Rightmove data shows newly-marketed homes pass record £300k

Rightmove data shows newly-marketed homes pass record £300k

The latest report from Rightmove has shown that as demand soars and supply remains tight, the average price of a property coming to market in England and Wales passes £300,000 for the first time.

There are serious challenges facing both first-time buyers and those venturing further up the property ladder as in just 10 years new seller asking prices jump from from £200,980 in March 2006, to £303,190 today.

The price surge is not just restricted to the south according to Rightmove as it has tracked the momentum spreading north and west with six out of ten regions setting record price highs this month. London no longer leads the pack as prices stand still.
 
The mismatch between supply and demand has resulted in six new record highs over the past twelve months in the price of property coming to market. However, this month sees a particularly significant milestone as the average breaks through and beyond the £300,000 mark for the first time. Today’s asking prices are now over 50% higher than they were ten years ago. This highlights the growing housing affordability gap now affecting more and more aspiring first-time buyers and potential trader-uppers.
 
Miles Shipside, Rightmove director and housing market analyst comments: “While the start of 2016 has seen an encouraging but modest uptick in the number of properties coming to market, demand and momentum have combined to push prices over £300,000. On average 30,000 properties have come to market each week over the past month, up by 3% on this time last year, but there are insufficient numbers of newly-listed properties in many parts of the country to meet demand. Visits to the Rightmove website are up by 14% in early March compared to the same period in 2015, so it’s no surprise that those buyers who can borrow more or can find some extra cash are keeping the price merry-go-round spinning, even though increasing numbers of aspiring home-movers cannot afford the ride.”
 
The increasing challenges of both getting onto the ladder and trading up are highlighted by the 50% increase in the price of property coming to market in just 10 years. With that timespan including the period after the credit crunch which saw several years of falling or stagnant property prices, it shows the strength of the recovery for today’s £303,190 average to be over £100,000 higher than the £200,980 of March 2006. In contrast, average wage growth of 22% over the most recent ten years has failed to keep pace with CPI inflation of 26.8%2 which highlights the well-documented issues of raising a deposit and affording a mortgage. The rebound from the housing market downturn has been driven by underlying demand, greater availability mortgage lending, and the economic recovery. The release of this pent-up demand and the shortfall in housing supply are resulting in insufficient availability of affordable stock in many locations.
 
Shipside adds: “More first-time buyers and would-be trader-uppers are finding themselves ill-equipped to cope with current house prices given the tighter lending criteria and average earnings lagging well behind house price growth. However, stronger growth in average earnings would not have helped the situation as it would simply have enabled buyers to bid prices up even higher, chasing the limited supply of suitable housing stock. In last week’s Budget the Chancellor could have encouraged landlords and second home owners to sell their properties and improve supply if he had extended the reduction in Capital Gains Tax to include those transactions. With no other significant property-related new measures in the Budget it at least allows time for his raft of recent initiatives to bed in.”
 
This month’s national average 1.3% jump in the price of property coming to market is the second-highest at this time of year since the 2008 credit crunch. The break through the £300,000 mark is not being driven by London, where prices are at a standstill. Upwards price momentum and stretched affordability are spreading north and west, with six out of ten regions achieving record asking price highs. All four southern regions are joined by the West Midlands and the North West, with the East Midlands being only £373 shy of an all-time high.
 
Shipside observes: “Three out of the top four risers this month are northern regions, with the West Midlands, the North West, and Yorkshire and the Humber being tucked in the slip-stream of the South West and ahead of all the other southern regions. London is a shadow of the former price-rise power-house that has driven up national averages over the last five years, and is now a myriad of different local markets with some boroughs dramatically up or down, but overall cancelling each other out.”
 


Agents’ Views
 
Kevin Shaw, National Sales Director at Leaders commented: “Although stock levels remain historically low across the industry, there has been a significant increase in seller activity levels in the last couple of months. We saw an increase in valuations of 78 per cent last month compared to February 2015 and a record number of new listings in both January and February. Good prices have been achieved, with properties selling quickly, open-house viewings extremely well-attended and multiple offers being received on many homes. We’ve seen a definite surge in house prices at the start of 2016 which is partly expected with the increased demand at this time of year, but has been exacerbated by investors and second-home buyers rushing to complete their property purchases before the additional 3 per cent stamp duty charge takes effect on 1st April.”
 
Nicky Chute from Foxtons in London commented: “Last year the volume of sales fell across all London zones but least so in zones 3-6, whilst prices continued to rise. For example, last year, 514 properties were sold in Pimlico and Westminster with an average price of £1.2m, making the market worth £618m. In Walthamstow, where Foxtons opened a branch in 2015, 1,722 properties sold for an average of £395,000, amounting to £680m in sales. This now makes Walthamstow in Outer London a larger market than Pimlico and Westminster in central London.”
 

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Latest Comments

AbbieP.
AbbieP. 22 Jul 2016

"While house prices in the most expensive eleven boroughs have declined values in the cheapest eleven boroughs continue to rise" - not a nice way to even out the price range. London is overrated as it

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AbbieP.
AbbieP. 21 Jul 2016

And try to profit from your decisions, I may add

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CommercialTrust
CommercialTrust 19 Jul 2016

Retirement investment has always been one of the biggest draws of buy to let. And the buy-to-let demographic is, on balance, older. (Over a third of our applicants are over 50 at the time of application.) It...

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Forrest Wheatey
Forrest Wheatey 11 Jul 2016

I find the time perfect for ever home-owner wannabe. Prices should slowly, but steadily drop, at least for the inner buyer. Making it harder for outsiders to buy properties (the whole Brexit thing means...

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property guru
property guru 11 Jul 2016

Why should Ajay even have to be looking for it. It should be public knowledge. Why is not just publish each years and to were it is and be AUDITED. Accountability.

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property guru
property guru 11 Jul 2016

Surprise suprise

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CommercialTrust
CommercialTrust 30 Jun 2016

This is great news for buyers and investors in a period of significant uncertainty. The 10-year buy-to-let fix at 3.99% in particular is excellent, a clear 100 bps ahead of the nearest competition. Though...

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Lee
Lee 30 Jun 2016

Let's see what happens to north-east property prices when Nissan announce they're leaving.

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DmitriKara
DmitriKara 29 Jun 2016

I just read another article about eviction rising and this was exactly what was on my mind, Housing has become "cat and mouse"...

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DmitriKara
DmitriKara 29 Jun 2016

I am really not surprised. I've seen one too many impudent tenants and in my humble opinion renters have one too many privileges and options to abuse heir landlord in so many ways...

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DmitriKara
DmitriKara 29 Jun 2016

There is still so much uncertainty and I will surely step back and see what's happening before I could make any decisions on my end.

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ChristinaReedUK
ChristinaReedUK 20 Jun 2016

I don't understand why it's always a war between the two sides. Either, way the landlord is probably keeping a detailed inventory and will see the changes you've made. I just don't understand why there...

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