Record asking prices driven by pent-up demand
The average asking price for properties listed for sale has reached an all-time high of £375,131, marking a 0.8% increase (+£2,807) this month. This rise is attributed to the ongoing momentum of the Spring selling season, which is putting slight upward pressure on prices. Despite this increase, the market remains sensitive to price changes, with average asking prices only 0.6% higher than they were a year ago.
Top-of-the-Ladder Sector Leads the Growth
Price growth is most pronounced in the top-of-the-ladder sector, where the average prices have risen by 1.3% compared to last year.
Pent-Up Demand Fuels Market Activity
The market is seeing increased activity from prospective buyers who had put their plans on hold last year. This resurgence in demand is happening even as mortgage rates stay higher for longer than expected. During the first four months of this year, the number of sales agreements has risen by 17% compared to last year, surpassing the 12% increase in the number of new listings.
Challenges with Transaction Times
Despite these positive indicators suggesting higher transaction levels for the year, the lengthy average of 154 days from agreeing a sale to legal completion remains a significant challenge for both agents and movers. On average, it takes 62 days to find a buyer before the legal process even begins. As a result, sellers hoping to move into a new home by Christmas should start the process now.
Pricing Strategies for Faster Sales
Rightmove’s analysis indicates that properties requiring a price reduction take over three times longer to sell than those priced correctly from the start. Sellers who set a realistic asking price initially are more likely to sell quickly.
Monthly Market Insights
This month sees a 0.8% rise (+£2,807) in the average asking price for properties, setting a new record of £375,131. The Spring selling season continues to exert modest upward pressure on prices. May has historically been a strong month for price growth, setting new records in 12 of the past 22 years. The top-of-the-ladder sector leads this growth, with a 1.3% year-over-year increase in prices. However, with only a 0.6% overall increase since the last record in May 2023, it’s clear the market remains highly price-sensitive.
Source:- House Price Index
