The Bank of England’s August interest rate cut seems to have done its job in spurring on the housing market for now, with average new seller asking prices rising by 0.8%, or about £2,974, this month to £370,759, according to Rightmove’s (RMV.L) monthly monitor.
September usually sees a monthly rise in prices, but this year’s increase is double the long-term average, with prices supported by increased activity levels, the property platform said.
Meanwhile, the number of sales being agreed is up by 27% year on year, a strong rebound compared with last year’s more subdued market as pent-up buyer demand is released.
Supply is strong too: the number of new sellers is up by 14% on this time last year, and the average number of available homes for sale per estate agent at its highest since 2014.
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“The certainty of a new government followed by the first bank rate cut in four years invigorated the market, opening a window of opportunity for movers to act,” said Tim Bannister, director of property science at Rightmove.
“Some of this will be pent-up demand from those who had to hit the pause button until now. However, windows of opportunity tend to need a momentum of good news to stay open, and there are still uncertainties ahead which could cause some of the current market activity to ease,” he added.
While there are positive moves in the market, there is also some caution. Rightmove added that it’s currently taking an average of 60 days for a seller to find a buyer, three days longer than in the more subdued market at this time last year as value-conscious buyers take their time to find the right home at the right price.
“At this point it is important to consider what effect the budget at the end of next month may have on the housing market and if today’s figures reflect a keenness by consumers to complete on a property before any potential changes to the current tax structure might be announced,” said Nathan Emerson, CEO of Propertymark, the professional body serving estate agents.
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The data chimes with reports released last week which showed the number of new properties being listed on the market also rose with prices amid fears of a capital gains tax hike in the upcoming autumn budget.
The Royal Institution of Chartered Surveyors (RICS) August residential market survey showed that its net price balance, which acts as a leading indicator for other house price indexes, had risen +1 following almost two years of declines.
Surveyors also expected this to continue, with a +14 net balance of respondents to the survey predicting a steady rise in prices over the next three months.
Halifax’s August index, released the week before, showed UK house prices rose last month at their fastest annual pace since late 2022, up 4.3% year-on-year.
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