New high hit for third consecutive month
The price of property coming to market has hit a new record high for the third consecutive month, up by 1.6%, or £5,537, compared to the previous month.
According to the latest Rightmove House Price Index, the average house price in April was £360,101.
This means that properties are now £19,082 more expensive than just three months ago. This price jump is the largest three-month increase that Rightmove has ever recorded since it began tracking this data.
Tim Bannister, director of property data at Rightmove, noted that 2022 has started with price-rise momentum that is even greater than during the stamp-duty-holiday-fuelled market of last year.
He also stated that while house price growth may slow down as affordability constraints and economic headwinds combine, sustained price falls are unlikely due to high buyer demand and limited stock for sale.
“While growing affordability constraints mean that this momentum is not sustainable for the longer term, the high demand from a large number of buyers chasing too few properties for sale has led to a spring price frenzy, hat-trick of record price months, and the largest price increase for a three-month period Rightmove has ever recorded,” Bannister said.
He added that any slowdown will be gradual in coming, and it will be a soft rather than a hard landing.
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Geoff Garrett, director of Henry Dannell, said both buyers and sellers would be well advised “to make hay while the sun is shining” as growing economic headwinds are likely to take their toll further down the line.
“While we don’t expect to see market activity evaporate completely, the growing cost-of-living will be a significant factor in the months to come and as household finances are stretched, it’s likely that prospective buyers will ease off on the sums they’re willing to offer,” he explained. “As a result, sellers will need to realign themselves with these changing market conditions and this will cause the rate of house price growth to cool.”
Meanwhile, Rightmove’s data also showed that 53% of properties are selling at or over the full asking price, again the highest level ever seen.
It further revealed that the number of transactions remains steady, and is 21% higher than the more normal 2019 market.
In addition, it was found that sellers were able to find a buyer quicker than ever at just 33 days – twice as quickly as in the same pre-pandemic period in 2019, when the average time to sell was 67 days.
“Over 125,000 new sellers have taken advantage of the great sellers’ market this month, but more are needed in all areas and in all property sectors to meet high buyer demand,” Bannister said.
Christina Melling, chief executive at digital professional service provider Stipendium, remarked that the “feeding frenzy” comes from second and third rung buyers, saying it is this segment of the market that is driving the unsustainable levels of house price growth seen in recent months.
“Unfortunately, it’s the nation’s first-time buyers who are paying the price and those looking to take that first step are now paying £2,000 more for the pleasure compared to just one month ago. It’s yet another brick in an already substantial financial wall that’s blocking many from realising their dreams of homeownership,” Meiling said.
Rightmove’s House Price Index is compiled from the asking prices of properties coming on to the market via over 13,000 estate agency branches listing on its website. The sample includes up to 200,000 homes each month – representing around 95% of the market, the largest and most up-to-date monthly sample of any house price indicator in the UK.
