In what is thought to be a rush to buy before interest rates were hiked upward making borrowing more expensive, hopeful home buyers showed up to the housing market and are still seeking affordable housing in which to climb onto the property ladder. The task will be difficult as the average asking price according to Rightmove, an online listing site for property, has exceeded the previous high and is now at £354,564. That level is 1.7% higher than in February or at a value of £5,760 more.

The average asking price is 10.4% higher than one year ago. 

Of the more expensive properties listed, such as the average asking price for a four bedroom, the increase was 3.8% or £23,619 this month. The average asking price for this type of property reached £647,112 according to Rightmove.

The increase in asking prices is due to strong demand and low supply. Demand was fueled during the lockdowns caused by the global pandemic because buyers sought a home that better served their pandemic lifestyle needs. The main features of sought after property offered more space for working and schooling from home and green space area outside for safe outdoor time for family and pets. 

Homeowners that stayed put rather than moving home sought out equity cash relief remortgages to put cash in hand to make improvements and upgrades to better serve their pandemic lifestyle needs. However, there were many that became home movers. 

First time buyers sought to escape renting or over-burdened multi-generational home life while borrowing was cheap due to historically low interest rates. Home movers, investors, and first time buyers crowded the housing market at levels unexpected by experts.

Demand has only grown as interest rates have been raised by the Bank of England’s Monetary Policy Committee (MPC) in the last three consecutive meetings. In December, February, and March the rate has gone from almost zero at 0.1% to 0.75%. 

Rate increases are only expected to continue to climb as inflation shockingly increases to levels not seen in decades. The war in Ukraine could impact inflation and strain the UK economy and global economy even more.

It could be the war itself alongside a pandemic that still is causing issues and warnings of possible variants on the rise that is pushing home buyers into the market. Perhaps it is the same desire for security and one’s own home that evolved during the pandemic that could possibly be helping to once more drive demand.

Borrowing is getting more expensive with rising interest rates, and coupled with the deep desire to be a homeowner and rising inflation on the horizon, demand will likely grow for months to come.