The average asking price for newly marketed properties has dropped by 1.9% in August to £364,895, new figures published by Rightmove have shown.

According to the latest Rightmove House Price Index, this is the largest fall in asking prices at this time of year since 2018, outpacing the average drop of 0.9% in August’s traditional summer slowdown.

Rightmove has suggested this larger than usual August price drop indicates that some sellers are seizing the initiative and heeding their agents’ advice to price competitively for their current local market conditions, in order to attract a buyer against the backdrop of holidays, cost of living pressures, and the highest Bank of England base rate since 2008 – which currently sits at 5.25%.

Average asking prices are now £8,000 (2%) lower than at their peak in May, although in the larger context of significant price growth over the past four years, average prices are still £59,000 (19%) higher than they were in August 2019.

Director of property science at Rightmove, Tim Bannister, said: “There are still significant challenges in saving up enough for a deposit and affording higher mortgage payments, however would-be buyers are now likely to see greater property choice in their area and therefore a home more likely to suit their needs compared to during the pandemic.

“But while there is more choice there is no glut of properties for sale, with the number of available properties still lower than at this time in 2019 and homes still selling more quickly, with the average time to find a buyer now 55 days compared to 61 days in 2019.

“While a 1.9% drop in just one month seems dramatic, it’s in part an expected seasonal drop as sellers coming to market realise that they have to compromise on price due to the traditionally quieter summer holiday period.”

The number of sales being agreed is now 15% lower than at this time in 2019, as higher mortgage rates mean that some have had to pause their moving plans for now.

Rightmove’s data has indicated that the typical first-time buyer sector of two-bedroom and fewer properties is down by only 10%, while the number of buyers sending enquiries to agents about properties for sale in this sector remains 1% above 2019’s pre-pandemic levels. The property expert also suggested the smallest-homes sector holding up more strongly is likely due in part to the frenzied rental market.

Average asking prices in the first-time buyer sector are down by 1% compared to last year, while average advertised rents for the equivalent type of home are significantly up by 12% over the same period, and by 33% compared with the same time in 2019.

“Our analysis shows that homes that are priced right the first time, rather than priced too high only to be reduced later, are not only more likely to find a buyer, but more likely to find a buyer quickly,” Bannister added.

“However, with sales holding up more strongly in the typical first-time buyer sector, the prospect owning your own home remains an appealing option for those that can afford it, with the alternative being an extremely frenzied rental market, where rents are at record levels.”

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