House price growth also slowed to 0.8% – the lowest level in more than two years since July 2024, the property website’s data showed.
But, with average mortgage interest rates now above 5% at 5.2% – a three-year high, and up from 4% at the start of the year – the average homebuyer now faces an extra £150 a month (£1,800 a year) in mortgage repayments.
Higher purchasing costs are impacting demand with lower agreed sales in every UK region and country.
Zoopla said a quarter of the homes listed in September were “relisted” properties that had previously been on the market. Of these, six out of 10 were returning with a lower asking price.
Relistings were more common among condos and larger homes, which generally took longer to find buyers.
In London, a third of flats on the market have already been listed, compared to less than one in 10 in Scotland.
This creates opportunities for buyers because it means they have more choices. Zoopla said the number of homes for sale was 5% higher than last year, while agreed sales over the past four weeks were 9% lower.
This imbalance is most evident in London and the south of England, where the number of homes for sale rose by 8% over last year.
Richard Donnell, CEO at Zoopla, said: “The conflict in the Middle East has pushed up energy prices and mortgage rates, dampening the recovery in housing activity in the fall.
“Borrowing costs are likely to remain high, with house price inflation heading towards 0.5% by the end of the year, and annual sales expected to be closer to 1.1 million versus 1.2 last year.
“Although key measures of housing market activity are lower than last year, there is still a lot of demand for homes. Buyers are simply more cautious and selective about what they view and what they offer.”
“Sellers who take into account local market conditions and seek detailed advice from local estate agents on how to set their asking price can still find a buyer relatively quickly.
“Getting the price right from the start is essential. If you are selling an affordable two or three-bedroom house in the north of England, this is a strong market. The most challenging pricing decisions are faced by sellers of apartments and larger houses throughout the south of England.”
