UK Asking Prices Rise in May, Reflecting Positive Economic Outlook and Increased Buyer Demand

According to property website Rightmove, asking prices for homes in the UK increased by the highest amount this year in May. The average price rose by 1.8% from April, driven by a more positive economic outlook and steady mortgage rates.

This growth in confidence may be due to the fact that earlier predictions of a downturn in the housing market have proven unlikely as the economy has shown resilience and avoided a recession. While borrowing costs have eased since a peak in September, they remain higher than before the financial market turmoil in the autumn.

Rightmove also reported a 3% increase in buyer demand compared to May 2019, before the impact of the coronavirus pandemic. However, other indicators have provided a mixed picture, with some suggesting slower growth in property prices.

The Resolution Foundation estimates that 1.6 million households in the UK will face an average increase of £2,300 in their fixed-rate mortgage bills as these deals mature over the next year.

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