New price record and best sales since 2007 should mitigate pre-election jitters
- Price of property coming to market hits record high, up 1.1% (+£3,547) to £313,655 this month, though lower than the average increase of 1.6% at this time of year over the past seven years
- Overall annual pace of increase continues to slow, now at 2.2%, the lowest for four years:
- First-time buyer sector is driving growth, up 6.5% annually to new record of £194,881
- Strong buyer activity with the number of sales agreed the highest at this time of year since 2007, before the credit crunch
Overview
The average price of property coming to market has hit a record high. This month’s 1.1% (+£3,547) rise has pushed the national average to £313,655, exceeding the previous high of £310,471 set in June 2016. This has been driven by strong buyer demand, with the highest number of sales agreed at this time of year since 2007, before the credit crunch. While the run-up to an election creates a degree of uncertainty and often a pause in activity, this strong set of figures should help mitigate pre-election jitters.
Miles Shipside, Rightmove director and housing market analyst comments: “High buyer demand in most parts of the country has helped to propel the price of newly marketed property to record highs. There are signs of a strong spring market with the number of sales agreed achieved at this time of year being the highest since 2007. It remains to be seen what effect the run-up to the snap election will have, though any slowdown in activity will be counter-balanced by the market’s current fast pace. Indeed, in locations where choice of suitable property is limited hesitation could mean losing out to others who still decide to act.”
In the first-time buyer sector of two bedrooms or fewer we are seeing record prices and strong buyer activity, with a 6.5% annual rate of increase. However, this is tempered by a slower pace of increase further up the market, with an overall annual rate of increase of 2.2%, the lowest recorded since April 2013. This month’s 1.1% rise is also weaker than the average 1.6% spring-boosted surge of the last seven years.
Shipside notes: “Increasingly stretched buyer affordability will continue to be a price moderator for sellers who are over-ambitious with their pricing, tempering the pace of price rises. Strong buyer activity this month has led to 10% higher numbers of sales agreed than in the same period in 2016. This large year-on-year disparity should be viewed cautiously as the comparable timespan in 2016 saw a drop in buy-to-let activity with the additional second home stamp duty. However, they are also up by 3.8% when compared to 2015. With the growth in household numbers and new-build supply struggling to keep pace, demand is strong and has led to the highest sales agreed numbers at this time of year since the heady pre-credit-crunch levels.”
Agent’s View
Kevin Shaw, national sales director at estate agency Leaders, comments: “Our experience of the market last month very much mirrors the findings of Rightmove’s House Price Index: March saw a record number of new instructions for Leaders and was our second highest month ever for sales agreed. At the same time, with good levels of available stock, we carried out a record number of viewings. The forthcoming election is unlikely to have a significant effect on the buoyancy of the market. The underlying fundamentals are still in place and we are expecting seasonal activity to remain robust as we head into the summer months.”
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