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UK house prices near record highs after 'boom' in buyers

Tom Belger
Finance and policy reporter
A street in Leeds as figures show average prices rising fast in Yorkshire and the Humber. (Rahman Hassani/SOPA Images/LightRocket via Getty Images)

Average property prices in the UK are close to record highs after a boom in buyer numbers, according to Rightmove.

Asking prices on the property site have jumped by £2,589 ($3,378) over the past month, reaching an average of £309,000 in early February. It leaves prices just £40 short of their all-time high for Rightmove sales in June 2018.

Yorkshire and the Humber saw the fastest monthly leap in prices, up 3.5% to an average of £197,000.

The number of sales is also on the up after several years of stagnant activity, rising by 12.3% in a year nationally and by 25.4% in the capital.

Rightmove’s director Miles Shipside said he expected demand from buyers to keep outstripping supply, pushing prices to new records next month.

The election is widely thought to have unlocked confidence among buyers, easing some of the Brexit uncertainty that has hung over the market since the 2016 referendum. Now the optimism about the market also appears to be spreading to sellers.

Read more: Frozen housing market thaws as buyers ‘move on from Brexit’

“The bounce in our statistics seems to show that many buyers and sellers see the election result as giving a window of stability,” said Shipside.

Low interest rates, growth in average wages and record high employment are all fuelling underlying demand, he added.

He said it could be an “excellent” time for homeowners to sell, but warned sellers the market remained sensitive to price with buyers’ budgets so stretched.

The number of new sellers listing on Rightmove rose 2.1% over the past month to 110,000, marking the first increase in more than a year. But listings are still currently “failing to keep pace” with the jump in buyer demand.

Read more: UK ‘won’t fix housing crisis’ after 10 housing ministers in 10 years

Lucian Cook, head of residential research at estate agents Savills, said stock levels remained relatively low. He also warned sellers to be “pragmatic,” with its staff across the country reporting buyers were unwilling to increase their budgets.

Some uncertainty remains over the upcoming government budget too, according to Cook. The government was recently reported to be considering a ‘mansion tax.’

Edward Heaton, managing partner of property consultancy Heaton & Partners, said he expected prices to “flatten” later this year as UK-EU trade talks bring fresh economic uncertainty.

Some areas have also not seen any uptick in prices over the past month. Prices dropped in the East Midlands, falling 0.5% month-on-month to an average of £229,000.

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