House prices in England rose by 5.5 per cent on an annual basis this October – the biggest rate of increase in over four years, according to Rightmove.
This means that the average house price is now £323,530 – or £16,818 more than in October 2019.
Rightmove says that three new records were formed during what is describes as a period of “extraordinary momentum” in the housing market: the average time to sell is now 50 days, estate agents have more properties marked as sold than the number up for sale for the first time ever, and the number of sales reported is at a new high– 70 per cent up on last year.
The rate of growth in the residential market is expected to slow as the year ends, but Rightmove still forecasts house prices to peak in December, “at around 7 per cent higher than a year ago,” according to director of property data Tim Bannister.
He adds: “Many buyers seem willing to pay record prices for properties that fit their changed post-lockdown needs, though agents are commenting that some owners’ price expectations are now getting too optimistic, and not all properties fit the must-have template that buyers are now seeking.”
Bannister continues: “Prospective buyers are seeing properties selling fast and prices rising as they search for their next home, adding to momentum and spurring them on to act quickly. With the number of buyers contacting agents still up by two-thirds on a year ago, there is plenty of fuel left in the tank to drive further activity in the run-up to Christmas and into next year.
“There have also been government promises of additional low-deposit mortgage support for first-time buyers, which could prove to be timely as we run up to 31 March,” he concludes.
MT Finance director Tomer Aboody says: “This current boom is a good sign, with buyers looking for more space and understanding that it comes at a premium.
“Cheap money, high LTV mortgages, well-capitalised banks happy to lend and plenty of buyer demand are the main reasons for the uptick in sales. There is also a desire to act quickly before a potential widespread deterioration in people’s credit ratings due to looming uncertainty over job security caused by the pandemic.
“The market will need further assistance and hopefully encouragement from government to offer higher LTVs will have a real positive impact, along with any potential further extension to the Stamp Duty break.”
