A third of homes for sale have been reduced in price, Rightmove has revealed, as sellers struggle to find buyers in an increasingly tough market.
The property listings giant said 'over-optimistic' initial pricing was leading to longer selling times and eventual asking price cuts on 32 per cent of homes.
The imbalance between supply and demand means buyer choice has reached its highest level for any May since 2015, creating a highly competitive market where home hunters can be much more selective.
Despite this, ambitious sellers continued to price higher. Over the past month the average price tag of a home newly listed for sale rose £4,333, or 1.2 per cent, to £378,304.
Rightmove said agreed sales this month were 4 per cent lower than at this point a year ago, when mortgage rates were 'significantly lower', albeit they were 2 per cent higher than at this time in 2024.
According to Rightmove's analysis, a home reduced in price takes 91 days longer to sell than a property that has not needed to have its price cut.
Ups and downs: Average property asking prices since May 2021, according to Rightmove
The online property portal sounded a note of optimism, saying the housing market was not buckling under the weight of higher mortgage rates and remained 'confident overall despite global uncertainty and resulting cost-of-living pressures.'
Buyer affordability continues to drive a marked year-on-year North-South divide in price growth.
In the North East, where homes are more affordable, the average newly-listed price tag was £200,789, up 2.7 per cent on a year ago. In the North West, the average price tag of newly-listed homes was 2.6 per cent higher than a year ago.
In contrast, in London the average price tag dropped 2.4 per cent annually to £685,347.
In the South East, the average cost of a property coming to market was 1.6 per cent lower than a year ago, at £489,561.
Coleen Babcock, a property expert at Rightmove, said: 'It's normal to see asking prices pick up as we move through the spring selling season.
'What's notable this month is that activity in the market is staying fairly steady, even with the ongoing cost-of-living pressures and wider global uncertainty.'
She added: 'Prices are rising in the North, but all buyers should note that buyer choice is now at its highest level for this time of year since 2015.'
Rightmove said the average two-year fixed rate mortgage had fallen to 5.18 per cent, from 5.42 per cent a month ago. The shift means monthly mortgage repayments on this type of deal were about £50 lower than the previous month.
How long are homes taking to sell?
Finding a buyer for a property in London currently takes around 71 days, Rightmove said. In the South East it takes 67 days.
In the South West, where the average asking price is £389,772, it takes roughly 68 days to find a buyer.
In Yorkshire, the average time taken to find a buyer is 62 days, falling to 61 days in the West Midlands, 57 days in the North West and just 31 days in Scotland.
Babcock said: 'Getting the asking price right from the outset is therefore increasingly important, as homes priced too ambitiously are taking longer to sell.'
Research published by Zoopla this month revealed that more than two in five homes put on the market in the past three years did not go on to sell. It said many sellers are setting unrealistic asking prices which put potential buyers off.
It surveyed 2,000 people who had listed their home with an estate agent in the past three years, and 44 per cent said the property never sold.
Of those, 34 per cent admitted in retrospect their asking price was 'too high'.
Among those who did sell, 53 per cent said they had to cut their asking price before they found a buyer.
In the first three months of this year, homes listed on Zoopla typically sold for 3.5 per cent below the asking price. This is a cut of £18,800 on an average–priced home.
