UK Property Asking Price Gap Narrows: What Are the Implications?

The gap between the asking price of homes and the final selling price has shrunk since Labour’s Autumn Budget. On average, homes are now selling for 17.4% less than their original asking price, compared to 20% in September last year.

This means sellers are being more realistic with their prices, and buyers are willing to pay a little more to get a deal over the line. But what does this really mean for those buying and selling homes right now? Let’s break it down.

Good News for Sellers

For sellers, this shift can be seen as a positive. A smaller price gap means properties are selling faster, rather than sitting on the market for months. In places like London, where the gap is just 5.6%, sellers are getting closer to their original asking price.

The market also seems to be more stable. With buyers and sellers finding middle ground, there's less uncertainty. This can help sellers feel more confident when listing their property.

In areas like the South West, where the gap has narrowed from 21.1% to 15.9%, this suggests stronger demand and a better chance of getting a fair price.

Bad News for Sellers

However, not all sellers will be happy. To make sales happen, many have had to drop their asking prices slightly. In some areas, like the North East, sellers are still struggling, with a 29.6% difference between asking and selling prices.

Meanwhile, Scotland has seen its price gap widen, which means sellers there may find it harder to get the price they want.

Good News for Buyers

For buyers, a smaller gap means less risk of overpaying. With sellers being more open to negotiation, buyers can feel more confident about getting a fair deal.

The fact that asking prices have slightly lowered in some areas also makes it easier for first-time buyers to enter the market.

In regions like the South East and South West, where the gap has narrowed the most, buyers may now find homes that are more fairly priced.

Bad News for Buyers

While asking prices have dropped slightly, sold prices have gone up. This means homes are still expensive, just slightly more aligned with reality.

On top of that, the government has decided not to extend stamp duty relief beyond March. From April onwards, buyers will face higher upfront costs, which could make homeownership less affordable.

And in places like London, where the price gap is the smallest, buyers will struggle to negotiate lower prices because demand remains high.

So, What’s Next?

With the price gap closing, the UK housing market is in a more stable place than it was a few months ago. Sellers are adjusting to realistic prices, and buyers are still willing to pay, but affordability is still a challenge, especially with rising costs and the end of stamp duty relief.

Whether you're planning to buy or sell in 2025, now might be a good time to act while the market is still balancing itself out.