Average asking prices for homes newly listed on the UK market fell 2.0% this month to £364,999 — the steepest August decline since 2018 — according to Rightmove data reported by Financial Reporter and London Insider on 17 August 2026. The same week, HMRC figures analysed by Bowmore Wealth Group showed the number of UK residential properties sold by overseas individuals fell almost 9% to 16,520 in the year to 5 April 2026, down from 18,100 the year before, according to reporting by The Intermediary. Both signals point toward a market losing momentum ahead of the new Chancellor’s first Budget in October — though, as the detail below shows, they are not being driven by quite the same forces.
Asking Prices Post Their Sharpest August Fall Since 2018
Rightmove’s own reporting attributes the size of the August fall largely to supply: the number of homes for sale is at a 12-year high for this time of year, which, combined with the traditionally quiet summer period, pushed many sellers to list at more competitive asking prices. Average asking prices are now down 1% year-on-year — the largest annual fall recorded since December 2023. The picture varies sharply by region: prices in northern England rose 1.5% year-on-year and Scotland also increased, while southern England fell 1.8% and London recorded the steepest decline of any part of Great Britain, down 3.1%.
London’s fall came despite — or perhaps because of — a 16-year high in the number of homes available for sale in the capital. Rightmove also flagged affordability pressure: an average London home costs around 17 times the national average annual wage, and the average two-year fixed mortgage rate has risen to 5.09%, up from 4.92% the previous month. Citing this mortgage-rate path together with “geopolitical uncertainty” and the new Chancellor’s first Budget in October, Rightmove downgraded its full-year 2026 price forecast from 2% growth to a range of 0% to -2%.
Overseas Sellers Are Pulling Back — For a Different Reason
The overseas-sales figures come from a separate data source: HMRC records provided to and analysed by Bowmore Wealth Group. Non-resident individuals sold 16,520 UK residential properties in the year to 5 April 2026, down from 18,100 the year before — a fall of almost 9%. At the top end of the market, only 70 non-resident owners sold UK properties worth more than £5 million in the year, compared with 80 the year before.
Bowmore’s own explanation for the pullback is not centred on Budget-related tax fears: the wealth manager points to already-rising taxation on buy-to-let investment and the new Renters’ Rights Act, which it says have made UK residential property a less attractive asset for both overseas and domestic landlords. David Floyd, head of private clients at Bowmore Financial Planning, is quoted saying net rental yields in London are “around 2%” against a “risk free 4.6%” available on five-year UK government bonds, and that the administrative burden of being a landlord has been compounded by the new Renters’ Rights Act. In other words, the reported driver behind fewer overseas sales is landlord economics and tax changes already in effect — not primarily anticipation of the October Budget.
Where the Two Threads Connect — and Where the Evidence Diverges
The direct link between these threads and “Budget tax fears” comes from a third, separately attributed voice. Tom Bill, head of UK residential research at Knight Frank, said: “Rising mortgage rates and uncertainty around tax rises in the Budget are curbing demand, which is being felt more acutely in parts of the country where affordability is already stretched.” That is a specific, named claim about Budget-linked demand suppression — but it describes the broader UK buyer pool Knight Frank tracks, not the overseas-seller data reported separately by Bowmore.
There is also a genuine tension inside Rightmove’s own release. The portal reported a “mini Burnham bounce” — a 5% rise in buyer demand since the new Prime Minister took office on 20 July — which it linked to Mr Burnham ruling out property tax changes in the October Budget. That runs the opposite way to Mr Bill’s demand-curbing narrative: in Rightmove’s own account, removing one specific property-tax threat lifted near-term demand, even as broader Budget uncertainty over other taxes — cited by both Rightmove and Knight Frank — continues to weigh on the outlook for the rest of the year. Read together, the three threads describe a market where a price correction already under way (driven mainly by a supply glut) and a separate, tax-economics-driven retreat by overseas sellers are both unfolding in the same window as Budget-related uncertainty — but the reporting does not support treating Budget tax fears as the single cause of either the price fall or the overseas-seller pullback.
Zagdim’s View — For international buyers watching the UK market, the practical read is that two distinct signals are cooling at once, for two different reasons: domestic asking prices are correcting on a supply glut and stretched affordability, while overseas sellers are retreating mainly on landlord-specific tax economics that predate this particular Budget cycle. Both trends sit inside a market that Rightmove itself describes as difficult to forecast until the Chancellor’s October Budget clarifies what, if anything, changes for property taxation.
Event and data status as of 17 August 2026.
References
Rightmove – August 2026 House Price Index, as reported by Financial Reporter / Rightmove – August 2026 House Price Index, with Knight Frank commentary, as reported by London Insider / Bowmore Wealth Group – HMRC overseas-seller sales data, as reported by The Intermediary
