UK property prices hit all-time high
The national average price of properties coming to market in the UK hit an all-time high, Rightmove’s latest house price index revealed, as fierce competition among buyers for the record low number of available properties for sale continues.
The average price rose by 0.3%, or £1,091, this month, to hit £338,462. This new record high is only £15 higher than the record set in July, a sign that prices are now stabilising, the report said.
“It’s to be expected that the astronomic rates of house price growth seen since the introduction of the stamp duty holiday will now start to subside as we approach the final deadline," said managing director of Barrows and Forrester, James Forrester.
"But don’t be fooled into thinking the market will now deflate like a cheap birthday balloon. Buyer demand is extremely high and property prices will remain robust, largely driven by second and third rung buyers upgrading to larger, higher-value homes.”
"Competition among potential buyers to secure their next home is now more than double what it was this time in 2019,” said Tim Bannister, Rightmove’s director of property data.
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“To be in pole-position in the race for the best property you need to have greater buying power than the rest of the field," he said.
"That traditionally would mean deeper pockets to outbid other buyers, but in the most competitive market ever, today’s ‘power buyers’ also need to have already found a buyer for their own property, or to have no need to sell at all.”
He added that "proof that you are mortgage-ready or can splash the cash without needing a mortgage will also help you to get the pick of the housing crop.”
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However this competition from properties is counterbalanced by increasingly stretched buyer affordability, disappearing stamp duty incentives and the summer holiday mini-lull, alongside sluggish price growth in London.
There are early signs of more properties coming to market soon, which may help to slowly rebuild buyer choice.
In the first two weeks of September, the number of new listings was up by 14% compared with the last two weeks of August.
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More choice of properties encourages more owners to come to market if they are looking for an onward purchase, and this greater liquidity is another factor in easing further upwards price pressure.
While five areas of Great Britain (South West, Wales, East Midlands, East of England and South East) have annual price growth in excess of 8%, Greater London has seen better supply of homes for sale than the rest of the country, contributing to a rise of just 0.8%.
"The London market is poised for a strong finish with an abundance of stock now available and a sharp uplift in domestic and foreign demand being driven by pandemic restriction lifting both where the workplace and travel are concerned," said director of Benham and Reeves, Marc von Grundherr.
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