Home searches hit a one-year high as UK house price growth slows

For Malaysian buyers and investors keeping an eye on the UK property market, August brought an interesting shift. More people are actively looking for homes, yet prices are no longer rising at the pace seen earlier in the year.

According to Zoopla, UK home searches were 7% higher than a year ago, marking their highest level in the past 12 months. At the same time, annual house price growth slowed to 0.9%, down from 1.3% the previous month.’

For overseas buyers, this combination is worth watching. Rising interest in property alongside slower price growth could give buyers more room to research, negotiate and consider different locations before making a decision.

More choice for buyers, but borrowing remains expensive

The number of homes available for sale increased by 5% year-on-year, reaching a 12-year high. More properties coming onto the market means buyers have a wider selection, while sellers face greater competition to attract serious offers.

However, financing remains an important consideration. The average two-year fixed mortgage rate rose above 5%, reaching 5.09%, compared with 4.95% previously.

For Malaysian investors purchasing with financing, this makes it particularly important to look beyond the headline property price. Mortgage costs, taxes, service charges, management costs and potential rental income all need to be considered when assessing whether a property works financially.

The average UK property price stood at £364,999 in August, while the London average was £646,541.

London prices soften, but some boroughs remain resilient

London saw some of the biggest price adjustments, with average prices falling 3.1% year-on-year. That does not necessarily mean every part of the capital is moving in the same direction.

Some boroughs continued to show modest monthly growth. Tower Hamlets recorded a 0.7% increase, followed by Newham at 0.4%, Hillingdon at 0.2% and Hackney at 0.1%.

For Malaysian buyers, this is a useful reminder that the London market cannot be viewed as one single market. Location, transport links, regeneration, housing demand and the type of property can all influence how an area performs.

What does this mean for Malaysian buyers?

The current market could be an opportunity to take a more considered approach rather than rushing because prices are moving quickly.

Having more properties on the market gives buyers more choice, while slower price growth may also leave a little more room for negotiation. For investors, though, it is still important to look beyond the asking price and consider the bigger picture, such as the property’s location, rental demand, ongoing costs and whether it is likely to remain appealing over the long term.

Tax considerations are equally important for overseas buyers. While there has been speculation around possible changes to property taxes, the government has indicated that no major changes are expected in the upcoming Autumn Budget. Any final announcements should still be checked before making a purchase.

Benham and Reeves: Helping Malaysian buyers navigate the UK market

Our Malaysia office recently hosted a successful showcase of apartments and townhouses in Cambridge, allowing local buyers to explore the UK property market from closer to home.

With more property events taking place in the coming months, Malaysian buyers can speak directly with our property experts about buying, investing in, selling or letting property in the UK.

Whether you are considering London or looking beyond the capital, understanding the market is the first step towards making a well-informed property decision.