House prices on the rise again despite mortgage hikes
The average price of property coming to the market for sale has jumped £3,300 to £362,438 this January after two months of falls.
The 0.9% increase in asking prices is the biggest increase at this time of year since 2020, according to property site Rightmove.
However, average asking prices are still £8,720 lower than their peak in October.
Read more: Over 1.4 million households facing mortgage hike
“The seasonal increase in new seller asking prices this January from December is particularly encouraging for movers who are looking for the reassurance of familiar trends and a calmer, more measured market after the rapidly changing and at times chaotic economic climate of the final few months of last year,” Tim Bannister Rightmove’s director of property science.
The number of prospective buyers contacting agents is up 4% compared to the same period in 2019, and up by 55% compared with the two weeks before Christmas, the biggest New Year bounce since 2016 after the extended lull at the end of the year.
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“The early-bird sellers who are already on the market and have priced correctly are likely to reap the benefits of the bounce in buyer activity, while over-valuing sellers may get caught out as property stock builds over the next few weeks and months, and they experience more competition from other better-priced sellers in their area,” Bannister added.
However, buyer demand is down by 36% compared to last year’s busiest ever start to a year, as the market navigates its return to a more normal level of activity.
Read more: UK mortgage approvals at lowest since pandemic
“It will be important for the vast majority of sellers to remember that a drop in your asking price is likely not an actual loss compared with what you paid for it, only a failure to live up to aspirations. Listening to your estate agent’s advice about your hyper-local market and pricing right the first time can avoid a stale sale and the need for even greater reductions later,” Bannister said.
More than 1.4 million households in the UK are facing the prospect of interest rate rises when they renew their fixed rate mortgages in 2023, the Office for National Statistics (ONS) warned.