Rightmove’s latest data indicates that the UK housing market continues to recover, with asking prices reaching near-record levels in April. This upward trend comes despite recent volatility in the mortgage market, highlighting the resilience of the property sector. The data, which covers the four weeks leading up to mid-April, reveals that the average asking price for properties entering the market rose to £372,324. This figure represents a slight increase of just over 1% from the previous month and is only £570 short of the all-time high recorded in May of the previous year. Rightmove has been tracking these figures since 2001, and this recent growth signals that the market is maintaining its momentum, even in the face of fluctuating mortgage rates.
The driving force behind this rise in asking prices appears to be larger properties, particularly four-bedroom, detached homes, and other sizable houses. These types of properties saw a notable month-on-month price increase of 2.7%, contributing significantly to the overall upward trend in the market. This surge suggests that there is still strong demand for spacious family homes, despite the broader economic uncertainties.
While the market remains influenced by ongoing changes in mortgage rates, the steady rise in asking prices demonstrates that buyer interest is holding firm. This growth in the average asking price, especially for larger homes, reflects the ongoing recovery and stability within the UK housing market.
Tim Bannister, Rightmove’s director of property science innovation, noted that the top-of-the-ladder sector continues to drive pricing activity at the beginning of the year. This segment of the market is typically less affected by higher mortgage rates, as movers in this sector tend to be more equity-rich, which gives them greater flexibility when buying or selling properties.
This data emerges amidst ongoing volatility in the mortgage market. Home loan rates peaked in the summer of 2023, followed by a sharp decline towards the end of the year. However, recent inflation figures have caused a reassessment of the Bank of England’s potential interest rate cuts.
As a result, mortgage rates have risen again since February, reflecting uncertainty in the market. This has influenced the broader housing market, even as the higher-end sector remains relatively stable due to its lessened sensitivity to rate changes.
Last week’s official data revealed that inflation dropped to 3.2% in March, slightly less than anticipated but still at its lowest level in two and a half years.
Rightmove reported that asking prices for properties with up to two bedrooms, typically targeted at first-time buyers, remained almost unchanged month on month, rising by just 0.3%. Meanwhile, three-bedroom and non-detached four-bedroom homes saw a 0.9% increase in asking prices.
On a yearly basis, the average asking price across all property types rose by 1.7%, marking the highest annual rate in 12 months. Rightmove also noted a 12% annual increase in new properties listed for sale, alongside a similar rise in agreed sales, particularly at the higher end of the market.
Kevin Shaw, national sales managing director at Leaders Romans Group, commented that 2024 has seen a positive start with an increase in both property listings and sales. However, he cautioned that sellers still need to be mindful of price sensitivity and manage their expectations accordingly.
The Rightmove house price index is based on data from properties listed through over 13,000 estate agency branches on the platform. This index captures price trends earlier in the sales process compared to other measures. For example, the Nationwide Index reflects prices from mortgages approved during the month, while the official house price index is based on completed transactions.
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