Housing market ‘beginning to soften’ as more sellers cut prices, says Zoopla

The housing market is showing early signs of slowing down even as prices rise 8.4% in a year, Zoopla has said.

he property portal’s latest UK House Price Index shows the average house price rose to a record high of £250,200 in May, 8.4% higher than for the same period in 2021.

However, Zoopla says the market is beginning to ‘soften’. The index shows the annual rate of growth of 8.4% is down from 9% in March, while the quarterly rate of growth has reduced from 2% to 1.3% and the monthly rate has dropped from 0.7% at the start of the year to 0.2%.

It said it expects annual growth to drop to 3% by the end of the year.

Zoopla said other signs of an impending slowdown include the percentage of listings to be re-priced increasing from 4.7% in April to 5.1% in May, with an average price reduction of 9%. It also said the average time to secure a sale has increased from 16 to 18 days for three-bedroom homes outside London.

The index said new supply is seven per cent up on the five-year average.

See also>> Residential construction sees year-on-year decline in April

See also>> Briefing: how Octopus plans to get its tentacles into affordable housing

A Zoopla spokesperson said: “The housing market is still much busier than pre-pandemic norms, but signs are emerging that a slowdown is coming.”

The latest Office for National Statistics figures on house prices also showed a slight slowdown in house price growth. The figures showed a 9.8% annual increase in March, compared to 11.3% and 10.4% in February and January respectively.