The number of homes for sale hit a 10-year high in June causing property experts to halve their growth forecast.

Estate agents had an average of 65 homes on their books last month, with sellers waiting over two months on average to secure a buyer, according to Rightmove. The online property portal said it was halving its growth forecast for 2025 from 4pc to 2pc as a result.

The average asking price dropped by £4,531 – or 1.2pc – to £373,709 in July, according to the Rightmove House Price Index. The index measures asking prices, rather than what properties actually sell for.

While there is typically a drop in asking prices at the beginning of the summer, largely due to buyers and sellers being on holiday, this represents the largest seasonal decline since the index began in 2002

The drop was fuelled by slashed asking prices in the capital, with outer London and the city centre seeing a falls of 1.5pc and 2.1pc, respectively.

Despite it being a buyers’ market, there is hope for those looking to sell, as sales agreed were 5pc higher than last year.

It comes after Chancellor Rachel Reeves announced a number of changes to help first-time buyers on to the housing ladder.

She confirmed that the mortgage guarantee scheme, which sees the Government back 95pc mortgages for first-time buyers, would be made permanent. Rule changes recommended by the Bank of England will allow buyers to borrow more, and could see 36,000 more high loan-to-income mortgages a year.

The Bank is expected to cut interest rates, currently 4.25pc, at its next meeting in early August, despite higher-than-expected inflation. Further cuts are still expected for later this year.

This should bring already falling mortgage rates lower. The average two-year fixed residential mortgage rate is 5.04pc, and the average five-year fixed rate is 5.02pc, according to Moneyfacts.

Colleen Babcock, a property expert at Rightmove, said: “The decade-high level of buyer choice means that discerning buyers can quickly spot when a home looks over-priced compared to the many others that may be available in their area.

“It appears that more new sellers are conscious of this and are responding to this high-supply market with stand-out pricing to entice buyers and get their home sold.”

Adrian Anderson of brokerage, Anderson Harris, added: “It has felt like a buyers’ market for quite a while now, and with such a high level of properties for sale, it is not surprising that the asking prices have reduced.

“Temporary cuts in stamp duty in April this year has had a negative impact on property values. Sellers are often over optimistic with their initial asking prices. With the increase in available stock for sale, sellers are having to be more realistic.”

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However, Andrew Goodwin of Oxford Economics said that conditions remain challenging for buyers, and that as a result, house prices are around 10pc overvalued.

He added: “But the situation is gradually improving. As the valuation gap continues to recede, it should broaden the pool of potential buyers and help a gradual recovery in activity and prices take root.”

Earlier this month, Nationwide Building Society, the country’s second-largest lender, said its own price index showed a drop of 0.8pc in June, the biggest monthly fall since November 2022.

Land Registry data showed that the average home in the UK was worth £268,652 in May, up from more than £272,000 in March.

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