Rightmove: Housing market shows ‘signs of recovery’ as prices rise 3%

Mortgage rate hikes and the subsequent tightness in the real estate market have not deterred optimistic home sellers, according to Rightmove.

According to the latest monthly report, the average asking price for newly offered homes has risen by 3 percent in the past year, despite the shortage.

It said the typical asking price had risen by £2,906 to £365,357 in the year to mid-March as the market showed ‘tentative signs of recovery’ after turbulence in late 2022 in the wake of the ill-fated mini-Budget.

And despite official forecasts that house prices will fall 10 percent from their budget peak, average asking prices have risen 0.8 percent over the past month.

Rightmove claimed buyer demand was 6 percent higher than the same period in 2019.

However, according to the property platform, the average asking price is still £5,800 below its October peak.

Last month, price growth was driven by a 1.2 percent increase in the largest homes – those at the top of the real estate ladder.

While prices are rising, Rightmove said larger homes typically take longer to sell.

Tim Bannister, Rightmove’s director of real estate science, suggests this may be due to fewer pandemic-driven moves to larger homes and “a more cautious approach to trade-ins” due to the higher cost of living.

Bannister said: “At the start of the spring season, stability and confidence continue to return to the market as it recovers from the turbulence at the end of 2022.

The pace of the market reached unsustainable levels over the past two years and was on track to slow to more normal levels, although the rate of this slowdown to more normality was accelerated by the reaction to the September mini-Budget.

House prices are rising again after a dip at the end of last year

While higher mortgage rates and economic headwinds pose challenges, many would-be movers who have effectively been on the sidelines in the frantic bidding wars of the past two years will find that a slower market will give them time to plan and secure their next move as we move forward. are entering the traditionally busy spring shopping season.’

First-time buyers are also recovering with prices now just £500 lower than their all-time high last year, and agreed sales were just 4 per cent below the last comparable period in 2019.

This despite the fact that affordability for first-time buyers remains almost at an all-time low due to higher mortgage and deposit costs.

Regionally, the North East of England saw the biggest price increase, rising 2.5 month on month. Property in the east of the country, on the other hand, performed the worst with average prices falling 0.2 percent over the month.

Affordability for first-time buyers is still under pressure from rising mortgage rates and down payment costs

Good news for homeowners: Mortgage rates have fallen from last year’s high in the wake of the mini budget.

The average 15 percent five-year deposit mortgage now has a rate of 4.65 percent, slightly lower than last month’s average of 4.75 percent and October’s 5.89 percent.

However, these are all a dramatic increase from a year ago when the average was 2.48 percent.

The increase means a £200,000 mortgage over 25 years is now £234 a month more expensive, an extra £2,808 a year, than it was last March.

The average stock of available homes per broker remained largely the same in February at 43 homes. This is one higher than in January, but lower than the 50 in September last year.

Regionally, the Northeast experienced the largest increase in house prices in the past month