements rather than as a measure of completed transactions.

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Affordability trends

Monthly rent and mortgage costs for a first-time buyer home

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Asking prices and income-based borrowing capacity

The chart compares the average asking price of a first-time-buyer property with 4.5 times annual earnings for one person and two people. Weekly earnings from ONS KAB9 are multiplied by 52 to annualise them, then by 4.5. This is an illustrative income multiple, not a mortgage offer or a measure of a buyer’s deposit.

Earnings observation: 2026-07-01.

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The latest available average monthly rent for homes with up to two bedrooms is £1,308 (2026-09-01).