Summer has arrived, and house prices are continuing to soar more than ever before.
According to Rightmove, house prices in the UK achieved a new high in June, but the market is set to stabilize in the coming months. Moving into its fifth consecutive month this June, the average price of a property in the UK has hit a new record high of £368,614. *
The new high price is the biggest for this time of year since May 2014, and it represents a nationwide increase of £55,551 in asking prices in the two years since the pandemic shut down the housing market. This, compared to a price increase of just £6,218 in the two years before the pandemic, shows how frantic market activity has led to a price growth never seen before in over twenty years of tracking house prices.
Why are house prices continuing to rise?
The average asking price is rising as a result of continued strong buyer demand at a time when there are limited available homes on the market. Prices are rising despite the increase in interest rates and the cost-of-living crisis.
Although there are indicators that the market is beginning to ease, this fifth consecutive house price record has not dampened many people’s motivation and urgency to move. The number of people looking to move is up by 31% from 2019, whilst the number of properties available to buy is 55% down from the same time period. This means that supply and demand will likely be unbalanced for at least the rest of the year.
Rightmove's Tim Bannister, Director of Property Science, shared his thoughts on the current climate of the market, explaining that "what the data is showing us right now is that those who have the ability to do so are prioritising their homes and moving, and the imbalance between supply and demand is supporting rising prices."
“Though demand is softening from the heady levels we saw this time last year, the number of buyers enquiring is still significantly higher than during the last ‘normal’ market of 2019, while the number of homes for them to choose from remains more constrained.”
More houses are coming to market
Since the start of 2022, we have witnessed a small increase in the average number of properties each estate agent has for sale, indicating that buyers are gradually being given more options when looking for their homes.
Experts are recommending that those who are thinking of selling a property this year, act fast by putting it on the market, as many sellers prefer buyers who already have a sale agreed.
What can we expect to see from the market in the second half of the year?
There are indications that the market’s speed is beginning to slow, but this is happening gradually.
The ongoing price growth this year has been aided by strong buyer demand and limited available stock. With more people choosing to put their houses on the market and affordability worries among home-movers, competition among buyers is likely to reduce in the second half of 2022. Experts are recommending sellers take advantage of the current market conditions and put their homes on the market now.
If you’re looking to take advantage of the current market climate, contact your local Parkers branch.