Property asking prices rise for second month in a row, says Rightmove – as buyers get back in the game

Average asking prices rose by 0.9 per cent this month to £362,839, according to the latest data from Rightmove.

The data, which looks at the prices of newly-listed homes, reported a 1.3 per cent rise in January. This means the typical asking price has risen by almost £8,000 since December.

It was also up 0.1 per cent up on this time last year – which is the first time in six months that the year-to-date figure hasn’t been negative.

The change was driven by more buyers and sellers coming to market, according to the property website. 

Strong start to the year: The typical newly-listed home has risen by almost £8,000 since December, according to Rightmove

It reported 7 per cent more new listings coming to market this February than last year, and a 7 per cent upturn in the number of buyers enquiring. 

It also said agreed sales in the first six weeks of 2024 were 16 per cent higher than over the same period last year, and 3 per cent higher than pre-pandemic in 2019.

Rival website Zoopla is reporting similar findings in its data. It said home buyer demand in January was running 12 per cent higher than the same time time last year.

Where are the hot housing markets? 

Rightmove said that buyer numbers were up across all parts of the UK, but London was firmly out in front, followed by the North East and North West regions.

It also said the flow of new homes for sale was 10 per cent higher than a year ago and the highest it has been since 2020.

It reported that new sellers are listing their homes at the fastest pace in the East of England, the South West and North East.

On the ground, estate agents are also backing up these findings, with many reporting positive starts to the year.

Michelle Niziol, chief executive at IMS Property Group in Oxfordshire said: ‘The start of this year has seen renewed optimism and positive sentiment in the wake of a further pause in interest rates and January inflation held at 4 per cent.

‘Optimism breeds confidence, and confidence is translating into more sellers and buyers coming into the market.’

The average newly listed property is 0.1 per cent up on this time last year – which is the first time in six months that the year-to-date figure hasn’t been negative

Kate Eales, deputy head of residential at estate agent Strutt & Parker adds: ‘We are witnessing a good start to the year in London’s property market, with buyers acting earlier than usual.

‘The current momentum is further underscored by an increase in registered buyers year-to-date compared to the same period last year.

‘This positive trend suggests a renewed confidence in the market, and as we move into spring, we anticipate a continued upward trajectory in both buyer interest and property transactions.’

February’s data follows on from Rightmove reporting last week that a record number of homeowners contacted an estate agent to get their home valued in January.

Meanwhile, the latest property market survey by the Royal Institution of Chartered Surveyors (Rics) also showed that estate agents and surveyors are seeing rising numbers of buyer enquiries as well as more sellers coming to market.

Tim Bannister, director of property science at Rightmove said: ‘We said that February would be an important indicator for the year ahead, and the question was whether the Rightmove Boxing Day bounce in buyer activity would keep its spring into March or lose momentum.

‘It’s proved to be the former, with the number of sales agreed continuing to considerably outstrip last year.

‘Early-bird Boxing Day buyers got a head start in cherry picking from a record level of new property choice and have now been joined by many other buyers also believing that 2024 offers the right market conditions to move.’

Bannister is one of many experts across the property industry that believe mortgage rates have now reached low enough levels to encourage buyers and home movers back into the market.

Although average two-year and five-year fixed mortgage rates remain above 5 per cent, according to Moneyfacts, the cheapest five-year fixed deals for those with more equity remain just below 4 per cent.

Falling rates: Experts across the property industry that believe mortgage rates have now reached low enough levels to encourage buyers and home movers back into the market

The lowest rate for someone buying with a 20 per cent deposit is currently 4.34 per cent, while the lowest rate for someone buying with a 10 per cent deposit is 4.47 per cent.

Someone requiring a £200,000 mortgage, buying with 10 per cent deposit and securing the lowest rate on a term of 25 years, could expect to pay £1,108 a month.

‘Mortgage rates have fallen considerably from their peak and are now remaining broadly stable after the uncertainty of late 2022 and 2023,’ adds Bannister. ‘Momentum to move in 2024 is continuing to build.’

Are home sellers pricing too high? 

However, while the property market appears to be warming up, many sellers may be pricing their homes a little over optimistically, meaning many homes are failing to attract interest.

It’s taking more than two weeks longer to find a buyer than at this time last year, with the average time to sell at its slowest since 2015, excluding the initial pandemic lockdown months of April and May 2020.

Sellers are being advised to price correctly from the start if they want to sell quickly.

‘Prospective sellers mustn’t get carried away,’ says Bannister. ‘Buyers now have more choice of property for sale and many are still very price-sensitive, with mortgage rates remaining elevated.

‘Sellers who are serious about moving this year would be well-advised to ride this wave of increased buyer confidence with an attractive asking price before any pre-election jitters or unexpected events dampen the momentum.’

Rightmove says that estate agents are reporting properties that are competitively priced are being snapped up by budget-conscious buyers who are keen to make 2024 their year to move, having paused during the uncertainty of 2023.

If they are overpriced, however, they are likely to linger on the market and require the asking price to be slashed.

It’s taking more than two weeks longer to find a buyer than at this time last year, with the average time to sell at its slowest since 2015

Fellow agents Hamptons revealed earlier this week that a huge 48 per cent of homes sold in January across England and Wales had been subject to a price reduction.

Michelle Niziol of IMS Property Group said: ‘The market remains price sensitive.

‘Motivated sellers need to be realistic with listing prices and take advice on how to effectively position their sale in the current market.

‘Buyer’s budgets are still being largely constrained by expensive mortgage products, so it’s a careful balance.’

Reginal differences: Average asking prices rose this month in every UK region. However, in some locations the average new listing is still priced below what it was last year

This post first appeared on Dailymail.co.uk