Cash investors fuel property price boom
New records have been set in UK house prices, Rightmove reported today.â€¨â€¨ The average asking price of a property new on the market has tipped Â£250,000 for the first time.
According to Rightmove, new sellers have bumped up their asking prices by 2.1% over the last month, The highest asking price previously was last June when it hit Â£246,235, and before that in May 2008 when it reached Â£242,500.â€¨â€¨The fifth consecutive monthly rise means that overall, national average asking prices are now 5.1% higher than at the start of the year.â€¨â€¨ Rightmove said this was the â€œstrongest price startâ€ to a year since 2004.â€¨â€¨The site itself has also seen record traffic, with 1.25 billion pages viewed in April, a 20% rise on last year. However, buyers have less stock to look at, with new instructions this year down 3%.
The turn-around appears to be almost totally south-based and fuelled by cash property investors who are buying buy to let property. They have plenty of cash and little need of mortgages.
â€œDespite a new national record, itâ€™s not â€˜green shoots of recoveryâ€™ across the board, especially for the deposit-strapped mass-market. They must wait patiently until January when the Help to Buy scheme extends to the resale market.â€â€¨â€¨ According to Rightmove, only two regions have asking prices which have slipped back on last year â€“ Yorkshire & Humberside, and the East Midlands, where they are down 1.1% and 0.6% respectively.
In some regions, the South-West and North-West, asking prices are more or less static, having gone up by 0.1% and 0.6% respectively.
The average asking price on Rightmove at Â£249,841 compares with the far lower â€˜soldâ€™ prices being quoted by Halifax and Nationwide,Â currently Â£166,094 and Â£165,586 respectively.