The surge in asking prices for newly listed homes in the UK has eased ahead of an upcoming property tax increase, according to Rightmove's latest survey. The property platform reported that average asking prices rose by 0.5% between January 12 and February 8 to £367,994 ($464,666). This represents a slower increase compared to the 1.7% rise in the previous four weeks and is below the seasonal average.
Year-on-year, prices were up by 1.4%. Rightmove's head of partner marketing, Colleen Babcock, attributed the slowdown to the looming March 31 deadline for the temporary tax break on property purchases in England and Northern Ireland, particularly for cheaper homes and first-time buyers. Babcock cautioned that some buyers might miss the deadline due to a backlog in conveyancing processes and suggested the government consider a short extension.
Despite the price slowdown, market activity remains robust. New property listings increased by 13% from a year ago, buyer demand rose by 8%, and agreed sales climbed by 15%. The housing market gained momentum last year, fueled by expectations of lower borrowing costs. However, the slower pace of interest rate cuts has tempered demand. The Bank of England recently lowered its Bank Rate from 4.75% to 4.5% on February 6 but indicated a cautious approach to future rate changes.
As the tax deadline approaches, the housing market faces uncertainty, balancing strong demand and new supply with concerns over affordability and financial policy shifts. The evolving landscape will likely shape buyer behavior and market trends in the coming months.


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