House prices in the UK rose by 8.2% on an annual basis in August, says Zoopla – a £19,650 jump over the year.

However, the housing market is slowing, says Zoopla, likely soon turning from a sellers’ market to one that favours buyers, “as higher mortgage rates are set to cut buying power by up to 28%”.

This calculation is contingent on mortgage rates rising from 2% to 5% and borrowers wishing to keep their monthly repayments unchanged.

The report also shows that 6% of homes listed for sale have now had their asking prices reduced by 5% or more, the highest this metric has been since before the pandemic, “although re-pricing is a common seasonal trend as we enter the autumn market,” it adds.

While limited property supply and continuing demand don’t presage any big price falls, Zoopla says, it does expect price growth to slow “more rapidly” for the remainder of this year and into the next.

Indeed, Rightmove housing expert Tim Bannister says: “The number of potential buyers requesting to view properties on Monday and Tuesday was down 3% compared with other Mondays and Tuesdays this month, and demand is still significantly higher than the supply of homes for sale.

“Also, the number of sales being agreed on Tuesday was at its highest number in a day since early August, perhaps as some people rush to get a mortgage before rates rise further.

“Over the past month activity has shown that the housing market has been surprisingly resilient against headwinds of rising rates and so it looks as though for those who can move, they’re going ahead for now.

“We’ve seen demand softening in the past few months, but buyer demand is still 20% higher than the pre-pandemic five-year average, house prices are 15% higher than they were two years ago, and the overall number of homes going through conveyancing is 40% higher than in 2019.”

Meanwhile, Hargreaves Lansdown senior personal finance analyst Sarah Coles says: “When the dust settles on the chaos in the mortgage market, the ground will have shifted, and fixed rates will have risen significantly.

“The impact on buying power will mean some incredibly difficult decisions for homebuyers, who could end up with smaller ambitions or horribly tight budgets. This is going to take a toll on the market.

“With all the factors conspiring against buyers at the moment, it’s difficult to see how house prices won’t soften from here. We are already seeing the first analysts forecasting price falls, and the risks of a correction have increased.”