The average price of properties coming on to the market increased by 2.3%, or £7,785, this month to hit a record of £348,804, the biggest monthly jump ever recorded by Rightmove.
Asking prices are now 9.5% higher than a year ago, the highest annual rate of growth since September 2014.
According to the property website, more potential buyers are sending enquiries to agents, with the number 16% higher than this time last year, while new property listings are up 11% compared to the same period last year, suggesting more sellers are coming to market before looking for a property to purchase, to avoid missing out on their next home.
The number of people requesting a home valuation from an estate agent was up 11% in January compared to last year, Rightmove said.
Property industry reaction:
Jeremy Leaf, north London estate agent, said: “The market is continuing where it left off at the end of last year. Although Rightmove‘s figures are based on asking, rather than selling, prices, there still seems to be scope for further increases.
“Demand hasn’t been blown off course so far by the weather, rising interest rates or inflation as we have recorded a significant proportion of buyers who missed out in some of last year’s competitive bidding returning for another try.
“Listings are increasing but not fast enough to satisfy appetite for houses in particular which is inevitably reducing the number of transactions.
“Looking forward, stretched affordability will mean prices cannot keep rising at the same pace but certainly there’s no sign of any significant softening yet.”
Geoff Garrett, director of Henry Dannell, commented: “It remains very much a sellers market and the continued increase in asking price expectations demonstrates this, as buyers are further stretched in order to secure a home.
“However, with high chances of at least two further interest rate increases over the course of this year, those purchasing with the help of a tracker or variable rate mortgage will notice their monthly costs climb significantly.
“While it’s a competitive market, it’s strongly advisable to avoid over stretching yourself financially to secure a purchase, as this could well lead to financial instability further down the line.”
James Forrester, managing director of Birmingham estate agent Barrows and Forrester, said: “There’s certainly been no let up in the sheer volume of buyers swamping the market and we continue to see high numbers fighting it out for a very limited level of stock, the result of which is an inevitable boost to property values.
“However, we’re also seeing sellers preempt this high demand and enter the market at a far higher price point to take advantage of this buyer desperation and this has pushed asking prices up at their highest monthly rate in over two decades.”
Marc von Grundherr, director of Benham and Reeves in London, commented: “There have been numerous signs that the London market is starting to turn in recent months and it is very likely we’ve now seen the back of the capital’s pandemic house price slump.
“The start of 2022 has been exceptionally busy and buyer enquiries have shot through the roof, as
“London home buyers try to get in quick and secure a purchase before house prices start to accelerate.
“It’s only a matter of time before this initial buyer demand and the sharp increase in asking prices starts to filter through to completed sales, at which point we expect home sellers across the London market will further up their asking prices as a result of this growing market confidence.”
Andrew Teacher, founder of Blackstock Consulting, commented: “The housing market now seems to be decompressing, with interest from buyers expanding and sprawling like a giant slinky spring. However, it’s important to put these statistics into context as they are for the first real month since the Covid cloud started to lift.
“The other key point is that the result of caution driven by Covid has been a lack of supply, with people hedging their bets and holding off from buying or selling their home. This in itself has been a key driver of pricing as those areas of the market with significant interest, like London and many others, will likely have been more competitive than in a traditional market.”
Comments are closed.