UK house prices jump to record high of £373,000 in May

House prices Residential properties on Foulden Road, Amhurst Road and Stoke Newington High Street, Hackney, N16, east London, England, United Kingdom.
House prices in Hackney saw the highest increase across London, now standing at £724,189. Photo: PA/Alamy

The average price of houses coming to the market in May reached a new record of £372,894 as new sellers responded to an improving market.

Average new seller asking prices jumped by 1.8% — or £6,647 — this month, according to Rightmove, as sellers respond with increased pricing confidence to a market that is defying start-of-the-year expectations.

With buyer demand 3% higher than in 2019 and sales agreed just 3% behind 2019’s levels, this positive activity has filtered through to new sellers’ asking prices.

“This month’s strong jump in new seller asking prices looks like a belated reaction and a sign of increasing confidence from sellers, as we’d usually see such a big monthly increase earlier in the spring season. One reason for this increased confidence may be that the gloomy start-of-the-year predictions for the market are looking increasingly unlikely. What is much more likely is that the market will continue to transition to a more normal activity level this year following the exceptional activity of the pandemic years,” Tim Bannister, Rightmove’s director of property science, said.

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A steadying in average fixed-rate mortgages is also contributing to greater home-mover confidence. The average rate for a five-year fixed, 15% deposit mortgage is now 4.56%, down from 5.89% in October. This compares to 4.52% last week.

“Steadying mortgage rates and a generally more positive outlook for the economy are also contributing to more seller confidence, though there are likely to be more twists and turns to come. The market is still very price-sensitive and it is important that new sellers do not damage their prospects of a sale by overpricing initially and reducing later, with agents reporting that it’s the realistically-priced new instructions that are selling best,” Bannister added.

The average discount from the final asking price to the agreed sale price has steadied at an average of 3.1%, in line with pre-pandemic market levels.

Across the UK, Scotland saw average house prices go up by almost 5% in a year, with the cost of a Scottish home now at £191,407.

In Wales, prices crept up by 0.7% to £259,452, with properties staying on the market for 52 days before finding a buyer.

In the North East, the average house comes with a price tag of £179,693 — a 0.2% drop in 12 months, while Yorkshire & Humber saw prices jump 3.9% to £248,247.

In the East Midlands, average house prices climbed 2% year-on-year to £288,311, while in the East of England properties were going for £424,844.

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The North West saw house prices go up by 2.6% to £256,088 and the West Midlands experienced a 2.2% increase to £288,862. In the South West, prices reached £393,426.

With no surprise, London continues to command the highest property prices in Britain, with a house in the capital going for around £696,477. The borough of Hackney saw the highest increase, with prices now at £724,189 — over 5% more than a year ago.

The South East comes in second, with house prices averaging £494,471.

While properties in this largest-homes sector are still selling faster than in 2019, it is now taking an average of 67 days to agree a sale, nearly double the 35-day average at this time last year. This is the biggest increase in the time taken to find a buyer, with second-stepper properties now taking 52 days on average compared to 28 days last year, and first-time-buyer properties now taking 53 days, up from 35 days a year ago.

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