The average asking price for a property in the UK has risen to £371,870 in March, reflecting a busy period in the housing market. This surge comes as many home-seekers rush to complete transactions before the approaching stamp duty deadline, creating significant demand.
According to Rightmove (RMV.L), the average asking price for newly listed properties has increased by 1.1%, equating to a rise of £3,876. This uptick highlights the continued strength of the market despite economic uncertainties and affordability challenges for buyers.
Rightmove’s data also reveals that February and March have historically been the most favourable months for sellers. During this time, a higher percentage of homes successfully find buyers compared to other months of the year, making it an ideal period to list a property.
With the market experiencing heightened activity, sellers may benefit from strong demand, while buyers looking to secure a deal before potential changes in taxation could face increased competition. The coming weeks will determine whether this upward trend in asking prices continues or stabilises.
This year, sellers are facing unprecedented competition as the number of homes coming to market has reached its highest level in a decade. Meanwhile, buyers are benefiting from the best selection of properties since 2015, leading many sellers to adopt a more strategic approach by pricing their homes competitively to stand out.
Colleen Babcock, a property expert at Rightmove, highlighted the importance of smart pricing and presentation for sellers looking to secure a deal. She noted that those successfully finding buyers are working closely with their agents to ensure their homes are marketed effectively in a crowded market.
A key factor driving urgency in the market is the upcoming stamp duty deadline in England. With 575,000 transactions currently in the legal completion process, many buyers are racing to finalise their purchases before the deadline to avoid paying additional taxes. This has led to a surge in activity as cost-conscious buyers push to complete their moves in time.
Rightmove’s data suggests that while many transactions will meet the March 31 cut-off, an estimated 74,000 moves—including 25,000 by first-time buyers—will not be completed in time. These delayed transactions are expected to incur a total of £142 million in extra stamp duty costs, creating financial pressure for those affected.
As the market navigates this period of intense activity, estate agents are working closely with buyers and sellers to manage expectations and mitigate the impact of additional costs. Whether this surge will continue beyond the deadline remains to be seen, but for now, the market remains highly competitive.
Starting from 1 April, the “nil rate” band for first-time buyers will be reduced from £425,000 to £300,000, while for other buyers, it will drop from £250,000 to £125,000. As a result, half of homeowners will face an additional £2,500 in stamp duty costs per purchase, with another third of buyers paying up to this amount. This change is expected to impact affordability, especially for first-time buyers navigating an already challenging market.
With the deadline fast approaching, the possibility of an extension remains uncertain. Hopes for a last-minute policy change are fading, though the upcoming spring statement offers a slim chance of a short extension to assist those facing delays in their transactions. Meanwhile, market activity remains strong, with sales agreed up by 9% compared to the same period in 2024, and new listings 8% higher than last year. This suggests continued confidence in the housing market despite the impending tax changes.
Economic uncertainty, however, is influencing mortgage rates, leading to minor fluctuations on a weekly basis. Buyers with smaller deposits are being hit hardest by these shifts, making it more difficult for first-time buyers and those who need to borrow larger sums. With the next Bank of England interest rate decision approaching, many anticipate a rate hold in March, followed by a potential cut in May. However, as recent months have shown, economic conditions can change quickly, influencing borrowing costs unexpectedly.
Rightmove’s mortgage tracker highlights how persistently high mortgage rates are affecting buyer sentiment. The average five-year fixed mortgage rate currently stands at 4.74%, a decline from its July 2023 peak of 6.11%, yet only slightly lower than the 4.84% recorded this time last year. Despite this, lenders remain eager to attract borrowers, with some adjusting their rates competitively to secure business during what is typically a busy period for the housing market.
Many sellers are recognising the importance of realistic pricing in today’s market. Sarah Bush, head of Residential Sales and Lettings at Cheffins, noted that the year has started positively, with a noticeable increase in the number of homes being listed compared to last year. Despite ongoing economic uncertainty, many homeowners are eager to move forward with their plans rather than waiting on the sidelines.
Pricing remains a crucial factor, particularly in rural areas where buyers remain price-sensitive. The upper end of the market is proving the most challenging, with sellers needing to be especially cautious about overpricing. According to Bush, those looking for a smooth and successful sale should avoid setting unrealistic expectations.
Looking at broader market trends, Chris Rosindale, chief operating officer at Connells Group, highlighted steady growth in the sales market at the start of the year. An increase in listings suggests that sellers are feeling more confident about moving, and overall market activity has picked up.
The stability of interest rates and modest house price growth have played a role in boosting confidence among both buyers and sellers. While economic conditions remain a concern, the general sentiment towards buying and selling remains positive.
As the market moves forward, industry experts continue to stress the importance of setting competitive asking prices. With growing buyer confidence and increased supply, sellers who price their homes realistically are in the strongest position to achieve a successful sale.
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