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House prices in England and Wales hit record high: first-time buyers lead the national market to the highest number of sales agreed since 2007

  • By Super Admin on 2017-05-01 10:09:02

House prices in England and Wales hit a record high this month, while agents recorded the most sales agreed since before the credit crunch, despite the impending General Election.

The average national asking price has now reached £313,000, a 1.1 per cent increase on 2016 figures. While the rate of growth in the rest of the country continues to outpace London house prices, the average cost of buying a home in the capital is double the national average at £636,777.

Most regions recorded both monthly and annual price rises, apart from Greater London, where prices dropped 1.5 per cent, and the North East, home to Newcastle, Sunderland and Darlington, where house prices dropped 0.7 per cent year on year, according to Rightmove.

“High buyer demand in most parts of the country has helped to propel the price of newly marketed property to record highs. There are signs of a strong spring market with the number of sales agreed achieved at this time of year being the highest since 2007”, says Miles Shipside, Rightmove director.

PRICE RISES LED BY FIRST-TIME BUYERS

The East of England, home to popular London commuter areas like Cambridge and Essex, saw the biggest annual price rise of 5.3 per cent, with the West Midlands, home to Birmingham, close behind with five per cent growth.

The rate of growth is being propelled by first-time buyers, with property prices in this sector hitting a new record of £195,000, up 6.5 per cent compared to 2016.

These first-time buyers are taking advantage of declining competition from buy-to-let investors following last April’s Stamp Duty shake up, which imposed an added three per cent tax on second homes.

DECLINE OF BUY-TO-LET

“Strong buyer activity this month has led to 10 per cent higher numbers of sales agreed than in the same period in 2016”, says Shipside. “This large year-on-year disparity should be viewed cautiously as the comparable timespan in 2016 saw a drop in buy-to-let activity with the additional second home stamp duty. However, they are also up by 3.8 per cent when compared to 2015.

“With the growth in household numbers and new-build supply struggling to keep pace, demand is strong and has led to the highest sales agreed numbers at this time of year since the heady pre-credit-crunch levels.”

TOP END SELLERS MODERATING PRICES

Despite strong demand for two bedroom or smaller homes, the annual rate of price growth for the market as a whole was the slowest in four years.

Rightmove attributed this to less activity at the top of the market with buyers increasingly struggling to afford homes in expensive areas – Greater London in particular – and deterred by Stamp Duty increases for homes above £1 million. As a result, sellers at this level are being forced to moderate their price expectations.  

However, the buoyant spring market is offering a degree of optimism to agents ahead of June's snap General Election.

“The forthcoming election is unlikely to have a significant effect on the buoyancy of the market. The underlying fundamentals are still in place and we are expecting seasonal activity to remain robust as we head into the summer months,” said Kevin Shaw, national sales director at Leaders.

Source; The Independent.

 

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