According to its house price index, asking prices were up 4.9% in Q1, the largest first quarter increase since 2004.
Activity is expected to fall back when the Stamp Duty holiday for first-time buyers ends on March 24. The government is unlikely to extend the tax break in the new Budget to be unveiled on Wednesday, said Rightmove.
Miles Shipside, director of Rightmove said “For a first-time buyer it’s already hard enough to raise the necessary deposit and now, as well as potentially losing between £1,250 and £2,500 in Stamp Duty exemption, asking prices for their target property types have increased by over £5,000 in the last year.”
London asking prices reached a new high at £455,159, up 7.3% year-on-year, and the average asking price in Kensington and Chelsea has broken the £2m barrier for the first time, with typical prices standing at £2,000,120 in the borough.
Rightmove said strong interest from overseas buyers has helped to boost the London market.
However, the Midlands, Wales and the North West have seen prices dip year-on-year and the West Midlands recorded the biggest annual fall, with asking prices dropping by 2.9% to £181,925.
Shipside added: “The traditionally buoyant spring market has combined with a shortage of supply and brisk turnover of property.
“The result is another new record for average asking prices in the capital this month, representing an increase of nearly £600 a week over the last year and underlining London’s continuing property market strength.”
