House prices continue rise after ‘busiest ever’ H1 – Rightmove

The busiest first half of a year ever recorded in the UK property market has pushed the average price of property coming to market to a new record high for the fourth consecutive month, new data from Rightmove has revealed.

According to Rightmove’s latest House Price Index, the average house price has risen by £21,389 in just six months, equivalent to growth of +6.7%.

The latest all-time high of £338,447 is due to a monthly rise of 0.7%, pushing average prices up by a further £2,374, which is the largest monthly rise at this time of year since July 2007.

Rightmove’s analysis also identified a shortfall of 225,000 homes for sale which the property expert stated if available, would have helped to maintain a more normal level of property stock for sale as well as helped to stabilise prices. This shortfall, along with frenzied buyer activity, is fuelling record high prices and leading to record lows in available stock for sale, Rightmove suggested.

With high activity levels continuing despite the June stamp duty deadline now passing, Rightmove has highlighted an “urgent need” for these low stocks of property for sale to be rebuilt, in order for price stability to return.

The property expert’s director of property data, Tim Bannister, is predicting that the number of completed sales will be the “highest ever seen” in a single month when June’s data is released by HMRC later this week.

“This means it’s likely that the first half of 2021 has seen a record number of moves when compared with the first six months of any other year, induced by the pandemic’s side-effect of a new focus on what one’s home needs to provide,” Bannister said. “That is one of the driving forces behind four consecutive months of new record average property prices.

“Demand has also been boosted by the ongoing creation of new households, and property being seen as an asset to hold, with historically low returns from many other forms of investment. New stamp duty deadlines in England and Wales for sales completed by the end of June have also helped to exhaust the stock of property for sale and concentrate activity.

“This has left prospective purchasers with the lowest choice of homes for sale that we’ve ever recorded, continuing price rises, and stretched affordability.”

Commenting on the new data, Benham and Reeves director, Marc von Grundherr, added: “The UK property market continues to defy expectation, with house prices reaching yet another record high despite whispers of a decline in values as a result of the tapered stamp duty holiday deadline.

“There’s no doubt the stamp duty holiday has been the catalyst for this impressive market performance. However, it isn’t the driving factor behind the intent to purchase for UK homebuyers and so a robust level of activity will remain long after it has expired. When you couple heightened demand with a severe shortage of stock, it’s very likely that property values will remain buoyant for the remainder of the year, at the very least.”

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