Stamp Duty frenzy shows first sign of slowing - Rightmove

The frantic growth in house prices is showing its first sign of slowing down, says Rightmove.

In its latest monthly market snapshot, the portal says asking prices rose 0.8 per cent - that’s the equivalent of £2,509 on the average asking price in just four weeks. 

This was the largest rise at this time of year since 2015, and prices are now at a record in all countries and regions of Britain.

However, Rightmove says high prices combined with an all-time low in the number of available properties on agents’ books are starting to slow the pace. Buyer demand is still ahead of supply but  sales agreed in May were only 17 per cent ahead of the same period in 2019, slackening from April’s figure of 45 per cent.

The number of sales agreed on properties over £500,000 in May was 49 per cent above the same period in 2019, despite buyers knowing they will miss the maximum stamp duty saving that comes to an end in June.

In terms of the regional picture, Welsh prices rose by 14.6 per cent since March 2020; South West England prices are up by 11.4 per cent with properties selling more quickly than ever recorded previously by the portal.

Tim Bannister, Rightmove’s director of property data, says: “Buyer demand remains very strong, though with an all-time low in the number of properties available for sale on estate agents’ books and new stock at higher than ever average prices, there are early signs of a slowing in the frenetic pace. 

“Since the market re-opened last May in England we have seen huge jumps in the numbers of sales being agreed, but these are now rising at a slower pace. Record low interest rates and stamp duty tax reliefs have helped many to afford higher prices, satisfying their pent-up desires for a new home fit for a new era. 

“Some of that demand has now been met, and the phasing out of stamp duty reliefs has also taken away some of the urgency to move, though our high traffic and search data indicate that there is still strong buyer demand. 

“However, higher prices combined with a lack of fresh choice coming to market are reducing some buyers’ ability or desire to move, and while we expect the market to remain robust, there are early signs of a slackening in the incredible pace of activity that we’ve seen over the last year. This super-charged activity cannot go on forever, but we expect the market to remain vigorous for at least the remainder of the year.”