Home sales pick up after biggest July price drop in two decades

Rightmove reported a significant 1.2% drop in UK property prices in July, as the average asking price decreased by £4,531 to reach £373,709. London saw the sharpest drop, with prices falling by 1.5%, and Inner London properties becoming 2.1% cheaper. The average property price in the capital is now back to £684,689 after crossing the £700,000 mark in June.

Buyers are excited about price corrections as sellers compete

Buyers and investors welcomed the steepest price drop in 20 years, as Rightmove further reported a 5% increase in agreed sales compared to July of last year. In addition to increased sales, property enquiries have also risen, as the number of potential buyers contacting estate agents about homes for sale has increased by 6% compared to last year.

One of the main reasons for the drop is the high availability of housing stock, which is at its highest level in over a decade. However, price drops in July are common, as the summer holiday season usually sees a lull in buying activity.

Lower mortgage rates are another shot in the arm for buyers

While price drops have undoubtedly caught the interest of buyers, lower mortgage rates are another positive for homebuyers. According to Rightmove, the average two-year fixed mortgage rate is now 4.53%, compared to 5.34% last year. This contributes to a monthly saving of up to £150 on a typical new mortgage. Another piece of good news is that experts predict the Bank of England (BoE) will announce two more rate cuts in 2025.

Home values grow by 20% in 5 years

Despite recent price corrections, Zoopla reports that average property prices in the UK have increased by
20% over the last five years. While the average home has added £55,800 to its value since 2020, eight out of 10 homes are now worth £60,800 more. This rise indicates that, despite seasonal fluctuations, Britain’s property market is resilient, stable, and continues to grow consistently in the long term.

New projects in Poplar and Nine Elms showcased in Singapore

Our office in Singapore concluded a series of back-to-back successful property showcases this July. Starting with River Park Tower in Nine Elms, a rare riverside opportunity in Zone 1, our team went on to host the launch of Heron Wharf in Poplar. They also collaborated with AIA and the Bank of Singapore to host an exclusive property event for savvy investors looking to invest in London.

The Broadley takes centre stage in Hong Kong and Malaysia

Our offices in Hong Kong and Malaysia showcased The Broadley, a brand-new residential development in London’s affluent and sought-after Marylebone area. Just a short walk from three Zone 1 stations, residents will enjoy access to seven Tube lines from here for quick commutes to central London’s business districts and top universities.

Rising rents outpace mortgage inflation and house prices

According to the BoE’s latest mortgage data, average rents in the UK have increased by £221 in the last three years, compared to the £218 rise in average monthly mortgage payments. Rents in the capital have witnessed the highest increase, with some areas reporting a rental growth of up to £400 since 2022. While the average rent in the UK is now £1,283 per month, the average monthly mortgage payment stands at £1,154.

Rents in London keep up with decade-high inflation

In our latest research, we analysed an increase in monthly rents across London’s 32 Boroughs from May 2015 to May 2025. Our findings revealed that while average rents in the capital increased by 39.2% in the last decade, the real-time increase after adjusting for inflation is just 0.7%. Although the average rent in London rose from £1,616 to £2,249 in the last 10 years, the inflation-adjusted change is £15 more per month in real terms.

At Benham and Reeves, we bring overseas buyers and investors the latest property deals across London to diversify their portfolio and earn attractive rental yields. We have 21 branches across the UK capital, along with
14 overseas offices that help you find the right property and also offer a seamless property management and lettings experience. Contact us today if you are looking to buy, sell or let your London property.