The average price tag on a home increased by just £14 month-on-month in February, according to property portal Rightmove.
Rightmove said it is the smallest increase it has recorded between January and February, in records going back to 2001.
Across Britain, the average asking price for a home in February is £362,452, it said.
Tim Bannister, Rightmove’s director of property science, said: “The big question this month was whether we would see new sellers increasing their asking prices, as has been the yearly norm as we approach the spring selling season.
“This month’s flat average asking price indicates that many sellers are breaking with tradition and showing unseasonal initial pricing restraint.
“In addition to market conditions demanding greater realism on price, we are transitioning into a slower-paced market, where buyers will take longer to find the right property at the right price due to the higher cost of servicing a mortgage.
“There are other indicators that this will be a softer rather than a hard transition despite the turbulence at the end of 2022.
“Homeowners who are coming to market in the upcoming spring season should use their agent’s expertise and get the price right the first time , which can really help to find the right buyer more quickly.”
In London, asking prices rose 2.1 per cent in the month to February and 2.2 per cent over the year. The average asking price of a London home is now £681,823 according to the report.
Table: property asking prices across London in February
London borough |
Average asking price (Feb 2023) |
Monthly change (%) |
Annual change (%) |
Camden |
£1,159,717 |
6.0 |
17.2 |
Barnet |
£706,572 |
0.2 |
8.0 |
Islington |
£803,471 |
3.8 |
7.7 |
Haringey |
£670,862 |
0.4 |
7.1 |
Sutton |
£544.880 |
3.1 |
6.0 |
Bexley |
£480,386 |
0.3 |
5.7 |
Hillingdon |
£558,933 |
1.7 |
5.7 |
Enfield |
£506,724 |
-1.2 |
4.8 |
Wandsworth |
£842,845 |
3.1 |
4.7 |
Hounslow |
£596,175 |
-1.6 |
4.4 |
Hackney |
£680,403 |
-1.5 |
4.1 |
Havering |
£476,501 |
0.2 |
4.1 |
Waltham Forest |
£553,077 |
-0.2 |
4.0 |
Tower Hamlets |
£590,726 |
-1.0 |
3.9 |
Hammersmith and Fulham |
£976,058 |
0.2 |
3.8 |
Kingston upon Thames |
£691,675 |
-0.4 |
3.7 |
Southwark |
£663,409 |
0.6 |
2.9 |
Barking and Dagenham |
£371,398 |
-0.6 |
2.7 |
Harrow |
£614,102 |
0.1 |
2.7 |
Croydon |
£485,253 |
0.2 |
2.6 |
Merton |
£695,628 |
-2.3 |
1.9 |
Ealing |
£603,703 |
-0.4 |
1.7 |
Lewisham |
£509,545 |
-0.4 |
1.6 |
Redbridge |
£509,967 |
1.8 |
1.5 |
Bromley |
£619,133 |
-1.3 |
1.4 |
Brent |
£611,326 |
-3.2 |
1.3 |
Newham |
£453,099 |
0.0 |
0.8 |
Westminster |
£1,397,410 |
-2.1 |
0.7 |
Richmond upon Thames |
£894,568 |
-4.2 |
0.6 |
Greenwich |
£476,277 |
-1.2 |
0.4 |
Lambeth |
£660,437 |
0.7 |
0.4 |
Kensington and Chelsea |
£1,647,104 |
1.7 |
-2.2 |
Rightmove said sales in the first-time buyer sector are holding up relatively strongly, suggesting those who are able to move are motivated to agree a purchase, likely driven in part by rising rental prices.
Mortgage rates jumped in the aftermath of the mini-budget, but in recent weeks there have been signs of some rates on fixed-rate deals edging down as the market settles.
Rises in the Bank of England base rate have also been pushing up borrowing costs generally.
Mr Bannister added: “Agents are reporting that they are now increasingly seeing buyers who have more confidence and more choice albeit with revised budgets to accommodate higher mortgage rates.
Some first-time buyers will still be priced out of their original plans and may need to look for a cheaper property, save a bigger deposit, or factor higher monthly mortgage repayments into their budgets
“It’s a positive sign for the market to see many in the first-time buyer sector getting on with their moves, though despite average mortgage rates having edged down, some first-time buyers will still be priced out of their original plans and may need to look for a cheaper property, save a bigger deposit, or factor higher monthly mortgage repayments into their budgets.”
Rightmove’s report quoted Simon Woodcock, managing partner at estate agent Robinson Michael & Jackson in Kent, who said: “We saw an increase in seller activity in January, with first-time buyer properties and your typical three-bedroom family home being the most popular property types coming to market.
“For some, the challenge in 2022 was the lack of properties to buy with demand outstripping supply, and now that the market has moved to a better balance of supply and demand, we are seeing some potential 2022 sellers take the plunge early in 2023.
“First-time buyers were dominant in January, with stabilising prices combined with reducing fixed-rate mortgages making it more affordable to get on the property ladder.
“Sellers are becoming more in tune to the market with those most motivated reducing asking prices to get sold and make their savings on the next purchase.”
Tom Bill, head of UK residential research at estate agent Knight Frank said: “The six weeks since Christmas have been markedly different from the chaotic final three months of last year for the UK property market.
“Buyers and sellers switched off early for the holidays due to the volatility caused by the mini-budget but have come back surprisingly strongly in 2023.
“The crucial difference is stability in the mortgage market, which means plans have been reactivated. The true strength of the market will be put to the test in spring, along with the price expectations of sellers. As budgets come under pressure, we expect prices to fall by around five per cent this year.”
