The average asking price has topped £350,000 for the first time ever, according to property portal Rightmove. It now stands at £354,564, having jumped another 1.7% in the last month. This is the largest monthly rise we have seen for March since 2004 and means average asking prices have risen by more than 10% across the UK over the past year.
Data from Rightmove shows unprecedented conditions, with twice as many buyers as sellers, which is making the housing market fiercely competitive. Indeed, the chance of finding a buyer in the first week of listing a property is twice as likely as it was in 2019, with more than 1 in 5 (22%) properties going under offer within 7 days.
What is happening to house prices?
The property market has been incredibly active since it reopened in June 2020, following the first lockdown. At this point, the government introduced measures to stimulate the sector, including a suspension of stamp duty on the first £500,000 of a property's value. This led to a surge in house prices and, although the tax relief has now come to an end, there still seems to be residual heat in the market. This is being driven, in part, by the disconnection between supply and demand, as well as buyers and movers making the most of low mortgage rates before interest-rate rises start filtering through.
It is worth noting that the Righmove figures cover asking prices and don't always accurately reflect the prices properties are actually being sold for. Indeed, the latest figures from Land Registry that show the trends in the sold prices for properties across the UK show the average house price was £273,762 in January, which is the most recent data available. According to its statistics, the average house price went up by 9.6% over the preceding 12 months.
For a frequently updated overview of house prices, read our article "What is going to happen to UK house prices?"
Is now a good time to sell?
The figures from Rightmove are compelling, particularly for specific segments of the market, such as properties at the top end of the market with four or more bedrooms, which have risen by 3.8% on average over the past month. The headline figures do, however, mask variations, with properties in London, for example, falling by 0.4% last month and rising by a much more modest 6.4% over the past year. Properties in the capital take 57 days, on average, to sell. This compares with an annual price rise of 14.5% for properties in the South-West of England.
While the conditions for sellers are good at the moment, you need to bear in mind that, unless you are at the top of the chain, you will also be looking to buy another property. This means that, unless you are moving to a different area or type of property, you are likely to also be buying at a proportionately higher rate too, as well as having to move quickly and decisively to secure the best deal.
In terms of mortgages, as we recently reported, a significant number of mortgage products are being pulled by lenders and, overall, rates are edging up, which might make it more difficult to secure sufficient finance to secure your house purchase. As ever, it pays to speak to a good, whole-of-market mortgage broker - we like Habito* - if you are considering buying your first property, moving or remortgaging.
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