Rates fall 1% as sellers seek attention against World Cup and heatwave – Mortgage Strategy

The average asking price of newly listed homes fell by 1% in July to £372,359, as the heatwave and World Cup exacerbated the usual summer slump, Rightmove’s latest index shows.

Over the past decade, asking prices have fallen by an average of just 0.2% in July and Rightmove believes this month’s sharp drop reflects the fact that estate agents have to compete for buyers to beware of summer disruptions.

Activity levels in the markets remain lower than this time last year, with mortgage rates rising due to the Iran war contributing to challenging conditions.

The number of agreed sales in the first half of the year was 6% lower than the same period in 2025, however it was the same as the first half of 2024, indicating that many buyers are still tempted if the property and price are right.

A competitive asking price is key to a successful sale, rather than relying on price reductions later, says Rightmove.

An analysis of all homes sold so far in 2026 shows that nearly three-quarters were sold without requiring a price reduction.

High inventory levels mean that sellers have to be more competitive on price.

While the number of homes available for sale is down 1% from this time last year, it is still very close to a 12-year high for this time of year.

Summer is always a quiet time, as the holiday season disrupts or delays consumer plans, but this year the World Cup and an unusually hot summer also contributed to a slowdown in activity.

Rightmove’s analysis shows that the first heatwave in May caused a temporary drop in consumer demand of 8%, while the hot weather in June caused a similar temporary drop of 6%.

The July heatwave caused a 4% increase.

Rightmove’s property expert Colleen Babcock says: “This month’s more than average price drop reflects the reality of a market where buyers have more choice and sellers are having to work harder to stand out and attract them.

“They also compete with a number of distractions that have been keeping the minds of other potential buyers busy, namely the World Cup and hot weather.

“While these disruptions are temporary, they add to what is already a disruptive summer holiday season to create a challenging retail environment.”

He adds: “The first half of 2026 has been more challenging than many had predicted, as the unexpected war in Iran has contributed to higher loan levels and greater uncertainty for consumers.

“Although activity remains below last year’s levels, it is encouraging that the number of sales agreed in the first half of the year is in line with 2024.:

Propertymark chief executive Nathan Emerson says: “While the year started with optimism for the housing market, global volatility has dominated in many ways since then.

“Accordingly, many consumers have been more careful with their spending to ensure that the household budget is better protected against unexpected increases in costs.

“In recent months, we have seen mortgage lending go down significantly, along with a low number of new home approvals.

“All eyes will be on the Bank of England at the end of the month as it makes its next decision on the base rate, something that will set the tone, especially for those considering their next move or with mortgage tracker products.”