That’s the conclusion of new research from MoveStreets, which analysed data from the major property portals to establish the current average asking price across each region of Britain, versus what prices properties in those areas are actually selling for.

It found that while the average asking price across the portals currently stands at £296,950, properties are selling at an average of £258,464. That’s a difference of almost £38,500, or 13 per cent.

In some areas, this gap is far more pronounced though. In London for example, the average asking price is a mammoth £833,994, yet properties are selling at an average of £494,673, a disparity of 41 per cent. This is ahead of the large gaps found in the South West – 24 per cent – South East – 23 per cent – and Wales – 21 per cent.

By contrast, the study suggests that the most realistic vendors are found north of the border, with a gap of just four per cent between asking prices and transaction prices in Scotland.

Adam Kamani, CEO of MoveStreets, noted that the high levels of demand from buyers and the low levels of available stock had meant that properties “fly off the shelf at pace and for a very good price”.

However, he pointed out that many vendors were being “over-optimistic” with their asking prices, in an attempt to take advantage of the market boom.

He continued: “This can be detrimental to your sale regardless of how the market is performing and can result in months of little to no interest in your home. It’s the responsibility of the listing agent to guide sellers and set these expectations. While some will value a home at a higher price point to win business, a difference of ten to hundreds of thousand pounds above market value is perhaps a little too far.”

The latest study from Rightmove found that asking prices rose by an average of 1.8 per cent in October, with all regions seeing prices hit a new record high.

According to Rightmove’s house price index for October, this is the highest monthly rise at this time of year since October 2015.

The strong activity was partially driven by fast turnover of properties for sales and a “window of opportunity” before a potential interest rate rise later this year. This overcame a possible slowdown from the expiry of stamp duty incentives.

The report added that number of new sales being agreed was up 15.2 per cent in September but said that high demand was stalling recovery in depleted available stock.

It said that although number of new properties coming to market was higher than in the summer, stock levels were still an issue for the market.

According to the report, this imbalance provides an opportunity for owners to sell and cash out if they are downsizing or if they do not need to buy another property.

Tim Bannister, Rightmove’s director of property data said: “2021 has been the year of the power buyer, with those in the most powerful position to proceed quickly and with most certainty ruling the roost over other buyers who have to sell but have yet to come to market.

He added that one agent analysis showed that 87 per cent of their sales were to buyers who were ready to proceed was “typical” for many agents.

“Buyers being able to prove they are mortgage-ready or have cash in the bank helps them get up the pecking order. Whilst available stock for sale is still close to record lows, there are signs that this has stopped falling and stabilised this month, so fresh new choice is slowly growing,” he added.

He continued that as the end of the year approached many prospective buyers would be focusing on a having a normal Christmas so more “determined buyers” who sold their property could “act fast and buy with less competition.”

Managing director of Barrows and Forrester, James Forrester, said that the market had shown an “incredibly strong performance” despite the rollback of the stamp duty holiday.

He said: “We’re now seeing definitive proof that while the stamp duty holiday may have acted as a starting pistol where the property market revival was concerned, the race certainly hasn’t been run and this strong upward growth is unlikely to dissipate anytime soon.

“While it seems too soon to talk about Christmas, it won’t be long before it arrives and while many will be eyeing the New Year with regard to selling their home, now is the time to get your house in order so that come the 1 January you’re on the market and attracting interest.”

Director of Benham and Reeves, Marc von Grundherr, said the market was now seeing a second wave of activity as buyers avoiding “chaotic market conditions” of the past year entered the space.

He said: “With the market remaining particularly buoyant, those entering with a property to sell are pricing high and this has caused yet further growth where asking prices are concerned. While initial asking price expectations are perhaps a little over-optimistic, to say the least, a lack of stock to satisfy demand means that homes are selling fast and for a very good price.

“Full house” market conditions

The report said that all-time record highs were recorded in all regions and three UK sectors of first-time buyers, second stepper and top of the ladder.

The report said that the national average asking price for a first-time buyer went up by 0.8 per cent to £210,672 in October.

For second steppers it increased by 1.4 per cent to £315,386, whilst top of the ladder improved by 1.7 per cent to £630,819.

Regionally, the biggest monthly change in house prices was in the North West, which increased by 2.3 per cent to £232,639.

Wales also reported a 2.3 per cent monthly change, with average prices of £237,830.

In London and the South West, the monthly change was pegged at 1.9 per cent, bringing average house prices to £650,683 and £359,906 respectively.

The lowest monthly change was in the East of England, where the monthly price change was 0.1 per cent and average house price was £396,232.

Bannister said that these full house conditions were an “extremely rate event”.

Von Grundherr said: “We’re certainly starting to see stronger signs of a London market revival. House price growth across the capital has remained fairly muted in contrast to the rest of the nation but a return to the workplace and the return of foreign interest is starting to drive the market forward.

“Don’t be surprised to see London regain the property price growth top spot before the year is out.”

According to Halifax, annual growth reached 7.4 per cent reversing a three-month downward trend that saw yearly house price inflation fall from 9.6 per cent in May to 8.7 per cent in June, 7.6 per cent in July and 7.2 per cent in August.

Government figures on house price inflation recorded values growing at a much higher rate over the summer. In June, the Office of National Statistics recorded yearly growth at 13.2 per cent.

Wales and Scotland continued to record the strongest house price inflation of any UK region or nation, recording annual growth of 11.5 per cent and 8.3 per cent respectively. The average house price in Wales reached £194,286 in September, with Scotland recording an average house price of £188,525.

Russell Galley, managing director, Halifax, said: “While the end of the stamp duty holiday in England and a desire among homebuyers to close deals at speed may have played some part in these figures, it’s important to remember that most mortgages agreed in September would not have completed before the tax break expired. This shows that multiple factors have played a significant role in house price developments during the pandemic.”

One factor, said Galley, was the change in homebuyers’ preferences and lifestyle choices. The popularity of larger homes has pushed up prices at faster pace than smaller properties.

The price of flats has risen 6.1 per cent in a year, or £6,640, while detached properties have risen 8.8 per cent in value, costing a buyer an additional £41,000.

The rising pressures on the cost of living and threats of increasing taxes are expected to dampen demand in the coming months but the low cost of borrowing and improving labour prospects for those already in employment are expected to buoy the market.

Limited supply, said Galley, was the biggest factor underpinning the future of house prices. Estate agents have reported a continuing reduction in the number of houses for sale. The shortage is expected to underpin average prices, rather than the recent rate of price growth, into next year.

Andrew Wishart, property economist for Capital Economics, added: “Most mortgages approved in September will have been for purchases that will complete in October or November, so rather than a last-minute rush to secure stamp duty savings, the strength of the data suggests that we are right to expect that house prices will continue to rise after the tax break ends.”

On comparing the Halifax index with Nationwide’s report Wishart noted that while the building society’s measure showed only a small increase in prices in September, when analysing quarterly price growth, both indices show growth easing which he said could be attributed to the end of the stamp duty holiday.

“Nonetheless, the strong gain in the Halifax index in September suggests that we are right to expect house price growth to cool rather than collapse,” said Wishart. “Indeed, very limited [stock] suggests that strong competition between buyers for the limited number of homes for sale will support prices in Q4.”

It noted that house prices in some rural and coastal areas rocketed by three times the national rate in the year to July. For example, Conwy in North Wales has seen prices jump by 25 per cent over the past year, while North Devon prices have risen 22.5 per cent. House prices in Richmondshire in the Yorkshire Dales have grown by 21.4 per cent over the same period.

By contrast, the seven areas which have seen house prices fall were all found within London.

The ONS said that there was some evidence of people house-hunting in rural areas, ahead of cities, because of a change in their circumstances brought on by the pandemic, including the ability to work remotely. However, it added that there had already been a trend of people increasingly moving from urban to rural areas in recent years.

The report also highlighted that people who work in these tourist hotspots tend to earn less on average than the people who live there. It cited the example of the Cotswolds, where residents earn an average of 28.7 per cent more than those who are employed in the area. 

The ONS added that in tourist hotspots, workers tend to earn less than residents because of the types of jobs in these areas, which are often centred around hospitality. Not only do hospitality workers tend to earn less on average, but it is a sector that was hit particularly hard by the pandemic, with hospitality workers the most likely to be furloughed.

Locals can’t afford to stay

Sarah Coles, personal finance analyst at Hargreaves Lansdown, noted that this situation isn’t just difficult for families who can no longer afford to live in their hometown, but for the businesses whose employees are forced to leave town.

She added: “The ONS found this time last year that 29 per cent of people wanted to work from home at least part of the time in future, and 12 per cent of them considered relocating as a result. 

“We can’t be sure all this enthusiasm for homeworking has endured, as some people have become increasingly fed up after staring at the same four walls for another year, but there are still significant numbers ready for a change. It means buyers are flocking to the seaside and the countryside, and locals looking for a home of their own increasingly can’t afford to stay.”

That’s according to the latest house price index from property portal Zoopla, which found that the average time between listing a property and agreeing a sale continues to remain under 30 days, as it has since May. The firm noted that usually at this time of year, the time to sell would have risen to above 40 days. 

In addition, Zoopla pointed to buyer demand being 35 per cent higher than average levels recorded over the previous five years.

This heightened demand is continuing to push up house prices too, with Zoopla recording an average price of £235,000, the highest on record. Prices have now increased by £44 per day over the last six months, up from the £30 daily rise recorded in the preceding six months.

Looking at a regional level, Wales is seeing the highest rate of price growth at 9.8 per cent in the year to August, followed by Northern Ireland at 8.4 per cent and the North West of England at eight per cent.

In terms of cites, Liverpool continues to lead the way with prices up 9.8 per cent over the last year, ahead of Manchester on 8.1 per cent and Sheffield at 7.6 per cent. By contrast, London’s house price growth was recorded at just 2.2 per cent.

While the ongoing impact of the stamp duty holiday on house prices is open to debate, there’s no question it has boosted the Treasury’s coffers, with stamp duty receipts in July hitting almost £7bn, a new record.

Challenges ahead

Gráinne Gilmore, head of research at Zoopla, said that it was clear the ending of the stamp duty holiday had had little impact on buyer demand, with buyers still striving for properties that provide more space or allow for lifestyle changes.

She continued: “Balancing this however, will be the end of government support for the economy via furlough, and more challenging economic conditions overall, which we believe will have an impact on market sentiment as we move through Q4.

“We expect the market to remain busy compared to historical norms, and for price growth to remain in firmly positive territory at the end of the year, although lower than current levels of 6.1 per cent.”

The Cornish market town of Redruth – specifically the TR16 6ER postcode – has seen the largest increase in house prices across the UK over the past year. Homes there have gone up in value by 21.12 per cent, taking the average price to £305,734, said Money.co.uk.

The price comparison site said this is still slightly lower than the UK average house price of £315,059.

Newquay takes second place as house prices in the TR7 1NG postcode rose 16.43 per cent in value in the last year. The average house price there has increased to £445,451 – 41.39 per cent above the UK average.

Much of the top 10 was dominated by Preston, which saw house prices soar in the last year.

Highest risers

1. TR16 6ER, Redruth, 21.12 per cent

2. TR7 1NG, Newquay, 16.43 per cent

3. BL1 6HT, Bolton, 13.60 per cent

4. PR1 2ED, Preston, 13.46 per cent

5. PR1 5SY, Preston, 13.46 per cent

6. PR1 2ES, Preston, 13.46 per cent

7. PR1 3ST, Preston, 13.46 per cent

8. EX2 5EX, Exeter, 13.27 per cent

9. DE5 3RT, Ripley, 13.15 per cent

10. PR3 3NS, Preston, 13.07 per cent

Bargain property postcodes

The comparison site also looked at the cheapest UK postcodes and found that homes in Peterlee, County Durham, are the cheapest in the UK, with the average home selling for only £41,462 – 86.84 per cent less than the UK average.

Houses in KA1 5ER, Kilmarnock, Scotland also could see you make some huge savings, with homes costing a £51,044 on average, while St Helens, between Liverpool and Manchester came third. The WA9 1NG postcode costs an average of £63,842, making it 79.74 per cent cheaper than the average UK property while offering great transport links to bigger, metropolitan neighbouring cities.

Cheapest property postcodes

1. AL1 5HA, Peterlee, £41,462

2. KA1 5ER, Kilmarnock, £51,044

3. WA9 1NG, St. Helens, £63,842

4. HU6 9ED, Hull, £66,244

5. HU8 8UB, Hull, £69,687

6. L4 5TS, Liverpool, £70,111

7. SA5 5ED, Swansea, £76,572

8. L35 5EN, Prescot, £78,025

9. L4 1RS, Liverpool, £78,747

10. CH41 5ES, Birkenhead, £81,527

In the town, a bottle of wine will set you back £4.50 (the cheapest cost throughout the UK) and it’ll cost you £19 for two cinema tickets.

The second most affordable place for couples to live is Newport. In the third-largest city in Wales, you can get the cheapest monthly transport pass at £60, two cinema tickets for £18 and a three-course meal for two for £45.

In third position is Cardiff with the average rental costs around £566.79 for a one-bedroom apartment. A trip to the cinema is one of the cheapest in the research at £10 for two tickets, Flowercard revealed.

The least affordable towns and cities for couples to live in

The top three least affordable towns and cities were Wolverhampton in third place, London second, with Brighton and Hove topping the list.

A one-bedroom house in Wolverhampton will set you back £158,627 with the average rent on a one-bed costing £519.50 a month.

London was at number 49 of the 50 towns and cities with the average price of a one-bed coming in at £388,394 and the average rent costing £1,483.35 a month.

Brighton and Hove are the least affordable places for couples to settle down, according to the data. Average monthly rental prices for a one-bedroom apartment are currently ​​£934.04, while a one-bedroom house to buy costs about £220,758.

That’s according to the latest global house price index from Knight Frank, which tracks house price movements across 55 countries and territories.

It found that in the year to June 2021, prices grew by an average of 9.2 per cent, with Turkey seeing the strongest growth at 29.2 per cent, ahead of New Zealand (25.9 per cent), the United States (18.6 per cent) and Slovakia (18.6 per cent).

The United Kingdom took 12th spot in the study, with growth at 13.2 per cent. It’s the highest rate of annual growth seen in 17 years.

In total, 18 nations and territories registered price growth of at least 10 per cent, up from 13 in the last quarter and seven a year ago.

Only India and Spain saw prices drop over the year, the lowest proportion of nations registering a decline in prices since Knight Frank started compiling the global house price index in 2008.

Knight Frank noted that there was a clear divide between developed and developing nations. Ten of the world’s developed nations averaged price growth of 12 per cent over the 12-month period, more than double the 4.7 per cent rate of growth seen in developing economies.

Knight Frank warned that there were signs of “softening demand” in some markets, noting that in the US, mortgage applications have dipped, while the share of households thinking now is a good time to buy has fallen to just 28 per cent, the lowest level in a decade.

The report added: “The prospect of interest rate rises in markets such as New Zealand, the US and the UK is also likely to weigh on buyer sentiment in the medium term.”

A study last month by Comparethemarket.com, based on data from the Office for National Statistics, suggested that house prices in the UK could jump by as much as 30 per cent over the next decade.

A net balance of plus 73 per cent of survey respondents reported rising prices, compared to the plus 81 per cent seen in recent months.

This was coupled with agents reporting falls in the number of properties making it to market, with a net balance of plus 37 per cent of those surveyed saying listings had fallen over the last few months. Listing levels have fallen for eight out of the last nine months, resulting in estate agent stock levels dropping close to record lows.

RICS noted that new buyer enquiries fell for the second month in a row as well, with a net balance of  negative 14 per cent of respondents saying they saw fewer house hunters, a further decrease from negative nine per cent of respondents in July.

Tarrant Parsons, economist at RICS, said that the latest results inevitably pointed to the market “taking a breather” following the frenzied activity seen ahead of the first Stamp Duty holiday deadline.

He continued: “That said, while momentum has eased relative to an exceptionally strong stretch earlier in the year, there are still many factors likely to drive a solid market going forward.”

Lack of stock means price rises will continue

Tomer Aboody, director of MT Finance, said that while the scale of recent price growth was unsustainable, the fact that there is a reduced amount of housing stock available for sale meant that prices would continue rising, albeit at a slower pace.

Aboody added that the fact that borrowing is still relatively cheap will also boost house prices.

He continued: “The stamp duty holiday incentive has proven to be an overwhelmingly successful trigger in getting the housing market moving. It has increased productivity, providing a certain indication as to where and how the government can encourage future activity by reforming stamp duty levels.” 

Renewed activity

Jeremy Leaf, a former residential chairman of RICS and now an estate agent, said that he was seeing demand reducing in part because of the tapering away of the Stamp Duty holiday, but also because many would-be buyers and sellers have been on holiday.

Leaf added: “In the past few weeks, the return to work and school has contributed significantly to renewed market activity. Encouragingly, we have also noticed an increase in valuation appraisals which should help to redress the sharp imbalance between supply and demand as well as further help to keep prices in check.”

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