Asking prices in England and Wales hit a record high £313,655 in April while the housing market recorded the best sales figures since 2007, according to the latest index figures.
Overall the price of property coming to market increased by 1.1% or £3,547 last month and is up 2.2% year on year, the figures from property portal Rightmove shows.
Although lower than the average increase of 1.6% at this time of year over the past seven years and with the annual pace now the lowest for four years, average asking prices still reached a new high.
Rightmove says that first time buyers are driving growth, up 6.5% annually to new record of £194,881 and there is strong buyer activity with the number of sales agreed the highest at this time of year since 2007, before the credit crunch.
All regions are experiencing price growth apart from London. The month on month growth was led by Wales with a strong rise of 7.6% and prices up 4% year on year. The strongest annual growth was 5.3% in the East of England.
But in London month on month asking prices fell by 2% to £636,777 and year on year prices in the capital are down by 1.5%, the index also shows with the fall mainly driven by inner London with asking prices down by 4.2% of £35,504, while in outer London they were up 1.7%.
The index shows that it is the top end of the London market that is pulling prices down, down 11.9% month on month and down 7.3% year on year.
But there is considerable variation within London. Month on month prices have increased by 3.9% in Havering and by 3.8% in Redbridge while they were down 31.2% in Camden. Year on year they increased by 14.1% in Westminster and by 11.2% in Haringey but fell by 12% in Camden, by 10.5% in Hounslow and by 10.4% in Kensington and Chelsea.
According to Miles Shipside, Rightmove director and housing market analyst, high buyer demand in most parts of the country has helped to propel the price of newly marketed property to record highs.
‘There are signs of a strong spring market with the number of sales agreed achieved at this time of year being the highest since 2007. It remains to be seen what effect the run-up to the snap election will have, though any slowdown in activity will be counterbalanced by the market’s current fast pace,’ he said.
The analysis of the figures show that in the first time buyer sector of two bedrooms or fewer there are record prices and strong buyer activity, with a 6.5% annual rate of increase. However, this is tempered by a slower pace of increase further up the market, with an overall annual rate of increase of 2.2%, the lowest recorded since April 2013.
Shipside also pointed out that this month’s 1.1% rise is also weaker than the average 1.6% spring boosted surge of the last seven years. ‘Increasingly stretched buyer affordability will continue to be a price moderator for sellers who are over ambitious with their pricing, tempering the pace of price rises,’ he explained.
He also pointed out that strong buyer activity has led to 10% higher numbers of sales agreed than in the same period in 2016. ‘This large year on year disparity should be viewed cautiously as the comparable timespan in 2016 saw a drop in buy to let activity with the additional second home stamp duty,’ Shipside said.
‘However, they are also up by 3.8% when compared to 2015. With the growth in household numbers and new build supply struggling to keep pace, demand is strong and has led to the highest sales agreed numbers at this time of year since the heady pre-credit-crunch levels,’ he added.
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