New data has shown that the average house price across the UK jumped by £3,800 in April as the market experiences a knock on effect from the buy-to-let rush of the previous months.
According to property website Rightmove the average asking price for properties in England and Wales rose 1.3 per cent to £307,033 in April; an increase of 7.3 per cent compared to the same month last year.
Rightmove have studied the latest growth and believe buy-to-let investors who pushed sales through in March, before the three per cent hike in stamp duty from 1 April, have unleashed a wave of so-called ‘trader-uppers’ and ‘second steppers’. This has led to increased demand for bigger properties, which has driven up the average price across the UK.
Rightmove’s Director Miles Shipside said. “While some felt that there would be a stampede of existing landlords selling to other landlords, these figures indicate that many of those who sold during the buy-to-let rush were actually first-time sellers looking to trade up.
“They used the heightened demand from investors competing fiercely with first-time buyers to springboard themselves on to the next rung of the housing ladder.
“After several years of being held back from moving by post-credit crunch price doldrums, they have now benefited from a heady combination of price growth, historically cheap interest rates, and confidence of a quick sale with purchasers working to a tight deadline.”
Last month also saw a number of lenders reducing their rates on buy-to-let mortgages to record lows in a drive to keep the market alive following the crackdown by the current government, which has reduced investors’ appetite in the market.
This trend may be short-lived though as indicated by the Bank of England’s survey of lenders, which found that demand for buy-to-let loans was expected to fall ‘significantly’ in the coming months.