Rightmove House Price Index February 2019

Rightmove House Price Index February

We read with interest the Rightmove House Price Index for February which is showing a national average price of newly-marketed property rises by 0.7% (+£1,981). They say this is consistent with the average 0.6% February uplift in the previous two years with the average annual rate of growth at only 0.2% (+£714).

The Rightmove House Price Index February states that with annual wage growth of 3.4% (*ONS data on average weekly earnings, released on 22nd January 2019) is now outstripping asking prices at the fastest rate since 2011, improving buyer affordability.

  • Average price of newly marketed properties rise 0.7% this month
  • Annual rate of growth at 0.2%
  • Annual wage growth is now outstripping asking prices at fastest rate since 2011*

There is the usual north-south divide but with new sellers in all northerly regions have the pricing power to ask more than a year ago, with six of these seven regions seeing annual price growth in excess of 2%. Whereas prospective buyers in three of the four southern regions are seeing new seller asking prices cheaper than a year ago, indicating that buyers have the upper hand over sellers.

Some signs of buyer hesitancy with number of sales agreed in January down 4% on prior year – will improving buyer affordability overcome uncertain political backdrop?

Market Overview

National average asking prices of newly-marketed property rise by 0.7% (+£1,981) this month. This is consistent with the recent norm for this time of year which saw an average 0.6% February uplift over the previous two years. However, as we enter the traditionally more buoyant spring market the average annual rise of 0.2% (+£714) is the most subdued that Rightmove has recorded at this time of year since 2009.

As a result, and with average wage growth now running at an annual rate of 3.4%, buyer affordability is improving at the fastest rate against average new seller asking prices since 2011.

Miles Shipside, Rightmove director and housing market analyst says: “Longer daylight hours and green shoots appearing in gardens herald the start of the traditionally more buoyant spring market. Sellers’ subdued pricing is now being outstripped by higher average wage growth, meaning that buyer affordability is on the rise at the fastest rate in nearly eight years. Buyers are also being given the leg-up by cheap mortgage rates, if they can meet lenders’ criteria and lay their hands on a large enough deposit. In theory the scene would be set for an active spring if it were not for the uncertain political backdrop. As it is, the extent of that activity will depend on the degree of hesitancy among sellers to try to sell and be realistic on price, and buyers overcoming short-term uncertainty and taking a medium-term view that this is a good time to buy. As always those decisions will also be influenced by local market dynamics.”

Sellers in London test higher prices

The Rightmove report goes on to state that average price of property coming to market in the capital rises by 3.4% (+£20,210) this month, a typical surge at this time of year as owners of higher-priced property act ahead of the spring selling season.

However, despite this monthly rise, new seller asking prices are still 2.1% (-£13,409) below those of a year ago, with only Zone 1 properties showing a rise and Zones 2-6 falling by an average of 2.2%.  Inner London sees an average monthly change of 5.0% as owners of more expensive properties test the market, whilst Outer London is more subdued with a 2.2% monthly rise.

You can read the full Rightmove House Price Index here

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