£300,000 milestone passed as price of newly-marketed homes hits new high

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As demand soars and supply remains tight, the average price of a property coming to market in England and Wales passes £300,000 for the first time

Challenges facing both first-time buyers and those trading up highlighted by 50% increase in just 10 years:

£100,000 jump in new seller asking prices from £200,980 in March 2006, to £303,190 today

Affordability constraints emphasised by average wage growth of only 22%1 over last 10 years

3% price jump in March (+£3,903) is second-highest at this time of year since the 2008 credit crunch

Momentum spreads north and west with six out of ten regions setting record price highs this month

London no longer leads the pack as prices stand still

The mismatch between supply and demand has resulted in six new record highs over the past twelve months in the price of property coming to market. However, this month sees a particularly significant milestone as the average breaks through and beyond the £300,000 mark for the first time. Today’s asking prices are now over 50% higher than they were ten years ago. This highlights the growing housing affordability gap now affecting more and more aspiring first-time buyers and potential trader-uppers.

Miles Shipside, Rightmove director and housing market analyst comments:

“While the start of 2016 has seen an encouraging but modest uptick in the number of properties coming to market, demand and momentum have combined to push prices over £300,000. On average 30,000 properties have come to market each week over the past month, up by 3% on this time last year, but there are insufficient numbers of newly-listed properties in many parts of the country to meet demand. Visits to the Rightmove website are up by 14% in early March compared to the same period in 2015, so it’s no surprise that those buyers who can borrow more or can find some extra cash are keeping the price merry-go-round spinning, even though increasing numbers of aspiring home-movers cannot afford the ride.”

Shipside adds: “More first-time buyers and would-be trader-uppers are finding themselves ill-equipped to cope with current house prices given the tighter lending criteria and average earnings lagging well behind house price growth. However, stronger growth in average earnings would not have helped the situation as it would simply have enabled buyers to bid prices up even higher, chasing the limited supply of suitable housing stock. In last week’s Budget the Chancellor could have encouraged landlords and second home owners to sell their properties and improve supply if he had extended the reduction in Capital Gains Tax to include those transactions. With no other significant property-related new measures in the Budget it at least allows time for his raft of recent initiatives to bed in.”
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