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Mortgage Costs Drive Asking Price Falls in Cheaper Areas, Rightmove Reports

Home sellers in four of Great Britain's five lowest house price areas have reduced their asking prices this month, according to Rightmove, as higher mortgage costs impact buyers.

  • Average newly listed asking prices rose by 1% to £371,015 in October, but are down 0.1% annually.
  • Average two-year fixed mortgage rates are now 5.55%, up from 4.25% in February.
  • Sales agreed were 8% lower than the same period last year.

Sellers in four of Great Britain’s five most affordable regions have lowered their asking prices this month, Rightmove data shows. This trend is attributed to increased mortgage costs affecting buyers' budgets.

The average newly listed asking price across Great Britain rose by £3,575 to £371,015 in October, marking a 1% monthly increase. However, this figure represents a 0.1% decrease compared to last year.

Average two-year fixed mortgage rates have reached 5.55%, an increase from 4.25% in February. This rise adds approximately £250 to a new mortgage's monthly payment.

Regional data indicates asking price declines of 2% in the North East, 1.9% in Scotland, and drops in the North West and Wales. Yorkshire and the Humber was the only exception among the five cheapest areas, recording a small rise. In contrast, London saw a 2.5% increase in asking prices, recovering some of the 6% fall experienced in July and August.

The number of sales agreed was 8% lower than the same time last year, mirroring the decline seen over the year to date. Buyer enquiries to agents also decreased, while the availability of homes for sale is at its highest for this time of year since 2014.

Why this matters: Rising mortgage rates are beginning to impact buyer affordability, particularly in areas with lower property prices, leading some sellers to reduce asking prices.

What this means for you: If you are a home seller, competitive pricing from the start of marketing is important to attract buyer interest. If you are a buyer, higher mortgage rates may affect your budget and the types of properties you can afford.

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