Bigger than usual New Year bounce recorded this year
House prices recovered this month after consecutive monthly price falls were recorded at the end of 2022.
According to the latest Rightmove House Price Index, average new seller asking prices rose again by 0.9% to £362,438 in January. This amounts to an increase of £3,301 in asking prices – the biggest rise at this time of year since 2020.
The number of prospective buyers contacting agents is also up 4% compared to the same period in 2019, and up by 55% compared with the two weeks before Christmas, the biggest New Year bounce since 2016 after the extended lull at the end of the year.
However, the property listing platform also reported that average asking prices are still £8,720 lower than their peak in October. The number of enquirers is also down by a third compared to the buoyant market of this time last year, Rightmove noted.
“The seasonal increase in new seller asking prices this January from December is particularly encouraging for movers who are looking for the reassurance of familiar trends and a calmer, more measured market after the rapidly changing and at times chaotic economic climate of the final few months of last year,” Tim Bannister, director of property science at Rightmove, said.
“These statistics, based on the largest sample of any UK housing report, give reasons for some positivity at the beginning of 2023. The numbers certainly suggest that activity has bounced back after Christmas and agents will now be busy trying to match the likely revised expectations of buyers and sellers as we move towards the important spring season.
“We expect that the full effect of affordability constraints and last year’s mortgage rate rises will hold back some segments of the market in the first half of the year, but our leading market indicators may start to identify some green shoots of growth that will go on to strengthen in the second half of 2023.”
Gareth Overton, head of residential sales at Henry Adams, shared that along with increases in viewing levels seen so far this year, they are also receiving more requests for valuations.
“This bodes well for a reasonably balanced market in the months ahead, where supply and demand are more evenly matched,” he commented.
Simon McCulloch, chief commercial and growth officer at Smoove, agreed that the jump in house prices and rising interest among prospective buyers signals an encouraging start to the year for the housing market, after the tumultuous closing months of 2022.
“While demand may be dampened in the coming months by any further Bank of England base rate hikes, the positive signs in the market as we move through January are very welcome,” McCulloch remarked.
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