July saw a seventh consecutive monthly rise in the price of property coming to market, up by 0.3% (+£860), and the second successive national record, according to Rightmove.
New sellers are now asking 4.8% (+£11,561) more than a year ago, a big jump from the 2.7% annual rate recorded in June.
Miles Shipside, Rightmove director, said the market is currently benefitting from the ‘aggregation of marginal gains’ where incremental improvements across a range of key market drivers compound to slowly but surely build momentum.
He said: “Rightmove’s lead indicators show increases in enquiries, new sellers and marketing prices. An important milestone for a broader-based and sustainable recovery is that all regions of the country now have higher prices than a year ago firmly on the record.”
Early findings from Rightmove’s latest Consumer Confidence Survey, which has already received more than 25,000 responses from home-movers, show that 62% expect property prices to be higher a year from now, double the 31% recorded a year ago.
Shipside said: “The price optimists have doubled compared to just 12 months ago and now outnumber the price pessimists ten to one. Consumer confidence is key to the housing market and on this front there has finally been a year of minimal bad news, with a reasonable amount of good, after four years of pretty consistent doom and gloom.
“A combination of apparent economic stability internationally – or at least, less widely-reported turmoil and uncertainty – and some positive signs of an economic upturn nationally, mean more home-movers are willing and able to increase their financial commitments. Barring a raft of bad economic news, we expect the positive impact of this on the property market to continue.”
Meanwhile, Rightmove’s email enquiries to agents and developers are up 18% year-to-date compared with 2012. The front of the housing market pipeline is also showing more activity with new seller numbers up 5% this month compared with July 2012.
Shipside said: “Confidence and the ability to take on a long-term mortgage commitment give more buyers the spur to enter the market or trade up. The route from property enquiry to trading onto or up the property ladder has been cleared of some obstacles, resulting in a partial unblocking of pent-up demand.
“The ability to borrow is increasing as the Funding for Lending Scheme starts to really deliver, though it still favours those with better deposits. Lenders are squeezing their margins and, with the prospect of no base rate rise for three years, consumers are increasingly aware of moving options rather than debt burden. The Help to Buy scheme, the centre-piece of the last Budget, has already created a marked upturn in the new-build market as recently reported in some developers’ trading updates. We even hear that some developers are ‘running out of bricks’.
“While stocks of some brick styles have no doubt been run down, a similar impact on the bricks and mortar of the resale market is possible from January next year. The outlook for more moves and movers for the second half of 2013 and beyond is increasingly positive”.
At the beginning of 2013 Rightmove suggested a more positive outlook for 2013 and forecast average national asking prices would rise by around 2%. Following the first quarter of the year, it now expects the average asking price of property coming to the market in England and Wales to end 2013 around 4% higher.
While the current annual rate stands at 4.8%, in recent years the gains of the first-half of the year have been eaten away in the second. Between June and December last year, asking prices fell by 7%. The signs are that prices in 2013 will not dissipate as they have in recent years.
Shipside added: “There will be significant underlying regional variations with some areas, primarily in the north, struggling to stay in positive territory for the year. London will continue to outperform the rest of the country and we also expect the South East, the main beneficiary of the ‘over-spill’ from the capital, to maintain its strong momentum, both driven by an on-going shortage of supply of property for sale.
“Asking prices in the capital are currently 29% higher than they were five years ago compared with 7% in the South East and just 5% nationally.”
