The average price of property coming to the market for sale drops by just £21 this month (0.0%) to £375,110 after reaching a record high in May. Prices in June follow their familiar seasonal pattern of recent years and remain flat.
Less expensive and more northerly regions are seeing stronger price growth this month, with five of the six cheapest regions reaching new price records, while the higher-priced East of England and London lag behind.
The majority of buyers and sellers have continued their plans since the election was called, with the only sign of election caution being a slight drop in the number of new sellers, especially at the typically more discretionary top-end of the market.
Over the last four weeks, the number of sales being agreed has stayed steady at 6% higher than a year ago.
Buyer demand has also remained stable and is now 5% higher than last year. This supports Rightmove’s poll of over 14,000 people, where 95% of those planning to move home said that the election will not affect their plans.
In the two weeks since the surprise election announcement, the number of top-end sellers coming to market is 3% lower than a year ago, versus being 11% higher in the previous two-week period.
Stubbornly high mortgage rates continue to stretch affordability, with many future movers likely to have a closer eye on when the first Bank of England rate cut might be, rather than pre-election housing market promises. The average 5-year fixed mortgage rate is now 5.04%, compared with 4.94% in January.
Reaction
Nathan Emerson, CEO of Propertymark:
“It’s extremely positive to see stability within the housing market and despite a challenging period of high inflation and elevated interest rates, we are witnessing people approach the market with growing confidence.
“If conditions permit, we are hopeful to see the Bank of England start reducing the base rate when they next meet on Thursday.
“Should this happen, a potential raft of competitive mortgage deals over the coming weeks would be very welcome news for many people.”
Tomer Aboody, director of property lender MT Finance:
“With the general election looming, we are seeing some caution but overall confidence within the market, as buyers are not too frightened of what might come.
“As mortgage rates seem to be holding firm, some buyers are still waiting for a change, with indications looking like a reduction will be coming.
“With a Labour government likely, there are some fears of untold taxes which could affect the market. Help is needed within the property market, but will Labour listen and act?
“Northern markets are seeing a bigger boost in values and sales. The lower ends of the markets are usually the first to feel the difference whether positive or negative, due to the bigger market affordability within these price ranges.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman:
“Although only reflecting asking or aspirational prices, these Rightmove figures mirror a trend we have also noticed in our offices.
“Activity has reduced over the past few weeks probably more as a direct result of a likely delay in the cut of base rates than the forthcoming election. On the other hand, caution is more prevalent in demand for larger, more expensive properties where any tax changes are more likely to be felt after 4th July, whichever party is successful.
“Overall, viewings are down a little compared with the previous month, but buyers and sellers are in pause, not stop, mode as we’re not seeing unexpected withdrawals from transactions or serious re-negotiations.
“It’s still a buyers’ market generally so sellers must be realistic if they are to achieve their aims.”
Chris Baguley, group channel development director at Together:
“The housing market continues to strengthen, with the overall number of agreed sales up 6% and new buyer enquiries 5% higher compared to a year ago. With the announcements in last week’s party manifestos; buyers, sellers, investors and developers will be weighing up each side’s housing policies ahead of the July outcome. For first-time buyers, the scrapping of stamp duty could well be a huge boost to them taking their first steps onto the property ladder.
“House building and development will continue to be a key priority in the next few weeks – with a focus on repurposing brownfield land. With our research finding nearly a fifth (19%) of property professionals wanting more government support for brownfield development, it’s promising to see this recognised – but now is the time for real action.”
