(Bloomberg) — British home sellers posted the lowest profits in more than a decade last year as high interest rates and cost-of-living pressures sapped demand.
Most read from Bloomberg
The average gross profit on a sale in England and Wales was £91,820 ($112,929) in 2024, or 42%, according to a report by estate agent Hamptons International. That represents an 11% drop from £102,650 a year earlier, showing how discounts are hurting profits.
“Families have been hit by higher mortgage and transaction costs, such as stamp duty, making it more expensive to move,” said Aneisha Beveridge, head of research at Hamptons. “Until real estate prices recover, or transaction and mortgage costs decline, homeowners are likely to stay put longer.”
The UK housing market has endured a challenging 2024 as higher mortgage rates reduced competition for homes and limited sellers’ ability to raise asking prices. A pullback in rate cuts pushed the five-year swap rate to its highest level since May last week, raising the prospect that home loan costs will rise again.
The average seller in England and Wales saw profits decline by 48% by 2023, according to Hamptons. The decline was most pronounced in London, where high transaction costs and weak house price growth mean people don’t move as often.
Only 25% of London home sellers had bought and sold within five years by 2024, compared to 34% of sellers nationally. The average London seller made a profit of £172,350 last year, roughly £32,000 less than in 2023. This is the first time in nine years that profits in the capital have fallen below £200,000.
Regardless, 91% of households in England and Wales sold their homes for a profit by 2024, with almost a third making a six-figure profit. A separate Hamptons report published in November predicted house prices will rise 3% across Britain this year, followed by 3.5% growth in 2026.
These gains are believed to be partly due to a prolonged slump in housing construction, putting pressure on supply and keeping prices high. This makes it more difficult for potential buyers to enter the housing market, causing more Britons to rent.
“Homeowners have to inject thousands of pounds from their own pockets to make a move financially viable,” said Hamptons’ Beveridge. This often “smothers a lot of potential sales,” she added.
Most read from Bloomberg Businessweek
©2025 BloombergLP
