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February 16, 2010    

Average asking price of a UK home up 3.2%

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by Gill Montia

Rightmove has reported that a scarcity of new sellers bumped up asking prices by 3.2% in the four weeks to mid-February, taking the average asking price for a UK home to £229,298.

The figure compares with £222,261 in January, which saw a monthly change of 0.4%.

The leap set a new record for London at £427,987, and the property portal describes the rise as “reminiscent of boom-times”, adding, “there has been no higher rise since April 2007 when we saw a 3.7% increase”.

However, despite record search activity on rightmove.co.uk in January (up 29% on the same period last year) the company warns that economic fundamentals cannot support further asking price increases of this magnitude.

The firm’s commercial director, Miles Shipside, explains: “Many of those searching are likely to have a degree of nervousness about the economic outlook, with only 11.1% of those surveyed believing that the country’s current economic conditions are favourable.”

He adds: “Sellers are starting to appear in greater numbers, but they must realise this market is more akin to the mortgage-rationed times of the 1970s and 1980s than to more recent times of relatively easy mortgage availability … if sellers return to the market in larger numbers the current upwards price pressure will not be sustainable with the restricted number of buyers.”

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