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Asking prices rocket to record high of £372,894

Christina Hoghton
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Christina Hoghton

Despite the rise, agreed sales numbers are currently 3% behind their pre-pandemic level

Asking prices hit a record high in May, as new sellers respond to improving market conditions, said Rightmove.

The property portal said that the average asking price of property coming to the market jumped by 1.8% to reach a new record of £372,894.

This monthly increase is ‘the biggest of the year so far’, and is significantly higher than the historic average May rise of 1%.

Sales numbers lag

Agreed sales numbers are currently 3% behind the pre-pandemic market of 2019, although Rightmove said buyer demand was up 3% over the same period.

The discount from final asking price to agreed sale price has steadied at an average of 3.1%, which the property portal said reflected ‘home-mover confidence in the outlook for the market’.

Average mortgage rates remain steady despite another increase in the Bank of England base rate. The average five-year fixed, 15% deposit mortgage is now 4.56%, compared to 4.52% last week, but 5.89% last October.

Tim Bannister, Rightmove’s director of property science, said: “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.

“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.”