Zoopla: May was the busiest month for home purchases since 2021, but asking prices still declined

When the post-Easter lulls and higher stamp duty thresholds have passed, buyers are back on the market, but average sales are £16,000 below asking price

According to Zoopla's most recent house price index, the number of agreed-upon property sales in May is the highest in four years; however, in order to get a deal, sellers are lowering their asking price by an average of sixteen thousand dollars.

The average price of a home in the UK is 268,250, which is 1 point 6 percent more than it was a year ago. This represents a 4,330 increase over a 12-month period, according to Zoopla. However, Zoopla stated that sellers must continue to price their homes using a "realistic approach" in order to guarantee ongoing buyer interest.

According to independent data, the typical home sale is currently being negotiated at a 3 percent or 16,000 lower asking price, which has remained consistent over the past few months.

Due to the expiration of the temporarily higher stamp duty reliefs in April and the Easter holidays, growth in sales and mortgage approvals had slowed in recent months.

Sales, however, have resumed their upward trend and are now 6% higher than they were in May of the previous year.

Homebuyers can now borrow up to 20% more, and lenders are changing how they evaluate borrowers' ability to pay higher mortgage rates. This has bolstered consumer confidence, which has led to a rise in agreed sales, according to Zoopla.

Additionally, there are more houses for sale than there were a year agoa 13 percent increase.

"More houses for sale mean more buyers looking to move home," stated Richard Donnell, executive director at Zoopla. This, along with more alluring mortgage offers and modifications to the way lenders determine affordability, is encouraging more sales to be agreed upon.

We anticipate that sales will continue to increase during the second half of the year, and that by the end of the year, UK home values will have increased by 2%.

Where in the United Kingdom is the most active housing market?

As employment growth increases demand and house prices, the North West's cities are seeing the biggest increases in property prices.

Demand is shifting into nearby and easily accessible areas, which is driving up home values and rents in major cities like Manchester and Liverpool, where prices have risen by 2.5 percent and 3 percent, respectively.

Apart from Blackburn (5point 8 percent), other North West cities such as Birkenhead (4point 1 percent) and Wigan (4point 4 percent) are also seeing rapid increases in home values.

Crown Estates and Lettings Agents' Martin Bennett reported that he was observing a rise in demand for both high-end and low-end real estate.

House prices are reflecting this, with the average asking price for an entry-level property in Blackburn now at around 75,000, up from about 50,000 two years ago.

"I have found that properly priced properties typically go under offer within two weeks of being listed, and it's not unusual to have ten or more prospective buyers on the first day of viewings.

City-by-city variations in house price growth range from slight declines in Aberdeen (-10.4%), Brighton (-0.4%), and Bournemouth (-0.4%) to price increases of more than 5% in Belfast (6.1%).

Markets outside of southern England typically have the fastest rates of growth. Faster sales growth causes the number of available homes to decline more quickly in those areas, which restricts the supply and accelerates the rise in home prices.

There are more houses for sale in Southern England.

Southern England now has a much greater selection of homes for sale, which is greatly increasing buyer choice and containing price increases. Growth has slowed as a result of the South West having 21% more homes for sale than it did at this time last year, with London and the South East having 17% and 15% more, respectively.

This, in conjunction with affordability issues, explains why house prices have grown by less than 1 percent in all of southern England, ranging from 0 to 5 percent in the South East to 0 to 9 percent in the South West.

Just 3% more homes are available for purchase in the North West and 5% more in Scotland than they were a year ago.

House prices are 3 percent higher in the North West and 2 points 9 percent higher in Scotland, with above-average price increases seen in northern England and Northern Ireland. This can be explained by fewer available homes for sale, better affordability, and faster sales growth.

Because homes are more reasonably priced in the northern parts of England and Scotland, there are more sales and higher price increases, according to Zooplas Donnell. Affordability still has an impact on price inflation and the volume of agreed sales in southern England.

"Depending on where they live in the UK, buyers and sellers must use different strategies; however, all sellers must remain grounded and set reasonable expectations for prices.