Average house price increased by 0.8% in September, twice as high as usual trend

The average price tag on a home soared by nearly £3,000 in September, a property website has revealed.

In Britain, the typical asking price for newly marketed properties rose by 0.8% or £2,974. This September witnessed a month-on-month price spike, with this year's 0.8% increase being twice that of the usual long-term trend, as noted by Rightmove.

A summer revival in market activity, compared to last year's more muted conditions around the same period, has largely powered this significant uplift, according to industry observers. The autumn housing market appears to be getting an extra push from various factors.

With mortgage rates on a downward trajectory, buyers enjoying a broader selection of properties to choose from, and salaries growing at a pace that outstrips inflation and house price rises, there appears to be a buoyant sentiment in the market, the report indicates. However, looming uncertainties persist, including the prospect of an additional Bank of England base rate cut following the recent trimming by 0.25 percentage points, and what may come with the announcements in the forthcoming October Budget, Rightmove cautions.

Rightmove's property science whiz, Tim Bannister, said: "The autumn action has started early with a strong rebound in activity from both buyers and sellers compared to the subdued market at this time last year, continuing the momentum from the better-than-expected summer market."

He added, "The certainty of a new Government followed by the first (Bank of England base rate) cut in four years invigorated the market, opening a window of opportunity for movers to act."

"Some of this will be pent-up demand from those who had to hit the pause button until now. However, windows of opportunity tend to need a momentum of good news to stay open, and there are still uncertainties ahead which could cause some of the current market activity to ease."

Rightmove observed that the average home is still spending 60 days on the market until a buyer is found, which is three days more than at the same time last year, hinting that buyers aren't rushing their decisions.

Mr Bannister offered advice saying: "Homeowners who are thinking of coming to market soon shouldn't let the increased activity make them over-optimistic and must price competitively to sell. With affordability still very stretched for many, choosy buyers are taking their time to browse the increased number of homes for sale and find the perfect home at the right price."

Jason Dainty, a co-founder of estate agency Hopkins & Dainty in Derbyshire, commented: "We're seeing more sellers coming to market, and overall we're seeing some positive sentiment amongst both sellers and buyers. Well-priced and attractive properties are still selling quickly, even getting interest on the first day of marketing. However, the price has to be right otherwise, they risk being ignored by prospective buyers."

This housing update comes as Hamptons releases their lettings index, revealing that the rental gap between the North and South of England is now at its narrowest since records began in 2013. The North-South rent divide is shrinking, with the average new tenancy in the South of England now costing £1,318 a month 37% more than the North, which averages at £960. That figure was down from last year's 43% gap and a significant drop from November 2021s high of 55%, according to figures by Hamptons.

Hamptons' head of research, Aneisha Beveridge, remarked on the trend: "Much like house prices, the rental North-South divide has been closing for the last five years. The narrowing reflects the cyclical nature of the housing market with house prices in the North of England rising 31%, nearly double the southern rate."

She added; "These figures have been mirrored in the rental market, with rents in the North of England quickly playing catch up. But it's only been in the last year that the gap has really started to narrow beyond the point we've previously seen. This has been driven by the slowing of rental growth across southern England caused by greater affordability pressures. While tenants in the South have seen weaker growth in percentage terms, in cash terms, they've faced big rises."

She illustrated the impact on Southern renters: "A 10% increase in South of England rents would cost tenants an extra £1,581 a year, £428 more than for a tenant in the North. Despite the pace of rental growth slowing, it's remained resolutely in positive territory, triggered by landlords' higher costs."