Property Prices Fall 1.2%: a market crash or a correction we’re expecting?

It is certainly why we at The House Group advertise our properties there.

But what you might not realise is quite how much Rightmove is also a regular contributor of data, market commentary and source-material for news headlines.

The July edition of the Rightmove House Price Index was released last week – in which it has reported a 1.2% drop in asking prices between June and July. It is the steepest drop in the month of July since 2002 – and of course, it comes on the coattails of the monthly fall in June (if you remember a blog of mine from last month, June had just experienced a small drop of 0.3% – noteworthy due to it being a month where property prices normally increase. Noteworthy too, was that the Swindon market was far ahead of this trend locally…).

This 1.2% figure reported by Rightmove is the national one, but London is reported to have fared worse still, recording a 2.1% price dip in July.

Rightmove is not alone. Nationwide Building Society has come out with a similar story, showing property values to have dropped by 0.8% in June.

Meanwhile, publications from The Guardian to MoneyWeek have begun asking if the crash is coming. Some have even nailed their colours to the mast already and stated that it is on its way.

So, the question is, is it?

And what is the picture for you, if you are buying, selling or letting out property in Swindon?

A Property Crash… or just a Slow Summer?

It is fairly widely accepted that the summer holiday can have an effect on the property market. July often can be quieter. Families are preparing for holidays. Sports events take over evenings and weekends (well done the Lionesses!). This time round in July, we had not one but three mini heat-waves that slowed people down, or sent them scattering for the nearest coastline or country park on their days off. Schools broke up too, of course – and yes, state schools only last week, but private schools had broken up earlier still, plus any children who have taken their exams this year were already off school and back under parents’ feet. Even 18-year-old children can be a distraction to parents and put a property search on hold for a time.

These things conspire to see the relative urgency of the spring market subside, and data shows that property ‘time on market’ can drag as a result.

Prices themselves however do not always fall over the summer. That is a trickier one to call. Here in Swindon, property prices actually rose slightly last summer. Nevertheless, that was not without context. Last summer, we had just had a general election, and a new government had been brought to power in a landslide vote. This isn’t a political statement; it is just to point out that consumer-led markets do often feel a positive bounce after those sort of events, which might have superseded anything that would otherwise have occurred in that summer market if left to its own devices.

The point is, we can rarely look at any market in isolation – we have to look at all sorts of factors going on around it, take a measured look at what is coming down the tracks, and offer our considered opinions.

That being said, whilst a price dip at this point in the calendar is not therefore unusual in a summer that is unaffected by ‘stimulus’ events, this particular decline reported in July does look pronounced.

This year compared to last, the context is different. The political landscape is different, and the public mood about that landscape has changed. And don’t forget, we had a peculiar event earlier this year that changed the normal pattern of the property market calendar, with a greater rush of transactions during the first quarter followed by a quieter-than-normal second quarter (which we only came out of a month ago), owing to the end of the Stamp Duty Holiday on March 31 2025. It was an event that economists and housing commentators suggested would lead to a drop in prices in the months that followed, as property buyers’ purchasing costs went up accordingly.

Even so, the pattern of the property market this year still largely resembles that of other years, in macro terms. Looking at the ten-year average, other than last summer as mentioned earlier, and the Covid-driven boom of 2021 and 2022, where prices continued to rise over many months, this year’s market slowdown seems to me to mark a return to something more seasonally familiar.

It does not look like a dangerous departure from the norm.

A Swollen Property Market

Take away any thoughts of the wider political, geo-political or economic background, the thing that is really putting pressure on asking prices this summer isn’t panic-selling – it is the number of properties currently for sale.

There has been a noticeable build-up in unsold inventory. According to property data site home.co.uk, there are currently over 1,300 properties sitting unsold, just as the market is set to slow down.

In some ways, the summer market is not unlike a December market. In December, buyers get distracted by holiday festivities and many put their thoughts of moving on hold for a month or three – but the difference is that when it comes to the summer we have experienced a greater build-up of listings throughout Spring, leaving a glut of properties for sale in a market with suddenly fewer buyers, whereas in December, listings and new-buyer applications gradually begin to tail off from the end of October, leaving a quieter market all round – but often not an imbalanced one.

And that is the point; in the summer, it is that balance that is off, weighted heavily by listings and lacking, for a brief period, quite as many serious buyers as there were in May and June (and that normally there will be again come September and October).

It is a situation that can prompt sellers and their agents to have more realistic discussions about price, so I’m sure we will continue to notice price reductions over the next four or five weeks, too.

This is not a crash, though. Or at least, in itself, it does not mean it is a crash. It is however, a case of supply overtaking demand, and a number of motivated sellers adjusting prices to encourage a sale.

Frankly, this sort of market recalibration is healthy. The last few years have felt a bit frenzied – more of a ‘seller’s market’, where local prices in Swindon have gone up and up.

Market analysis from Rightmove shows us that prices in Swindon have risen slightly, by just 1% over the past year. That is behind the national trend of 3.9% growth, according to ONS figures. However, it wasn’t many months ago that I was reporting that prices in Swindon and Wiltshire were far outpacing the rest of Southwest and the UK as a whole. And that’s the thing about the market – it fluctuates… and effectively, when it does so, it rebalances. When it is flat or only minimal percentage-points being discussed, realistically it barely registers – especially over the long term.

Property Price Forecasts Trimmed

Several respected analysts have revised their 2025 ‘national’ forecasts in light of recent trends. Savills, for example, now expects just 1%-2% growth this year – much in line with that picture we have seen here in Swindon. Rightmove’s analysts have more or less matched this same prediction, revising their prediction from 4% annual growth to 2%.

This is still not what we would call ‘collapse’ territory. It looks like a modest, manageable adjustment.

We’re certainly not seeing the kind of plummeting values that defined the 2008 crash, and we are miles away from the picture seen in the early 1990s. We are not seeing many forced sales, nor seeing mass repossessions flooding the market. It feels like a soft landing, not a sudden crash.

If property prices do rise by 1-2% this year only, it will mean they have risen slower than core inflation – but in terms of this feeling more like a recalibration (and a manageable one), buyers should start to feel like they can catch up, without prices themselves necessarily dropping, especially as wages continue to rise.

As the underlying fundamentals of the market gradually shift in buyers’ favour, it not only looks like a good thing for long term stability, but given the pace will probably bottom out fairly evenly, before beginning to gently tick up.

Affordability: Quietly Improving

Whilst average property prices may be rising less quickly over the past 12 months, average wages have risen by over 5% in the same period. The gap between property prices and incomes is narrowing for the first time in years, giving buyers a little breathing space.

Add to that the recent changes to mortgage affordability assessments, which have increased borrowing potential by up to 20% for some buyers, and we find ourselves in a market that is more accessible, not less.

The July Rightmove House Price Index Report touches on this. It reports how this time last year, the average two-year fixed rate mortgage was 5.3%; at the moment, it is 4.53%, and we know from the mortgage brokers we speak to that many products are available at around the 4% mark or below, to buyers with greater deposits.

Senior Economists such as Paul Dales from Capital Economics predict at least another two cuts to the Bank of England Base Rate this year. We can hope to see mortgage affordability improve further.

Media Noise Versus Market Reality

Let’s return to news headlines for a moment.

A 1.2% drop in asking prices might be a little more chunky than normal for July – but the context matters. We could reasonably expect there to be a slight drop in July and August. The drop we’ve seen might be a little more pronounced than expected, but at the moment it seems less like a market in freefall than it does one in transition.

The housing market might be cooling a little, but this is not a collapse. It is a picture we see most summers, unless something extraordinary changes it up… like an election called early, for example, or a rush back to market following a pandemic-induced lockdown.

If you are on the market or thinking of coming to the market, don’t be put off by headlines. Now might be a time for strategic thinking, but let your estate agent’s experience, as well as the data, guide any next step.

We’ve been through real volatility in recent years. What we are looking at right now simply looks like the start of the summer holidays.

But then again, that doesn’t make such juicy headlines.

A Last Word

Rightmove’s steepest July dip in over two decades is just about newsworthy, but it’s not a crisis – yet.

If things continue like this next month (which they probably will), and then the month after, perhaps we can start treating it as a pattern. But for now, it simply looks like the market allowing itself to cool down after a period of overheating. As mentioned, here in Swindon, we had our moments last year when price growth raced ahead of other UK locations – it is not a surprise to see a bit of rebalancing now as other parts catch up.

Nevertheless, affordability is improving. Stock levels will naturally adjust over the holiday period. Buyers are right to be cautious, and nobody can blame them for that – but the reality is, they are still active. We know that! We are still selling our clients’ houses to them, week in, week out.

For more updates, follow our House Group social media channels and stay tuned to our ‘Inspiration’ blog page – or, if you would like to talk any of it through, give us a call and let’s have a chat (or a coffee and a chat!); we are always happy to help.