UK Housing Market Faces Glut as Buyer Enquiries Decline

The UK property market is currently experiencing a significant imbalance, with the number of homes for sale at a 12-year peak while buyer inquiries have dropped. Data from property portal Rightmove indicates that this oversupply is leading to a slowdown in sales.

The number of buyers making inquiries is down 9% compared to the previous year, a trend mirrored by a 9% annual decrease in sales agreements. This situation contrasts sharply with 2021, when a lower inventory of homes for sale coincided with a higher volume of buyer activity, resulting in only a quarter of listed properties failing to sell.

Estate agents report a notable decline in viewings, with an average of two viewings per property in the summer of 2026, a decrease from over six per property in early 2022, according to Propertymark. Currently, approximately four out of every ten homes listed on the market struggle to find a buyer.

Impact of Rising Mortgage Rates

The primary driver behind this supply-demand mismatch is attributed to the rising cost of mortgages. The average five-year fixed mortgage rate has reached its highest point since 2023. Additionally, the average two-year fixed mortgage rate has climbed to 5.29%, up from 5.09% last month and 4.25% before the conflict in Iran began. This escalation means the average monthly mortgage payment has increased by approximately £180 since late February, placing additional financial strain on potential buyers.

Regional and Property Type Variations

The challenges are not uniformly distributed across the country or property types. London's market is particularly affected, with nearly six out of ten homes in the capital failing to secure a buyer. While houses generally see about a third of listings find a buyer, the success rate for flats is only 50%.

In terms of asking prices, the average for newly listed flats has decreased by 2% over the past year, while houses have seen a modest 0.4% rise. In the North West of England, where property prices are generally lower, about three in every ten homes do not find a buyer, compared to nearly half in the more expensive South East.

The Critical Role of Pricing

Estate agents emphasize that accurate and competitive initial pricing is crucial for securing a sale. Rightmove data supports this, indicating that 74% of homes sold this year were priced correctly from the outset and did not require subsequent reductions. Marc von Grundherr, director of Benham and Reeves estate agents, noted that in markets like London, where buyers have numerous choices, over-ambitious pricing can deter potential purchasers and lead to properties appearing 'stale' over time.

Scotland presents a different scenario, with approximately nine in ten homes finding buyers. This is largely attributed to distinct buying and selling regulations and practices in the region.

Signs of an Autumn Market Bounce?

Despite the prevailing challenges, there are tentative indications of a potential market shift. The average asking price of newly listed properties rose by 0.7% in September, marking the first increase since May. This rise is also higher than the 10-year September average of 0.5%, suggesting a possible traditional autumn market recovery following a subdued summer.

September is typically a busier month as people return from holidays and resume their property plans. However, experts caution that this uptick should be viewed as a modest recovery rather than a significant turning point. Colleen Babcock, a property expert at Rightmove, stated that while September's price increase is a positive sign of confidence, property prices have generally underperformed this year. She stressed that with a high volume of sellers competing for fewer buyers, realistic pricing and high-quality presentation are essential for attracting offers and achieving sales.