New record for asking prices

Published on

house-price-graph

Property coming to market this month has set a new record national average asking price, according to the latest Rightmove House Price Index.

This month’s 2.1% (+£5,135) rise has left the national average just shy of a quarter of a million pounds at £249,841, surpassing the previous high by £3,606. London, the South East and East Anglia have also hit all-time highs, with buyers in the capital facing new sellers’ average asking prices in excess of £500,000 for the first time.

Miles Shipside, Rightmove director and housing market analyst said: “The tumbling of records is being driven by the equity-rich generation with a definite southern bias, though agents in most parts of the country are reporting strong demand for well-priced and decent-quality stock. Despite a new national record, it’s not ‘green-shoots of recovery’ across the board, especially for the deposit-strapped mass-market. They must wait patiently until January when the Help to Buy scheme extends to the resale market, unless new homes developers can increase building dramatically this year.”

The average price of property coming to market has risen by 9.1% (+£20,852) so far in 2013, the strongest start to a year since the 10.5% recorded in 2004. This is the fifth monthly rise in a row, with all regions in positive territory this month. However, sellers in two northern regions, Yorkshire & Humberside and the East Midlands, are still unable to come to market at higher prices than this time last year.

With London sprinting past the £500,000 milestone for the first time with a 3.1% monthly rise to £509,870, a typical home in the capital is more than twice as expensive as the national average. Outside London and some southern hotspots agents report that the market remains sensitive to price and quality, with buyers willing to take their time to find their ideal home.

Shipside said: “The recession appears to have precipitated a change in buyer behaviour which has left them more choosy and less willing to settle for second-best. Not only are they looking for value and wary of paying over the odds, prospective buyers are also giving thought to ease of resale, a sign that the pain of this financial crisis has left them more mindful of the liquidity of their assets.”

Lenders are ‘cherry-picking’ in efforts to improve the quality of their future mortgage book by offering some tantalisingly cheap mortgage rates to those with decent deposits, courtesy of the Funding for Lending Scheme. There are fixed rates from 2.34% with a minimum 25% deposit, and even interest only options at 2.19% for those with a 50% deposit of at least £300,000 to put down.

The availability of cheap money is key to driving positive sentiment and, with 84% of respondents to Rightmove’s latest Consumer Confidence Survey stating that they felt prices would be the same or higher in 12 months’ time, this seems to be feeding through to home-movers. However, the pent-up demand is still being frustrated by the restricted supply of fresh property.

Rightmove has recorded 3% fewer properties coming to market when comparing the first five months of 2013 to those of 2012. This helped exert the upwards price pressure resulting in this month’s new record asking price.

COMMENT ON MORTGAGE SOUP

We want to hear from you!
Leave a comment and get the conversation started.
You need to register to post, so please login or sign up below.

Latest articles

HTB completes £6.5m MUFB refinance in 36 hours

Hampshire Trust Bank has completed a £6.5 million refinance on a 63-unit multi-unit freehold...

Aspen Bridging passes £750m lending milestone after record July

Aspen Bridging has passed the £750m total lending milestone following a record-breaking July, with...

Aldermore joins Growth Guarantee Scheme

Aldermore has been accredited by the British Business Bank to offer facilities under the...

Quantum Mortgages refines lending policy to support specialist landlords

Quantum Mortgages has introduced a series of changes to its lending criteria in a...

Paragon Bank appoints BDM for Central region

Paragon Bank has appointed Gary Dean as business development manager for the central England...

Latest publication

Latest opinions

Take off the rose-tinted glasses and stop chasing a rate cut

Every six weeks the financial world raises its eyebrows at the prospect of a...

Job cuts to inflation shock: preparing for a mortgage arrears crisis

The latest data on jobs paints a picture of a rapidly weakening labour market. The...

URGENT! AI Is coming for you. Or maybe not…

I’ll try to make this as straight to the point as I can. The...

Mind the gap: Can mortgage advice change the game for protection?

Many industry insiders still talk about the UK protection gap and how vast it...

Other news

HTB completes £6.5m MUFB refinance in 36 hours

Hampshire Trust Bank has completed a £6.5 million refinance on a 63-unit multi-unit freehold...

Aspen Bridging passes £750m lending milestone after record July

Aspen Bridging has passed the £750m total lending milestone following a record-breaking July, with...

Aldermore joins Growth Guarantee Scheme

Aldermore has been accredited by the British Business Bank to offer facilities under the...