By Adam Jennings, Head of Residential
London’s autumn property market has opened with a marked change in mood. After a subdued summer, buyers are returning, sellers are coming forward and asking prices are rising for the first time since May.
Rightmove’s latest figures show that the average asking price of a newly listed home across Great Britain increased by 0.7% in September.
That’s stronger than the average September rise of 0.5% recorded over the past decade and provides the clearest evidence yet that the seasonal rebound is under way.
Chestertons is seeing the shift directly. Buyer enquiries through our sales portal delivered their strongest performance for ten months in August, while the number of homeowners instructing us to sell rose by 14% year-on-year.
The recovery is not yet universal, and affordability remains a serious constraint. But after months of hesitation, London’s buyers and sellers are at the very least moving again.
Third-party data from TwentyEA shows that Chestertons strengthened its position across its operating postcodes during August.
New instructions to Chestertons rose by 63.9% year-on-year, compared with a 9% decline across the wider market. We also recorded a 7.8% month-on-month increase in sales agreed, while the wider market across the same areas declined by 18.1%.
These figures indicate that serious buyers and sellers are willing to transact when a property is presented well, priced accurately and marketed to the right audience.
With more homes coming to market and buyer enquiries strengthening, the autumn selling season has begun with greater momentum than we saw during the summer.
Chestertons combines street-by-street expertise with a connected London-wide network. That ability to connect buyers, sellers and properties across London is valuable, particularly as we’re noticing that more buyers are willing to look beyond their immediate neighbourhood to source the best properties.
The renewed momentum does not mean sellers can disregard current market conditions. Reports suggest buyer enquiries and sales agreed across the market remain 9% lower than a year ago, while the number of available homes has reached a 12-year high for the time of year.
That gives buyers plenty of choice and considerable negotiating power. In London, just 42% of homes coming to market are currently finding a buyer, compared with 61% across Great Britain. This makes accurate pricing and a carefully targeted marketing strategy particularly important for London sellers.
The autumn bounce is creating an opportunity for sellers, but it is not lifting every property automatically. Buyers are active, price-conscious and willing to wait if a home appears overvalued.
For sellers, the initial asking price remains critical. Rightmove reports that 74% of homes sold so far this year were priced correctly when they first came to market and did not require a subsequent reduction.
Launching too high can waste the period when a property attracts its greatest attention. A later reduction may simply encourage buyers to focus on newer alternatives.
An accurate asking price does not mean underselling a home. The aim is to generate serious interest and find the right buyer, not simply any buyer.
There is no one-size-fits-all strategy. The right price and marketing plan will depend on the property, its location, current competition and the type of buyer it is most likely to attract.
Presentation and access matter too. Strong photography, careful marketing and flexibility around viewings can make a material difference. If enquiries are weak or viewers repeatedly raise the same objection, sellers should receive clear feedback and practical advice about what to do next.
The Bank of England held the base rate at 3.75% in September, providing some continuity for buyers and sellers. However, borrowers should not assume mortgage costs will remain unchanged.
Three members of the Monetary Policy Committee voted for an immediate 0.25 percentage-point increase. Financial markets and several economists now expect a possible rate rise before the end of the year as inflationary pressure increases.
Fixed mortgage rates are driven largely by swap rates and wider financial-market expectations rather than Bank Rate alone. Lenders had already begun repricing products upwards before the Bank’s latest decision.
The effect of higher mortgage rates on London affordability is clear. A first-time buyer purchasing a £551,000 property with a 10% deposit would need to borrow £495,900. At 5.29%, their monthly repayment on a 25-year capital-and-interest mortgage would be approximately £2,983.
That is £247 more than the average advertised London rent of £2,736 a month.
Although renters face their own affordability pressures, the comparison shows that, while interest rates remain relatively high, renting can leave Londoners with more monthly leeway than buying - without the need to find a £55,100 deposit.
The two figures are not perfectly comparable. Mortgage rates and rents vary, and part of a repayment mortgage builds equity. However, in this example, the mortgage payment would be approximately £247 a month higher.
A purchaser would also need a £55,100 deposit, plus stamp duty, legal, survey and moving costs. They would then assume responsibility for maintenance and, where relevant, service charges.
This helps explain why some Londoners who might once have moved quickly towards ownership are renting for longer. It is not necessarily a rejection of home ownership.
For many, it is a practical or at least temporary response to the upfront cost of buying and uncertainty around future monthly payments.
London is not one market. Conditions vary between neighbouring streets, price bands and property types. Timing also requires realism. Rightmove estimates that it currently takes an average of 64 days to secure a buyer and a further 150 days to complete a sale.
Anyone putting a property on the market now should focus on securing a strong, proceedable buyer rather than assuming every move will be completed before Christmas.
As autumn kicks in, demand is strengthening, more conversations are turning into viewings and buyers with their finances arranged have both choice and negotiating power.
For anyone considering a move, the most useful first step is a clear assessment of the likely sale price, the competition and the demand that exists today. Throughout the process, clients should receive clear updates, practical next steps and proactive communication, particularly when a transaction becomes complicated.
The autumn bounce the market had been waiting for has arrived. At Chestertons we are ready to support sellers with calm, practical advice to help them meet their goals.