Average asking price on homes 'hits new record high'
The average price tag on a home leapt to a new record high of more than £307,000 in April as a last-minute rush of buy-to-let investors energised the market, a website has reported.
Across England and Wales, sellers coming to market are demanding £307,033 typically for a property - which is £3,843 more than in March - Rightmove said.
On April 1, a three percentage point stamp duty hike was imposed on people buying buy-to-let properties. Estate agents have previously reported dealing with a bottleneck of investors rushing to push sales through before the tax increase on this date.
Rightmove said the average price of a typical buy-to-let property - that with one or two bedrooms - dipped in April by £2,686 month-on-month to reach £182,926, as investors' interest in the market became more subdued.
But the knock-on effect of the earlier rush of investors has pushed the asking prices for properties higher up in the property chain higher - as it has unleashed a wave of "trader-uppers" - the website said.
The previous rush of interest in buy-to-let investment properties before the April 1 deadline has enabled people selling these homes to trade up to bigger properties. This has created stronger demand for properties higher up the ladder - in turn pushing asking prices for these properties up.
Meanwhile, the month-on-month fall in the asking price of a typical buy-to-let property could also now create further opportunities for first-time buyers, as they also tend to hunt for homes with two bedrooms or fewer.
Last week, a Bank of England survey of lenders found that demand for buy-to-let loans was expected to fall "significantly" in the coming months.
Rightmove's figures also showed that across the market in March, properties spent just 62 days on the market typically before they were snapped up, down from 79 days in January.
Across the country, Wales had seen the smallest annual growth in property asking prices, with a 1.2% increase taking the typical price to £178,975 in April.
Annual asking price growth in the East of England and the South East was now ahead of that in London. Asking prices in the East of England were now 10.8% higher than a year ago, while those in the South East were 9.4% higher. In London, asking prices were 8.7% higher than a year ago, at £646,200 in April typically.
Rightmove director Miles Shipside said: "Chains need a buyer at the bottom to enable everyone to move, and that was boosted by investors looking to avoid the 3% levy introduced on April 1."
He continued: "While some felt that there would be a stampede of existing landlords selling to other landlords, these figures indicate that many of those who sold during the buy-to-let rush were actually first-time sellers looking to trade up.
"They used the heightened demand from investors competing fiercely with first-time buyers to springboard themselves on to the next rung of the housing ladder.
"After several years of being held back from moving by post-credit crunch price doldrums, they have now benefited from a heady combination of price growth, historically cheap interest rates, and confidence of a quick sale with purchasers working to a tight deadline.
"Trader-uppers have now been unleashed and this has spread demand upwards and helped to form longer chains."
Mr Shipside said that while some first-time buyers may now step into the market and fill gaps left by buy-to-let investors, " sellers of properties with two bedrooms or fewer need to realise that with less overall demand they need to price cheaper to match first-time buyers and highly-taxed investors".
Rightmove also quoted the views of estate agents in its report.
Mark Manning, director of Manning Stainton in Leeds, Harrogate, Wetherby and Wakefield, said: "We had the highest level of exchanges since 2006 in March, and it's likely some of those happened sooner due to the tax change deadline.
"While instructions remain broadly on par with the first quarter of last year there is still the feeling that the shelves are pretty bare as we enter our busiest months of the year."