House prices look set to continue climbing through June and July, according to forecasts by Reallymoving.
The website captures the purchase price buyers are planning to pay when they search for conveyancing quotes and other moving-related services on its comparison platform.
Buyers typically search for quotes three months before their purchase completes, which provides an indicator of house price trends over the months ahead.
Based on these searches, Reallymoving expects that house prices are going to fall by 5.8% in May because some of those buyers captured in this month’s data were agreeing purchases before the chancellor announced an extension to the stamp duty holiday in his March 3 Budget.
However, the website forecasts that prices will begin to gather steam again, increasing by 2.9% in June to an average of £311,111, and by a further 3.7% in July to £322,672.
The projections come after backward-looking figures from the Office for National Statistics, which recorded that prices rose by 10.2% in the year to March 2021, marking the highest annual growth rate seen since August 2007.
Reallymoving’s index suggests that prices hit a peak of £343,198 in December as buyers rushed to secure deals ahead of the anticipated end of the stamp duty holiday in March.
The website then tracked prices declining month-on-month in January, February, March, April and May, with the rebound expected to begin in June.
Other indices such as Halifax and Nationwide show annual increases of 8.2% and 7.1% respectively in the year to April, as well as monthly growth following the extension of the stamp duty holiday.
Reallymoving says that despite warnings from agents and surveyors of limited supply, activity remains exceptionally strong with conveyancing quote volumes in April at around 60% higher than normal levels for the time of year.
The website’s figures suggest annual price growth will be 6.5% in June and 7.8% in July.
Chief executive Rob Houghton says: “Looking ahead to the summer we’re continuing to see an exceptionally strong performance from the housing market across the UK, with buyer demand showing no signs of abating.
“A shift in the priorities of homebuyers has resulted in strong demand from equity-rich homebuyers higher up the ladder who, freed from their daily commute, are able to look further afield for a home with the kind of space and location they’ve long dreamed of.
“Backed by lockdown savings and encouraged by rock bottom interest rates, many people are determined to secure a home that meets their new needs, despite fierce competition – and it’s these movers who are driving sharp increases in average prices.
“Despite this, first-time buyers continue to maintain a market share of around 55% – which could rise further now the government-backed 95% loans are available.”
