The average price of property coming to the market for sale has risen by 1.7% in January (£5,992) to £366,189.
This is the largest monthly jump in prices at the start of the year since 2020, as new seller asking prices bounce back from the typical seasonal dip in December. This indicator of new year optimism is according to the latest Rightmove House Price Index.
Average asking prices are still £8,942 below May 2024’s peak, reflecting buyer affordability constraints. However, with a record number of early-bird new sellers coming to market from Boxing Day and into January, there seems to be pent-up demand to move.
The Rightmove index shows the number of new properties coming to market is 11% ahead of the same period at the start of 2024, while the average number of homes for sale per estate agency branch is currently at the highest for this time of year in 10 years.
High buyer choice has contributed to increases in buyer enquiries and sales agreed compared to a year ago, but also means fierce seller competition to attract these new year buyers. Some sellers may find that they have been too optimistic on their initial pricing and get left on the shelf in favour of more competitively priced neighbours.
Commenting on the latest figures Rightmove property expert Colleen Babcock said: “New sellers have started the year with a bang, with a record number coming to market not only on Boxing Day itself, but across the start of the year to date. We’ve also seen a strong start to the year in new seller asking prices, though given the higher-than-anticipated seller competition, we would expect this to slow down over the next few months.”
She added: “Buyer activity is also starting the year encouragingly, as many festivity-distracted buyers return to make their move happen. Since Boxing Day, the number of buyers contacting estate agents about homes for sale is up by 9% on the same period last year. The combination of good choice and healthy buyer demand has kept the sales trend positive, with the number of sales being agreed between buyers and sellers now 11% ahead of this time last year.”
Interest rate moves
However, Babcock stressed that are uncertainties ahead, including the pace and number of future interest-rate drops and the impact of increased stamp duty for many home-movers from 1st April.
“One market sector that Rightmove anticipates will be particularly affected is the smaller-homes, typical first-time-buyer sector. Since Boxing Day, the number of enquirers in this sector is up by 8%, the lowest increase of all market sectors. First-time buyers in cheaper parts of England will largely be unaffected. However, stamp duty charges rising for those buying above £300,000 will be a drag on the important bottom-of-the-ladder market in more expensive areas, unless some additional help for first-time buyers is announced soon.”
Propertymark chief executive Nathan Emerson commented: “As we progress into the new year, it’s positive to see many of the variables that help power the housing market continue to align. We are still seeing regional disparity with regards to overall house price growth, and contributory factors such as inflation settling.
“What we are witnessing is an encouraging uplift in consumer confidence, with an average 10% leap in prospective buyers registering their interest to purchase. This, coupled with a desire for many existing transactions to beat any Stamp Duty increases across England and Northern Ireland before April, has opened the year with pace.”
