The average price of a property coming to the market has jumped by over £5,000 over the last month, according to property website rightmove.
That’s the equivalent of an extra 2.1%, with every region of England and Wales reporting a rise of some sort in asking prices.
And it’s all down to a significant lack of supply, with some estate agents reporting the number of quality properties for sale has never been lower.
Strong demand not met by supply
Rightmove reported seeing a bumper start to the year, with visits to the site hitting 100 million for the first time ever in January.
But that demand is not being met by the dwindling levels of supply. The average number of properties for sale per estate agency branch over the past two months has fallen to 57 and 58 properties respectively, new record lows for this time of year.
Pension reforms will make things even worse
[SPOTLIGHT]According to Rightmove’s figures, owner-occupation levels are now at 65%, down from a peak of 71% in 2003. That’s hurt supply levels, as buy-to-let investors tend to invest for the long term, meaning they don’t sell up as frequently as owner-occupiers.
And that situation is only going to get worse in the next couple of months, as thousands of pensioners – flush with cash thanks to the new pension freedoms – look to plough their savings into property.
Miles Shipside, director of rightmove, said estate agents were already reporting enquiries from retirees looking to put their money into buy-to-let properties from April.
Not everyone agrees
Rightmove’s report contrasts with the latest Residential Market Survey from the Royal Institution of Chartered Surveyors (RICS), which found that potential new buyer enquiries dropped for the seventh straight month across England and Wales. As a result, just 2% more surveyors reckon prices will increase over the next three months, its slowest pace since May 2013.
For more on this, read RICS: Scotland and Northern Ireland outperform UK housing market in January.