The increase in supply was put down to a spring market boosted by an influx of properties in the rush to sell before Home Information Packs (HIPs). This increase in supply, haart believed, gives buyers more choice and properties that are not competitively priced will not sell.
However, while house prices in London rose for the ninth consecutive month in April, increasing by 0.6 per cent, the figures were slightly down on March’s 1 per cent growth. Prices now stand at £264,636, up from £262,989 in March, as market activity remains strong.
Paul Smith, chief executive of haart, commented: “Confidence in the market remains high despite expectations of a further interest rate rise at the beginning of May. With increasing numbers of sellers putting their property on the market to beat the introduction of Home Information Packs on 1 June, the supply and demand imbalance has been slightly addressed, giving buyers more choice. Although activity levels are high, pushing prices up, this gradual switch to a buyers’ market means that overpriced properties are not selling.
“haart expects the high activity levels to continue throughout May as increasing numbers of properties come onto the market. The two May bank holiday weekends will be particularly busy, with the high levels of property viewings and sales rivalling those of the Easter weekend.”
First-time buyers not returning
The level of first-time buyers has not changed in April, remaining low at 25 per cent of the market share as the group’s struggle to afford the high prices continues.
Smith added: “First-time buyer confidence has certainly not been reinstated this month as affordability remains a problem. It looks almost certain that the Bank of England will decide to raise the interest rate in May and this could cause the first-time buyer level to plummet, damaging market activity.”
London-wide variations
As prices continued to rise across London in April, properties in the South and South Western regions saw the highest percentage asking price discounts and overpriced properties were left unsold due to buyers remaining price sensitive. Properties in the South East have seen the greatest average price increase since April last year, going up in value by over £30,000.
