The average asking price for homes in the UK reached an all-time high in April, according to the house price index (HPI) figures released by Rightmove, the UK’s largest property website.
The new average – £243,737 – is £1,237 higher than the previous peak recorded in May 2008.
Miles Shipside, director of Rightmove, said: “From a national perspective, it has taken four years for new sellers to pitch their asking prices above their previous record. However, this is not a universal signal of a housing market recovery. The richest seams of housing market activity are concentrated around those with access to cash and finance, with a strong bias to the south and London in particular.”
London recorded an annual increase of 7.9 per cent, followed by East Anglia (6.2 per cent), the south-west (3.9 per cent) and the south-east (3 per cent). The East and West Midlands, Wales and the north have all recorded lower annual increases, while Yorkshire and Humberside and the north-west recorded a fall.
Both London and the south-west have recorded new price peaks this month, surpassing previous records by 2.1 per cent and 2.3 per cent, respectively.
Shipside added:
This is a reflection of the new world where house prices in micro-markets are driven as much by banks’ willingness to lend as by consumers’ desire to buy, making buying aspirations more achievable in the relatively credit-worthy south, and London in particular. Those deciding to sell in the south are looking a lot more confident in their pricing power than their more nervy northern counter-parts.
While there are still micro-market hotspots in the north, there are more negative elements to add in to their moving equation, such as employment prospects and lack of equity. Such factors can undermine, or scupper, prospective buyers’ ability and confidence to buy at inflated prices. More potential buyers in the south have the virtuous circle benefits of less economic stress, greater access to equity making them more appealing to lenders, and consequently more confidence to pay higher prices.
While new sellers in the south are leading the way in terms of price recovery compared to previous peaks, transaction volumes still remain well below pre-credit crunch norms.
Shipside concluded:
Fresh property stock is a bit scarcer this April compared to last, and this is a key factor in providing a price floor for spring prices to springboard from. This is the strongest price-bounce Rightmove has ever recorded for the first four months of the year. New sellers are setting asking-price records in the fresh-stockstarved London and south-west regions, and agents report this is also the case in micro-markets in other regions where a shortage of fresh stock is coinciding with the traditionally more active spring market.
However, local market conditions vary considerably. So, while the overall prospects of a seller achieving a record price are higher in London and the South West, doing your research on your own local micro-market is essential to gauge what type of property is in demand, how quickly it is selling and how close to the asking price is being achieved. Buyers scour the market looking for the best value, and can easily spot properties that are out of line. The tightening of the stamp duty noose will cause some price machinations, especially for the higher priced thresholds where the tax-take really starts to bite.
Rightmove tracked 117,333 asking prices – around 90 per cent of the UK market. The properties were put on sale by estate agents from 11 March to 8 April and advertised on Rightmove.co.uk.