Biggest gap between new listings and agreed sales in a year
The gap between the number of homes coming to market and agreed sales hit its widest point in a year in September. New listings rose 14.8% versus August, but agreed sales fell 16.1%, which meant that conversion fell to 41.9%, its lowest reading since last December.
The rise in sellers coming to market saw new listings hit 213,048 but agreed sales fell to 89,192, leaving a gap of 123,856 and resulting in a 15.4 percentage points conversion drop compared to August.
The drop to 41.9% is particularly significant, given that conversion had previously stayed between 50.2% and 58.5% in the months from January to August.
Mortgage rates are partly to blame, with the average two-year fixed mortgage rate hitting 5.93% by 1 October, while the effective rate on newly drawn mortgages rose to 4.60% from 4.45%. Approvals for house purchases slipped to 54,900 in August, the lowest number since December 2023.
Regional differences
However, the figures differed by region. Scotland converted 69.5% of new listings into agreed sales, 42.5 points higher than London’s 27.0%. Six regions, all in the North, the Midlands, Wales or Scotland, were above the national figure while all southern regions were below. London’s new listings rose 28.7% while agreed sales fell 14.8%, leaving 20,868 homes unsold from a single month of supply. The South East built the largest backlog in Great Britain at 23,253.
Listings of five-bedroom and larger detached homes rose 36.3% in a month but conversion fell from 51.7% to 31.9%. Instead, two-bedroom bungalows converted the strongest at 61.4%.
Price reductions were also faster and deeper. The time before prices were reduced fell in ten of 11 regions, down from 81 days to 75 in London and to 51 days in Scotland, while the price reduction rate rose to 33.3% from 27.2%. 39.3% of all stock for sale carried a reduction by the end of September.
Matt Gilpin, founder and CEO of Sprift, said: “September showed how quickly confidence can turn. Sellers came back after the summer, but many buyers paused as borrowing costs climbed. More homes chasing fewer committed buyers puts the onus on pricing. The agents who bring that evidence into the valuation will win the instructions that go on to sell.”
