The average asking price rose by 2.9 per cent year on year to reach £309,399 in February, which was just £40 short of a new all-time high, according to Rightmove.
On a monthly basis prices rose by 0.8 per cent or £2,589, taking them close to the previous record set in June 2018.
The number of new buyers registering their interest outstripped the increase in new seller, putting upwards pressure on prices.
However, seller numbers were still 2.1 per cent higher than a year ago with over 110,000 homes coming to market – the first annual rise in supply for 13 months.
The property portal reports that its traffic rose by 7.2 per cent to 152m visits in January and the number of sales agreed rose by 12.3 per cent nationally and by 26.4 per cent in London.
Rightmove director and housing market analyst Miles Shipside says: “There is a boom in buyer activity outstripping the rise in the number of new sellers, which we expect to lead to a series of new price records starting next month.
“This means that spring buyers are likely to be faced with the highest average asking prices ever seen in Britain.
“Buyers who had been hesitating and waiting for the greater political certainty following the election outcome may be paying a higher price, but they can now jump into the spring market with renewed confidence.
“ After three and a half years of Brexit uncertainty, dither, and delay, many now seem to have the 2020 vision that this is the year to satisfy their pent-up housing needs.”
But he adds: “Sellers should be careful not to get carried away with their pricing, as this is still a price-sensitive market with stretched buyer affordability.
“Those who over-price risk missing out on the window of increased activity that could run at least until we approach the next Brexit deadline at the end of the year.”
Savills head of residential research Lucian Cook says: “Since the election we’ve certainly seen a significant uptick in new buyer demand in the prime market which creates a real opportunity for sellers while stock for sale remains relatively low.”
But he says: “Our own agents are reporting that the vast majority of buyers remain unwilling to increase their budgets.
“Accordingly, our advice remains that sellers need to remain pragmatic on price, particularly given some of the uncertainty around an impending budget, the first of the new Government.”
Heaton & Partners founder and managing partner Edward Heaton says: “The hype of a ‘Boris Bounce’ – which was building for some time – immediately reinvigorated many of our clients purchasing plans.
“In an uncertain world, certainty suddenly seemed to have been restored.
“I would expect any house price rises we’ve seen in January to flatten by the latter part of the year, as attention will inevitably turn to ‘Deal or No Deal’.
“Trade negotiations will unavoidably affect market confidence – both in attracting foreign investors and housebuilders who rely on European materials.”
MT Finance director Tomer Aboody says: “Next month’s Budget will be an interesting one with regards to possible changes to stamp duty.
“If the new Chancellor is brave enough to cut stamp duty, it will give the market a boost, encourage downsizers to sell up and persuade more buyers to take advantage of low mortgage rates and get on with a purchase.”
