The Rightmove House Price Index also suggested that this rise in the average asking price defied a decade high for the number of homes on the market and a boost in buyer activity.
It was also the first monthly price record since May last year, which Rightmove said was a sign of “continuing market resilience”. The firm said although this was a positive sign for the state of the housing market, new sellers still needed to be cautious when setting their asking price, saying homes that were priced right at the start of marketing rather than reduced later were more likely to find a buyer.
Colleen Babcock, property expert at Rightmove, said: “We’ve seen our first price record in nearly a year, despite the number of homes for sale being at a decade high. The increased choice seems to be bringing more movers into the market, with both buyer and seller numbers up as the market remains resilient.
“Confidence from new sellers is a good sign for the overall health of the market, but they do need to be careful when setting their asking price. The high level of supply in the market right now means that buyers are likely to have plenty of homes in their area to choose from, and an overpriced home will stick out for the wrong reasons.”
Sara Palmer, sales and distribution director at Shawbrook Retail Mortgages, said it was “encouraging” to see the property market remain resilient, but added: “We’re likely to see this activity start to slow in the coming months as first-time buyers are hit with an extra cost.
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“Whilst the government’s homebuilding targets will certainly help alleviate demand for housing and ease affordability concerns, this does little to help first-time buyers in the short term. With this in mind, hopeful homebuyers should make sure to keep an eye out for any further announcements from the government and consider speaking to a mortgage broker for clarity on pathways to homeownership.”
Buyers and sellers undeterred by market changes
The recent stamp duty change did not appear to impact market activity, Rightmove said, with most movers pressing on and completing sales. However, it said the effects of President Trump’s tariff announcements were still unfolding and while it was too early to see what it would do to the market, the prospect of lower mortgage rates could boost buyer affordability.
Rightmove found that since the stamp duty threshold rose, the level of agreed sales falling through had remained steady, suggesting there was no significant rise in people pulling out of transactions due to the tax rise.
The queue of buyers waiting to complete a purchase fell by 4% or around 24,000 transactions, however, as others were able to complete before the deadline. Rightmove said this was the first time the queue had dropped during March since 2020, but it had started to rise again.
New buyer demand in March was 5% up on last year and there was a 4% lift in the number of new sellers coming to market.
It was a different picture across the regions, as most of the Midlands, Northern regions, Wales and Scotland were recording above-average rises in demand compared to last year and had seen new price records.
By contrast, properties in the South West and South East were witnessing smaller rises in buyer demand and prices. London bucked this trend, as despite being the only region with less buyer demand than last year, average asking prices rose to a new record, primarily driven by Inner London.
Babcock added: “It’s important to remember that among records and national trends, Great Britain’s housing market is made up of thousands of diverse local markets, each uniquely responding to market changes and world events.
“London, for example, is likely to see greater knock-on effects from US tariffs than the rest of Great Britain, while Northern regions appear to be performing more strongly post-stamp duty rise. It’s difficult to predict what the next few months will bring, but if mortgage rates reduce more quickly, it would be a helpful boost to buyer affordability.”
Tomer Aboody, director of MT Finance, said: “So far this year, it has been a positive few months for the housing market, with transaction levels improving, although still below pre-pandemic levels. This comparatively subdued activity illustrates how big an impact higher interest rates have had on the market and sentiment.
“All eyes are on the Bank of England to see whether there will be a further reduction in May, with any assistance here likely to boost activity now that the stamp duty concession has ended. Indeed, buyers may await further reductions before making their move.”
