The average advertised cost has risen by £40,000 since the pandemic, compared with £9,000 in the previous two years
Rightmove reports the British asking price for homes rose 2.3% in February according to Rightmove.
The listing site said it was the biggest monthly increase in the 20 years it has kept records and meant the average advertised cost of a home was up by £7,785, to £348,804. The asking price of a home increased 9.5% in the past 12 months.
According to the website, the number of properties listed rose by 11% while the quality and quantity of buyers increased by 16%.
“This new record means that average asking prices have now risen by nearly £40,000 in the two years since the pandemic started, compared to just over £9,000 in the previous two years,” a spokesperson said.
These figures show a more comprehensive gap between buyers and sellers. Experts believe this will lead to house price inflation above annual salary increases.
First-time buyers may miss the opportunity to buy one of the few properties that are still available.
Wealthier buyers, many of whom have saved large deposits during the pandemic, are among those caught by the “fear of missing out”, which Rightmove said would continue to drive prices higher over the coming months.
Tim Bannister, the firm’s director of property data, said as Covid restrictions were lifted “we now have a group of movers who are looking to return closer to major cities, or at least within comfortable commuting distance of their workplaces”.
Many estate agents had difficulty getting asking prices during this pandemic. The lack of homes to sell could lead to bidding wars and the return of gazumping in hotspot areas.
London property prices, which had stagnated after the Brexit vote in 2016, recorded the biggest annual jump in inquiries to estate agents of any region – up 24% year on year.
The capital saw the largest annual price increase in the last five years. This was due in part to the lifting of pandemic restrictions and London’s return back to work.
Nationwide reported earlier this month that January sales prices rose 11% over the previous year. This makes 2022 the most robust year for house price inflation since 2005.
According to the building society, property transactions in 2021 will be at their highest since 2007, 25% higher than in 2019, and would surpass those in 2019.
Low inventory meant that there were not enough homes for sale, which has led to a gap between growing demand and increasing supply.
Knight Frank also reported on the fact that property values are rising fastest in London’s suburbs and home counties. These areas are increasingly popular because they offer better schools and more homes.
Tom Bill, the firm’s head of UK residential research said it was more reliable to use price per square foot as a measure of value, and while this put parts of central London at the top of the pile, many fashionable areas outside the capital were catching up.
He said all wards in England and Wales with a median property price of more than £1,000 per square foot were in London. Knightsbridge and Belgravia (£2,237) and the ward next door, Brompton and Hans (£2,022), were top of the list and the only two areas in the country where the figure exceeded £2,000.
However, two wards in Oxford – Summertown and Walton Manor – and three in areas to the south-west of London were the fastest risers.
“The market in north Oxford has the classic drivers of great properties, shopping, and schools,” said William Kirkland, the head of Knight Frank’s Oxford office. “From Summertown you can walk to some very good state and independent schools, which is why people are still choosing to come here from London.”