Housing market momentum continues to push up the price of property coming on to the market up with a rise of 0.8% or £2,320 to new high of £310,471, according to the June report from property portal Rightmove.
Desire to buy and lack of supply is affecting the market with the time to sell falling to 57 days, the fastest ever measured by Rightmove.
But there is some signs of referendum associated uncertainty with fewer new sellers coming to market as new properties for sale were down 5.3% compared to average at this time of year with the most reluctant being owners of larger homes with four or more bedrooms who have dropped by 6.6%.
A breakdown of the figures show that in the North East asking prices increased by 0.1% month on month and 3.1% year on year to an average of £148,662 while in the North West they were up 2.2% month on month and 4.2% year on year to £183,482.
In the West Midlands there was a month on month rise of 1.4% and year on year asking prices were up 4% to an average of £209,273 and in the East Midlands up 0.6% and 4.8% respectively to £198,090.
There was a month on month rise of 0.6% in Yorkshire and Humber and year on year asking prices are up 2.6% to an average of £178,388 while in the East of England they were up 1.2% and are now 9.4% above a year ago at £338,499.
In the South West there was a 1.4% month on month rise and year on year an increase of 5% to an average of £302,022. In the South East asking prices rose 0.7% month on month and are 6.9% higher year on year.
In Greater London price growth is slowing with a month on month fall of 0.2% and asking prices are now 4.8% higher than a year ago at £643,117. Meanwhile growth has been steady in Wales, up 1.4% month on month and 6% year on year to £185,145.
Overall, there have been price rises every month so far in 2016, showing that the uncertainty associated with the EU referendum has failed to halt this year’s upwards price momentum, according to Miles Shipside, Rightmove director and housing market analyst.
He pointed out that this is in contrast to the run-up to the May 2015 general election, when the electoral uncertainty resulted in a price fall of 0.1% in the month of the election. ‘This year the first quarter buy to let surge has exacerbated the shortage of suitable property for sale, and with ongoing buyer demand fuelled by cheap mortgage money, there appears to be greater resilience. The result is that the average time it takes to sell a property is at its lowest level since Rightmove started monitoring it in 2010,’ he explained.
He also pointed out that in many parts of the country, the overriding factor of supply outstripping demand has so far overcome buyers’ usual reluctance to make major financial decisions at times of political uncertainty.
‘Most seem to be getting on with the certainties they can control, namely if you find a suitable property snap it up. Indeed the figures for average time to sell indicate that properties are being snapped up more quickly than ever,’ he added.
The average number of days to sell stands at 57 this month, down from 60 the previous month. At this time last year it was 65 days. While some prospective buyers are putting in offers within hours or days, this is an average for all properties and the timescale is from when a property is first marketed on Rightmove to when the estate agent marks it as sold subject to contract.
‘With today’s tighter lending criteria, marking a property as sold before you’re certain that the buyer has the means to pay for it could mean missing out on other more suitable purchasers,’ said Shipside.
‘It takes time to check that a prospective buyer can get a mortgage, and ensure that all other buyers in the chain are also in a position to proceed. In spite of these extra delays and necessary diligence, the length of time to sell is the lowest we’ve ever measured,’ he explained.
‘However, this does not mean that sellers can be over ambitious on their asking prices, as buyers’ affordability is increasingly stretched and they’re shopping around so their budgets go further. If you set too high a price your property can become stale and be ignored by suspicious buyers even if later reduced to a more sensible figure,’ he pointed out.
‘Given that housing markets dislike uncertainty, which could become a reality in the event of a Brexit vote, any dampening of buyer activity might mean that more realistic pricing would be an even more critical factor to achieve a sale,’ he added.
The report suggests that while most of the headline figures show few signs of pre-referendum distortion, there does appear to be uncertainty among those contemplating putting their properties up for sale.
