Three in Five UK Homes Unsold as High Rates Bite

Three out of five homes listed for sale in the UK since January are still on the market, property portal Zoopla said. High mortgage rates have pushed buyers to the sidelines, and some sellers have not adjusted asking prices.

Agreed sales ran 7% below the same period last year. The drop was steeper in Wales, down 12%, and the East Midlands, down 11%. First-time buyers took the hardest hit. A jump in mortgage rates in April, triggered by financial upheaval from the US-Israeli war with Iran, added an average £125 a month to a typical mortgage at its peak compared with January. In London, the extra cost for a first-time buyer reached £232 a month.

The average two-year fixed rate climbed from 4.83% at the start of March to 5.90% on April 12, according to Moneyfacts. It has since eased to 5.54%. That decline has not yet revived demand. Buyer inquiries fell 15% from a year earlier, Zoopla said.

Regional differences are wide. In the north east of England, the mortgage cost increase for first-time buyers was only £66 a month. Northern England and Scotland saw smaller sales declines, partly because fewer homes were listed and the cash impact of higher rates was smaller.