'Mini-boom' pushes house prices to new record high: Rightmove

The average asking price of property coming to market in Britain has hit a new record high this month due to an unexpected 'mini-boom', according to the latest Rightmove figures.

Related topics:  Finance News
Rozi Jones
20th July 2020
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"The busy until interrupted spring market has now picked up where it left off and has been accelerated by both time-limited stamp duty holidays and by homeowners reappraising their homes "

The data shows that asking prices are now 2.4% higher than in March pre-lockdown and 3.7% higher than in July 2019.

Last month’s report could only refer to English prices, but Rightmove says there is now sufficient new seller asking price data for Scotland and Wales to restart its national index, and the new all-time high follows on from March’s £312,625 record in the busy market before lockdown.

Its figures also show that year-on-year buyer enquiries are up 75% in Britain since the start of July.

The number of properties coming to market is up by 11.1% this month compared to a year ago, despite Scotland and Wales not contributing for the full period.

44% of new listings that came up for sale in the first month after the English market opened on 13th May have already been marked as sale agreed, compared to 34% for the equivalent dates last year.

Additionally, the number of monthly sales agreed is up 15% in England on last year, and in the five days after the stamp duty announcement it jumped to 35% up on the same days a year ago.

Miles Shipside, director at Rightmove, commented: “The unexpected mini-boom continues to gather momentum as more nations reopen. Overall buyer enquiries are up by an incredible 75% year-on-year in Britain and we expect activity will increase even further as Scotland has not yet been open for a full month, and Wales still has some housing market restrictions in place. The busy until interrupted spring market has now picked up where it left off and has been accelerated by both time-limited stamp duty holidays and by homeowners reappraising their homes and lifestyles because of the lockdown. The strength of buyer demand has contributed to record prices, with the 3.7% annual rate of increase being the highest for over three and a half years. These figures are the earliest indicator of house price trends. They show on average prices gently rising not falling, and this will be reflected in the coming months in other house price reports.

”There is a window of opportunity for sellers to come to market and to find a buyer who is tempted by the stamp duty savings. Although March next year may sound like a long time away, in reality sellers need to find a buyer before Christmas, to allow a further three months for completion of the legal process to beat the deadline. While property is selling much faster than a year ago, it’s important not to over-price and miss this window. It’s still a price sensitive market with buyers having limits on what they are able to borrow, and the uncertain economic outlook making them more cautious.

“While most first-time buyers will not benefit from the stamp duty holiday, as they were already exempt from stamp duty on purchases of up to £300,000, many will benefit from lenders now starting to bring back first-time buyer mortgages for up to 90% of the purchase price. Lower-deposit lending helps to boost buyer activity on the all-important first rung of the ladder, which in turn helps to boost the numbers of second-steppers who are able to trade up, and so also enables others higher up the chain to move.”

Jeremy Leaf, north London estate agent and former RICS residential chairman, added: "Rightmove are confirming what we have been seeing on the ground but with one important difference - in other words, further release of pre-lockdown pent-up demand has been given added impetus by the stamp duty holiday and greater availability of low-deposit mortgages. However, we are also finding that most of the buyers and sellers are telling us they are bringing forward moving decisions so they are not necessarily as many fresh enquiries. We get the impression too that many recognise this may be a relatively short-term surge as government support schemes start to fall away and news about the economy is not very encouraging.

"Looking forward, we don’t expect prices to increase particularly strongly as the number of new listings is also rising, providing more balance between supply and demand. The market remains price-sensitive."

 

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