Record numbers of homeowners have made a new year’s resolution to sell their property.
Rightmove’s latest House Price Index for January shows average asking prices have increased by the largest amount for this month since 2020 as estate agents and property sellers start the new year in a bullish mood.
It comes as buyers try to beat the prospect of rising house prices once stamp duty thresholds drop in April, which will make it more expensive to buy a property.
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The latest Rightmove data for January shows the average price of property coming to market has increased by 1.7% on a monthly basis and by 1.8% annually.
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This is the largest increase in asking prices for this time of year since January 2020 and puts the typical price for a home on the market at £366,189.
The figure remains almost £9,000 below May 2024’s record, which Rightmove says reflects buyer affordability constraints.
Despite this, the property website has hailed a record start to the year for the property market.
New year, new housing hopes
Figures from Rightmove show that a record number of new sellers have come to the market since Boxing Day, giving buyers the highest level of choice at the start of a year since 2015.
The number of new properties coming to market is 11% ahead of the same start-of-the-year period last year, while the number of buyers contacting agents about properties for sale since Boxing Day is up 9% annually.
The number of sales being agreed over the same period is up by 11%.
But while a busy market is good news, Colleen Babcock, property expert at Rightmove, warns it could make it harder for those looking to sell a property.
She said: “The record number of sellers we’re seeing is a double-edged sword. It’s encouraging to see so many sellers with the confidence to come to market, providing buyers with fresh choice.
“However, with lots of homes for buyers to consider, sellers will need to work even harder to stand out from the crowd and attract a buyer.
"This could be with a tempting asking price, standout home features, immaculate presentation of the home, or a combination of all of these. It’s vital that in a competitive market, sellers take on the recommendations of their agent, particularly when it comes to setting a realistic price.”
Is now a good time to sell a property?
Interest rates and mortgage pricing are lower than the start of 2024, which bodes well for buyer demand.
Rightmove is forecasting 1.15 million transactions this year and predicts a 4% rise in asking prices.
It has recorded its busiest start to a year for mortgage in principle applications.
But despite the promising start to 2025, the property website has warned that there are uncertainties ahead.
It is unclear when interest rates will next be cut, especially with gilt yields rising amid concerns about tax rises in the UK. This could hit buyer demand if mortgage rates remain high.
Buyers will also be racing to beat the end of temporary increases to stamp duty thresholds in April.
That could mean purchasers are willing to pay more to secure a deal but on the other hand, sellers may have to accept discounts as the end of March nears to get a sale through.
Babcock said: “It’s important to look at the bigger market picture, despite the positive early lead indicators that we’re seeing.
“Many buyers are still affordability-stretched, with high mortgage rates restricting borrowing power and limiting what they can afford to pay. Meanwhile, first-time buyers have seen support schemes reduce and some also face higher stamp duty fees from April, all while contending with record rents and trying to save up for a deposit.”
This sentiment is reflected among estate agents.
Matt Thompson, head of sales at estate agency brand Chestertons, said: “January started where December left off. We are seeing steady demand from buyers who feel motivated to finalise their property search as soon as possible.
"This spike in buyer activity is boosted by current speculation about potential rate cuts, which is encouraging forward planning house hunters to begin or finalise their search now and lock in a favourable rate nearer the time of contracts being exchanged."
North London estate agent Jeremy Leaf added: “There is one thing that is more highly priced than any other when it comes to buying a home – and that’s stability. Stability generates confidence to take on longer-term debt and move home.
“Demand remains strong but worries persist, not so much about the likelihood of a reduction in interest rates but the pace of their decline, as well as Budget implications for the jobs market later this year. As a result, some buyers are pressing the pause button, especially as there is so much more choice of property evidenced in these figures.
“Nevertheless, the underlying desire to move has not disappeared – transactions are just taking a little longer although many first-time buyers are still trying to beat the March deadline for stamp duty increases."
