House prices soar by nearly £8k in one month

21 February 2022, 14:48

The average asking price has risen by nearly £8,000.
The average asking price has risen by nearly £8,000. Picture: Alamy

By Sophie Barnett

The average asking price for a house in the UK now sits at a record level after it jumped by nearly £8,000 in February, new figures show, as demand continues to boom post-Covid.

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Rightmove, the UK's largest online property website, recorded its biggest ever monthly rise in February for the average asking price for a house.

The property site says typical price tags rocketed by £7,785, with sellers now asking for nearly £349,000 on average - a 9.5 per cent increase on this time last year.

It's the biggest month-on-month increase recorded by Rightmove in more than 20 years of its reporting.

The new record means that average asking prices have now risen by nearly £40,000 in the two years since the coronavirus pandemic started, compared to just over £9,000 in the previous two years.

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The jump comes as households face a cost of living squeeze, with energy bills set to soar in April along with a rise in National Insurance.

Ofgem reviewed its price cap on energy bills earlier this month, upping it by £693 per year to £1,971.

Bills will be capped at the updated rate between April and October, meaning another £58 on bills every month for the typical household.

Meanwhile, National Insurance will rise by 1.25% in April.

These hikes, paired with the rise in average asking price for homes, will pose a barrier for those hoping to get onto the property ladder.

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Tim Bannister, Rightmove's director of property data, said: "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.

"High demand and a shortage of available stock are supporting a rise in prices and a new record average asking price this month.

"The rising cost of living is undoubtedly affecting many people's finances, especially those trying to save up enough for a deposit to get on the ladder or to trade up.

"However, despite rising costs and rising interest rates, the data right now shows demand rising across the whole of Great Britain, with many people determined to move as we head into the spring home-moving season."

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Rightmove said February's price growth is being driven by the "second stepper" sector - comprised of buyers who may find themselves in need of more space and are now ready to move on from their first homes.

As some workers are being encouraged to return to the office, London has seen a particularly big jump in home buyer inquiries.