Home.co.uk
Home.co.uk

News: Demand pushes house prices to record levels

A shortage of sellers and increased demand from buyers pushed the average property asking price up from £196,319 in January to £201,600 this month, according to property website Rightmove.

 

February

January

Average property asking price

£201,600

£196,319

% Change in month

+2.7%

+0.1%

% Change in past year

+4.0%

+3.6%

Monthly index (Jan 2002=100)

164.0

159.7

Overall, the asking price of property rose 2.7% in the past month - the fastest pace of increase for two years. Also, all regions saw prices rise - something that has not happened since May 2004.

However, January’s optimism traditionally sees a significant price rise and annual growth therefore showed a marginal increase from 3.6% to 4%.

Time on the market fell sharply from an average of 94 to 81 days. Agents report that competitively priced property in areas of limited supply is ‘flying off the shelves’ and selling as soon as it comes on the market.

Miles Shipside, Commercial Director of Rightmove commented: "The market’s picked up quickly this year. As a result, properties are selling more quickly and stock levels are declining."

"House prices have stormed through the £200,000 barrier to record levels several months earlier than the market anticipated!"

For the first time in 11 months, all property types saw prices rising. The largest increases are at the lower end of the market as the recovery is driven by growing demand for terraces and flats.

Agents report increasing numbers of first time buyers, partly assisted by parental help with deposits as well as more flexible lending criteria. More activity from buy-to-let investors, and downsizing divorcees are also adding to the activity in this sector.

Miles Shipside added: "Buyers are back, particularly at the lower end of the market. We believe this will lead to further sales as successful sellers move up the property ladder."

"However, sellers must not get too ambitious or the recovery could run out of steam as affordability is over-stretched again."

Back to: News Index