Brian Murphy Head of Lending for Mortgage Advice Bureau comments:
“Rightmove’s report provides us with an in-depth view of asking prices and consumer activity with regards the property market, rather than data on completed transactions, and therefore provides us with an up to date ‘coal-face’ view rather than a historical one. Based on today’s insights, it would seem that after a steady start to the year, pent up demand has now meant that asking prices in certain regions have escalated to the realms of never-seen before highs, bringing with them a whiff of the fizzy market last witnessed in 2007.
Having said that, it’s not entirely surprising that asking prices of entry level properties in some regions have seen such a significant increase over the last month, particularly off the back of UK Finance data released last week, which showed a significant increase in First Time Buyer borrowing since the beginning of the year. This together with recent statistics from RICS suggesting that the overall number of properties for sale in this country is now at a new record low and the suggestion from Mark Carney in February that interest rates may increase sooner rather than later may all contribute to a ‘perfect storm’ of motivating First Time Buyers to take steps to get on the ladder sooner rather than later, hence increased competition for fewer numbers of properties in some areas creating the upwards pressure on asking prices that we’re now seeing.
The fact that such increases have been observed at other levels of the market, for example second stepper and larger family homes as well as at entry level, after what had previously been a rather sedate start to 2018 does perhaps give rise to caution for those who are selling their property currently. Although sellers may realise their asking price at offer stage, if we are seeing prices in some areas accelerating at these levels, one would suggest that caution may need to be applied in order to avoid an overheated market which then results in inevitable Surveyor down-valuations. It remains to be seen then if this month will be an anomaly, or if this is perhaps the start of a more frenetic Spring market than many had perhaps previous anticipated.”
Read the full Rightmove report here.