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House prices hit new peak as supply tightens in South



Many popular locations are suffering from for sale sign "black spots" due to properties being snapped up, says Rightmove

Monopoly houses on Old Kent Road and Mayfair
Monopoly houses on Old Kent Road and Mayfair

Prices are up by 2.6pc on a previous record of 255,962 set only last month, according to the website's records, which go back to 2002 Photo: Justin Sutcliffe

House sellers' asking prices have lifted to record highs for two months in a row amid a "ridiculously tight" supply of homes for buyers to choose from in many areas of the South, a property website has reported.

New seller asking prices hit a new peak of 262,594 in April across England and Wales, which is 7.3pc higher than a year ago, marking the fastest annual rate of increase seen since October 2007, Rightmove said.

Prices are up by 2.6pc on a previous record of 255,962 set only last month, according to the website's records, which go back to 2002.

Asking prices hit new records in April of around 272,321 in the South West, 335,142 in the South East, 572,348 in London and 236,659 in East Anglia, as many popular locations are suffering from for sale sign "black spots" due to properties being snapped up, Rightmove said.

The website quoted one estate agent from Surrey who said 12 buyers are registering for every property that comes to market and another from Bristol who said strong competition for homes is prompting properties to be sold for 3pc above their asking price.

In London, asking prices are up by 15.9pc on a year ago typically and they have surged by 41.8pc since October 2007.

Asking prices in northern regions, where the supply of homes for sale is more evenly matched with the number of buyers coming to market, are still around 6pc below their October 2007 levels.

The North West has the furthest to climb, with asking prices standing at around 8.8pc below what they were in October 2007, at 165,581 on average.

Since 2007, London sellers have typically hiked their prices by more than the cost of an average home in the North West.

Rightmove said London's new sellers are asking an "eye-watering" 168,711 more than they were six and-a-half years ago, while Northern regions are down by 10,653 over the same period and in the North West, prices are still around 16,049 adrift.

Prices are higher in every region across England and Wales than they were a year ago, with London seeing the biggest leap and the West Midlands the smallest, with a 0.8pc annual increase taking prices there to 194,175 on average.

In Wales, sellers have hiked their asking prices by 0.9pc year-on year to reach 171,663 typically.

Strengthening housing market activity has fuelled concerns that property values are surging to unaffordable levels in places where the supply of homes is not enough to keep pace with the growth in demand.

Last week, the Royal Institution of Chartered Surveyors (Rics) said there is a "desperate need" to address the lack of homes on the market, warning that house prices will continue surging by around 6pc annually for the next five years unless more is done.

Mortgage support schemes such as Help to Buy and improving consumer confidence have prompted more buyers to flood into the market in recent months, while London is continuing to attract strong interest from overseas buyers.

Miles Shipside, director of Rightmove, said that a "ripple effect" stemming from the "boom" in the London market means that southern regions are now starting to see stronger uplifts as would-be buyers broaden their search.

He said: "Supply in much of the South is ridiculously tight, with 'for sale' board black spots in many popular locations within easy commuting distance of London.

"There are vicious circles where there is so little property for sale that few local home owners are willing to come to market to trade up, exacerbating the shortages and boosting sellers' pricing power.

"While there are some hot spots emerging in the North, the momentum is not nearly as fast-paced and the better match between supply and demand means that the market is running at more sustainable levels."

Rightmove quoted estate agents' who told how the market is continuing to hot up.

Speaking about the London market, Andrew Weir, of Foxtons, said: "Last month alone we saw an increase of 20pc of new buyers registering with Foxtons compared to the same time last year and many prime London properties are attracting multiple offers and selling over the asking price.

"Because of this, buyers who had once focused upon properties in one particular area are more and more likely to have to expand their search."

Douglas Sleaper of Townends in Surrey said 12 buyers are registering for every new property that comes to market.

He said: "The severe shortage of new stock is driving prices up, in hotspots like Guildford."

James Butler, of Woods Estate Agents in north Bristol, said properties there have been selling for up to 3% over the asking price, due to the "big imbalance" between supply and demand.

In a reflection of the calmer northern market, Andrew Regan - of Regan and Hallworths in Wigan - said there is currently a "nice balance of supply and demand for stock".

Mr Regan said: "The market buoyancy has led to some sellers thinking they can list their property for more than its value, but we have been advising people to be realistic in order to help them get the best deal."

Source: Press Association

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