Asking prices for UK homes hit a new record high over the past month as families in search of bigger properties brushed aside uncertainty caused by Brexit and June’s general election.
Prices sought by sellers rose 1.2% in the four weeks to 13 May, pushing the average asking price to a fresh peak of £317,281, according to the property website Rightmove.
Families with children under the age of 11 were twice as likely as the average person to be moving home, as they looked for bigger properties in school catchment areas. Asking prices for typical family homes – with three or four bedrooms but excluding detached properties – rose by 5.4% year-on-year over the last month, to £270,953.
Miles Shipside, a Rightmove director and housing market analyst, said such families were more willing to ignore any uncertainty caused by Brexit and the general election.
“As well as that shrinking house feeling, parents with young children also have the pressures of travelling times to amenities as well as the weekday school commute. These have to be balanced against under-pressure finances, even more so when the sector with the property type that suits them best is seeing the biggest price jump.
“What seems to be happening is that moving pressures are understandably taking priority over electioneering and Brexit worries. For many in this group, it seems that moving is definitely on their manifesto.”
The 1.2% rise in overall asking prices was the fifth monthly consecutive rise, and followed a 1.1% increase a month earlier.
Rightmove said the run-up to the general election and broader Brexit uncertainty was failing to knock broader market momentum, with year-to-date sales agreed 2% higher than the previous election year of 2015.
“It would seem that this month’s report points to the majority of movers being nonplussed about the election, with their moving plans being driven by circumstantial factors that can’t wait, eg a growing family,” said Brian Murphy, head of lending for Mortgage Advice Bureau.
“The data from Rightmove does tally with Mortgage Advice Bureau’s observations of the market in April with regards written business, which saw one of the busiest weeks on record at the latter end of the month, underpinning consumer confidence and that, despite the current economic and political climate, for many it’s a case of keeping calm and carrying on.”
Rightmove said the outlook for the housing market in the second half of the year was more uncertain. Economists believe households will become increasingly reluctant to commit to major purchases as inflation climbs higher and wage growth remains weak. UK workers are already suffering from falling real wages, as prices rise at a faster rate than pay.
“It remains to be seen how much momentum may drop away in the second half of the year with stretched affordability a problem for potential buyers, though competition among lenders who are keen to lend will help some to push their budgets higher,” Shipside said.
