"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"
Rightmove's latest report has revealed that the number of sales agreed at this time of year has risen to its highest level since before the financial crisis.
According to the figures, the average price of property coming to market has risen by 1.1%, pushing the national average to £313,655 and exceeding the previous high of £310,471 set in June 2016.
Rightmove said that "this strong set of figures should help mitigate pre-election jitters".
The first-time buyer sector is helping to driving growth, with prices rising by 6.5% annually to new record of £194,881. 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.
Miles Shipside, Rightmove director, had this to say: “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.
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. Strong buyer activity this month 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. 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.”
Brian Murphy, Head of Lending for Mortgage Advice Bureau, added: “The steady rate of house price growth quoted in this month’s figures are in line with market expectations in terms of 2017, and certainly a 2.2% increase in asking prices will be seen by many in the industry as reassuring, given the current political and economic landscape.
It's also encouraging to see a marked increase in activity by first time buyers, as they underpin the rest of the market. No doubt the raft of competitive, low deposit and low interest rates that are currently available coupled with the lack of competition from landlords are contributing factors. The report also suggests that the number of sales agreed in March was higher than the same period last year. Again, this is a healthy indicator given that we observed the buy-to-let spike with attendant rush of activity in Q1 2016. So again, to see that the market is performing over that level this year is encouraging.
Whilst the announcement of a snap Election has caught many by surprise, past experience around the effect of elections on the housing market has been a minor dip in activity in the weeks running up to an election, with activity post the election more than making up for this. Looking at the context of this election and what it is setting out to achieve suggests that, although this may happen again, there are fewer reasons to suspect it will.”