Increase exceeds historical trends for this time of year

Average house prices in March increased by 1.5% or £5,279 to reach £368,118, according to Rightmove’s latest house price index.

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The average asking price for homes in the UK has risen by 1.5% in March, while buyer demand in London and for top end properties has grown significantly

This represents the largest monthly increase for 10 months, which Rightmove said signalled the continued recovery of the housing market after a muted 2023.

This 1.5% increase surpasses the typical average rise observed in March, which historically stands at 1%. Year-on-year house prices have increased by 0.8%.

Additionally, sales increased 13% compared to March last year, and buyer demand remains 8% higher than the previous year. Rightmove said the increase in buyer demand has been led by the largest homes sector and London, markets which are less sensitive to mortgage rate fluctuations. 

Agreed sales of ‘top-of-the-ladder’ properties, which covers all five bed properties and above, as well as four bed detached houses, are 18% higher than last year. 

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London has seen the biggest increase in buyer demand, both overall and for properties at the top end of the market, compared to this time last year.

With average asking prices still £4,776 below the peak observed in May 2023, Rightmove has said that potential buyers have identified ‘a window of opportunity’ to enter the market.

However, according to Rightmove, the lack of measures in the Spring Budget aimed at helping first-time buyers or the mortgage market has resulted in “an immediate pause in interest from some buyers”.

Tim Bannister, director of property science at Rightmove, said: “March is typically a strong month for asking price growth, as both buyer and seller activity levels rise and the spring selling season gets underway.

”However, the stronger than usual price growth this March indicates that new sellers are feeling much more confident, with some perhaps being over-optimistic, that there is enough buyer activity and affordability in their local market to achieve a higher price”.

Marc von Grundherr, director of estate agent Benham and Reeves, said: “While mortgage affordability remains an issue, it certainly hasn’t dampened the appetite of London buyers and we’ve continued to see a high level of activity at all price thresholds, but particularly across the super prime market.

”Buyers at the very top end of the ladder are acting with great confidence, with the higher cost of borrowing not presenting the same obstacle as the average homeowner. As a result, we’re seeing high demand for super-prime stock and many more buyers circling due to a more constrained supply of suitable properties in this sector”.