House Price Index
Prices hit record high as properties sell at fastest pace ever recorded
- National average price of property coming to market hits a new all-time high of £327,797, following a 2.1% (+£6,733) monthly jump
- Encouragingly, 145,000 properties were newly marketed this month, but not enough to meet buyer demand:
- Number of sales agreed up by 55% on same period two years ago, reducing the stock of properties that are available to buy to the lowest proportion ever recorded
- Buying frenzy for new stock, with both the average number of days to sell a property reaching its lowest ever level, and the number of houses selling within a week reaching its highest ever level
- Mass market of two- and three-bedroom semi-detached homes selling fastest
- March saw time spent on Rightmove surpass two billion minutes in one month for the first time
- Although some of the froth is likely to come off the market later in the year once some government economic measures end, we expect activity to remain robust for the rest of 2021
A monthly price surge of 2.1% (+£6,733) has propelled new seller asking prices to a new record high, with the national average now standing at £327,797. This figure shatters the previous record, set in October last year, by over £4,000. The big jump comes as buyer demand sets another new record, chasing the lowest ever proportion of property available to buy. This is now the fastest-selling market that Rightmove has measured since our records began.
Tim Bannister, Rightmove’s Director of Property Data comments: “This is only the second time over the past five years that prices have increased by over 2% in a month, so it’s a big jump, especially bearing in mind that the lockdown restrictions are still limiting the population’s movements and activities. The property market has remained fully open, and is fully active to such an extent that frenzied buyer activity has helped to push the average price of property coming to market to an all-time high. The stars have aligned for this spring price surge, with buyers’ new space requirements being part of the constellation alongside cheap mortgages, stamp duty holiday extensions in England and Wales, government support for 95% mortgages and a shortage of suitable property to buy. There’s also growing optimism due to the vaccination roll-out, which is helping drive the momentum for a fresh start in fresh surroundings. It does mean that this spring’s buyers are facing the highest ever property prices, though with properties selling faster in the first two weeks of April than ever previously recorded by Rightmove at an average of just 45 days to be marked by the agent as sold, it seems that those buyers are not deterred. Almost one in four (23%) properties that had a sale agreed in March had been on the market for less than a week, which is also the highest rate that we’ve ever recorded. If you’re looking to buy in the current frenetic market then you need to be on your toes and ready to move more quickly than ever before.”
Two- and three-bedroom semi-detached houses are being snapped up quickest, with 30% of those that are being marked as sold by agents having been on the market for less than a week. This suggests that the surge in activity is now being driven by the mass market where few buyers will be achieving the maximum stamp duty savings. Momentum is being partly driven by the lack of property coming to market over the last few months, which has reduced available stock levels as we move into the spring home-moving season. We can’t compare with the same period a year ago in 2020 when the housing market was effectively suspended, but the number of properties coming to market in the last month is up by a modest 3% on the same period in 2019. This means it has now recovered to normal levels, but it is still massively outpaced by buyer demand. In contrast the number of sales agreed is up by 55% on the same period two years ago, and so the proportion of available property is at its lowest ever recorded by Rightmove. However some of the froth is likely to come off this spring surge later in the year as the challenging economic conditions come to the fore, some of the Government support to individuals and businesses unwinds, and the stamp duty holidays finally end in England and Wales. Nevertheless we expect activity to remain robust for the rest of 2021.
Bannister adds: “The fast pace of the current market means that each week another activity record on Rightmove tumbles. Wednesday 7th April set a record of over 9.3 million visits to Rightmove, and March saw time spent on the site surpass two billion minutes in a month for the first time. This spring surge means that it’s a good time to come to market and achieve a good price and a quick sale, especially if you don’t have an onward purchase. The search for more space and new surroundings is still driving the market, with prices rising for the right property in the right location. Housing market activity remains high in Scotland where there has been no extension to the land and buildings transaction tax holiday which has now come to an end, which suggests that the same could happen when the tax holidays start to come to an end in England and Wales from the end of June. These rising prices will cause some buyer affordability challenges, as mortgage lending criteria are still constrained, and the record low available stock proportion will make it difficult for buyers to find the right property. Being able to act quickly when the right one does come along is vital, so having both a mortgage agreed in principle and your own property already sold subject to contract will help to get you to the front of the queue if you’re looking to buy this spring.”
Richard Freshwater, Director at Cheffins said: “This is the biggest lack of stock we’ve seen on the market for at least the past 20 years. Demand is huge, created by a perfect storm of low interest rates, the stamp duty holiday and changes in people’s working patterns. The dreary five day a week commute for many is now over, and this has led to areas outside of London becoming some of the most in demand. On average, every house we put on the market at the moment sees over 40 requests for viewings, all from buyers who are in the position to move. The amazing thing as well is that this level of interest is throughout the market at all price levels, with demand for large country homes at the same rate as the more affordable, smaller city-based options. As competition is fierce, sealed bids have become the order of the day, with over 25 per cent of sales since February conducted by Cheffins ending up in a best and final offers situation. A good example of this, would be a five bedroom house in Great Shelford, just outside of Cambridge, which saw 27 viewings in just over a week, 12 offers and eventually sold for well over the asking price. Clearly, this level of competition has led to quickly rising prices in the local area and this trend is set to continue throughout the summer months. Many sellers are currently holding fire on putting their houses on the market until they have had their second Covid vaccination, and with this in mind, once the vaccine roll out gets into its later stages I would expect to see a good number of properties hit the market as people look to get on with selling.”
The House Price Index is the largest, most up-to-date monthly sample of residential property asking prices. The index monitors changes in house prices both annually and monthly, providing a comprehensive view on the current state of the property market in England, Scotland and Wales.
Based on circa 95% of newly marketed property, the Rightmove House Price Index is the leading indicator of residential property prices in England, Scotland and Wales.