Homes are selling faster than ever at record prices
If you’re looking to buy a home right now, you’ll already know how fast the spring housing market is moving. Homes are being snapped up by buyers faster than ever, and twice as quickly as they were in 2019: the last ‘normal’ year for the housing market due to the effects of the pandemic.
This is also the third consecutive month we’ve seen house prices hit a new record high, with the national asking price of a home now reaching £360,101. In London, the average now stands at £667,110. You can check asking prices in your region here.
Our property expert Tim Bannister says prices keep rising because there aren’t enough homes for sale to meet the huge demand from buyers. In addition, the high speed of the market and competition among buyers when making an onward move will be deterring some owners from putting their homes up for sale. This means that more than half of home-sellers are achieving their full asking price, or above, when accepting an offer.
This kind of market can have its advantages, says Tim: “If you can secure both a quick sale and a quick purchase, then it’s a lot less stressful than the uncertainties of a slower market, when finding a buyer for your own home can drag on for months, or not happen at all.”
Over 125,000 new sellers have taken advantage of the great sellers’ market this month, but more are needed in all areas and in all property sectors to meet high buyer demand.
“With three new monthly price records in a row, 2022 has started with price-rise momentum even greater than during the stamp-duty-holiday-fuelled market of last year,” he says.
However, we are starting to see signs that the pace of recent price growth is slowing down.
What does this mean if you’re looking to buy?
Despite this level of competition, there are things you can do to put yourself in a strong position as a buyer. These include getting a mortgage in principle if you’re a first-time buyer, or getting a sale agreed on your current property before you find your next home.
So what’s ahead for the 2022 housing market?
Tim says that although we’ve seen more homes coming to market this spring, demand is still very strong, so we can expect the imbalance between the number of people looking to move, and the number of properties available to buy, to continue.
While there are signs that the recent increase in asking prices is slowing down, we’re unlikely to see sustained price falls, due to the high levels of demand from buyers, he adds.
But there are economic factors, including increases in the cost of living and interest rate rises, that buyers will take into account when considering if they can move, and the home they’re moving to. This, coupled with the shortage of homes for sale, will contribute to a slowdown in price growth in the second half of the year.
“We also expect some month-on-month price decreases in July and August, and in November and December, but that’s what we would see in any normal year given the seasonal nature of the market, so it’s nothing out of the ordinary,” adds Tim Bannister.
The slowdown in price growth supports our 2022 housing market forecast of average asking prices rising by 5% over the course of this year.
READ MORE: How to get your home ready to sell