Price growth in the northern regions has been the strongest over the past month, while the average UK asking price stays steady despite the looming general election.
The typical UK asking price is now £375,110, according to the latest research from Rightmove, which is just £21 lower than last month’s figure and shows an ongoing stability in the market. This is supported by extremely high buyer demand, which has been reported across much of the country and continues to support UK asking prices.
This comes despite an element of uncertainty surrounding the general election which is set to take place on 4th July, as well as mortgage rates (and the Bank of England interest rate) not falling as they had been expected to do so by many in the market.
This past month, according to Rightmove, it has been business as usual in the housing market as sellers continue to list and eager buyers continue to snap up property in a market that is heating up – although seller numbers have fallen slightly more in the top end of the market, says the property portal.
The number of sales agreed is now 6% higher than it was a year ago, while buyer demand is 5% up on last year, which is much the same as last month’s figures. By contrast, though, the number of top-end seller fell by 3% annually when looking at the two-week period after the election announcement.
UK asking prices across the regions
Rightmove notes: “Price trends differ across Great Britain, and the strongest price growth this month is occurring in the less expensive and more northerly regions, with five of the six cheapest areas reaching new price records.”
Looking at the data, the north east and the north west of England have seen the biggest monthly rises in their asking prices, of 1% and 0.9% respectively. On an annual basis, the north east has seen its prices increase by 1.9%, compared with the north west with a 1.8% rise.
Annually, Yorkshire and the Humber recorded the biggest surge in its asking prices of 2.8%, although the latest figures show the market in this region was flat over the past month.
By contrast, on a monthly basis the east of England had the biggest fall of -0.5%, followed by London with a -0.3% drop. Annually, prices in the east have decreased by -1.4%.
Cheaper to rent
While the UK rental market has seen its prices rise considerably over recent years, recent rises in the average UK asking price have meant that in some areas, it is cheaper to rent than to get a foot onto the housing ladder.
According to Rightmove, which compares the average mortgage payment with a 10% deposit for a first-time buyer vs the equivalent rental payment, mortgage payments have been higher than rent for first-time buyers for the past two years.
This is supported by recent research released by Hamptons, which found that renting was “significantly” more affordable than buying a home with a 5% deposit in the UK, with such homeowners paying an average of £300 per month more in mortgage payments than they would in rent.
In London, this is worsened by the extremely high property values which generally significantly exceed average UK asking prices. Here, buying a house costs an additional £775 per month on average compared with renting. However, prices in the capital are not rising at the same rate as wider UK asking prices.
Affordability still stretched
Because mortgage rates remain stubbornly high, affordability is still a key issue in the housing market, which is also likely to affect UK asking prices. For this reason, a Bank of England base rate cut is likely to have more of an impact on the sector than the sentiment surrounding the general election.
Tim Bannister, Rightmove’s Director of Property Science, said: “It’s always difficult to predict how home-movers will react to sudden uncertainty, but looking back through our data, we can see that during previous election campaigns, market activity has remained largely steady.
“This election has followed a similar pattern so far, and the responses from our poll of over 14,000 people also supports the data, with the vast majority of respondents saying they will carry on with their home-moving plans.
“However, some potential sellers appear to be watching and waiting rather than taking action, evidenced by a dip in the number of new sellers coming to market, particularly at the top-end. This is understandable when many of these sellers have more flexibility over when they act, but overall, it appears to be business as usual for the mass-market.”
