First-time buyers and second-stepper sectors hit all-time price highs of £189,840 and £272,031 this month, the Rightmove House Price Index found.
The average asking price of newly-marketed property jumped by 1.5% (£4,503) in March. This was as strong demand from homemovers in the first two months of the year now feeds through to stronger upwards price pressure.
The price rise has been exacerbated by a dip in supply, with 5% fewer properties coming to market compared to the same period a year ago, and buyers looking to benefit from possible stamp duty savings or beat forecast interest rate rises.
Miles Shipside, Rightmove director and housing market analyst, said: “Many buyers entering the traditionally busy spring market this year face paying more than ever for their target property, and having a more limited choice.
“High demand and limited supply in parts of the country mean that the average price of newly-marketed property is at its highest ever level in four out of eleven regions.
“There is also upwards price pressure in the lower and middle market sectors with both first-time-buyer and second-stepper properties at new national record price highs.
“The first two months of 2018 saw Rightmove traffic at its highest ever levels, and this demand appears to be now feeding through to fuel the substantial £4,503 jump in average new seller asking prices this month.”
New records in the price of property coming to market have been set in four out of 11 regions this month.
The 1.5% increase this month is the largest seen at this time of year since 2007. However, with January and February price rises having been somewhat subdued this year, there may be an element of catchup supplementing this month’s 1.5% figure.
Over the first quarter of 2018 the price of property coming to market is up by 3.0%. This is a stronger performance than the first quarter of 2017 (+1.9%) but weaker than the 3.6% rise in 2016 which was inflated by the rush to beat the stamp duty deadline on second homes.
Shipside added: “It remains to be seen if this month’s 11-year price rise high for March is a catch-up anomaly after two more subdued price rise months, or an early sign of price pressure building up a real head of steam as we enter the spring market.
“Either way, sellers need to be mindful of increasingly stretched buyer affordability, and the more they increase prices the more buyers will hit their ceiling on the amount they are able to save for a deposit and borrow for a mortgage.
“There does however still seem to be potential price headroom in parts of the country, especially in some of the regions in the north, and in the more mass-market sectors.
“However, sooner or later higher prices tend to mean fewer people can afford to move, and that is one of the factors keeping the annual rate of increase subdued at 2.1%.”
The average price of newly-marketed property has hit all-time highs in both the East and West Midlands, and also in Wales and the North West.
First-time-buyer properties (two bedrooms or fewer) have hit an average of £189,840, 0.5% higher than their previous high seen in June 2017.
Second-stepper properties, (three or four bedrooms excluding four-bedroom detached), are now coming to the market at an average price of £272,031, 0.9% dearer than their previous high recorded in October 2017.
Price rises are in part being driven by a decrease in supply as the market enters a traditionally busy phase. Rightmove measured 112,693 properties coming to market in the last four weeks, down by 5.2% on the same period a year ago.
Some of this drop will be due to the heavy snow delaying some agents and sellers from bringing properties to market.