Housing market bounces back as sales rise to four-year high

This has resulted in the number of sales agreed in May running at its fastest rate in four years, since the pandemic boom of 2021.

Overall, 13% more homes were put on the market compared to the same month a year ago – with improvements also seen in the cost and availability of mortgages. A change to how mortgage affordability is calculated means borrowers can afford to borrow 20% more than earlier this year.

Zoopla’s House Price Index also shows average UK house prices are 1.6% higher than a year ago, at £268,250 – an increase of £4,330 over the 12 months.

Separate data shows the average home sale currently being agreed is three percent below the average asking price.

As for regional differences, the findings show that the North West was the hottest area for price rises.

This has been driven by higher home values and rents in large cities like Manchester and Liverpool, where prices have increased by 2.5% and three percent respectively, pushing demand into adjacent and accessible areas – boosting house prices.

Southern England, meanwhile, has seen an increase in the number of homes for sale – significantly boosting buyer choice while also keeping price growth in check.

Overall, there are 21% more homes for sale in the South West, 17% more in London, and 15% more in the South East compared to this time last year. This, along with affordability constraints, explains why house price growth is less than one percent across all regions of southern England – from 0.5% in the South East to 0.9% in the South West.

Reflecting on these findings, Zoopla executive director Richard Donnell said: “More homes for sale means more buyers looking to move home. This, coupled with more attractive mortgage deals and changes to how lenders assess affordability, is supporting an increase in the number of sales being agreed.

“There are more sales and stronger house price increases in northern regions of England and Scotland, where homes are more affordable. In southern regions of England, affordability continues to weigh on price inflation and the number of sales being agreed.

“Sellers and buyers need to adopt different tactics based on where they live across the UK; however, all sellers need to keep their feet on the ground and be realistic on pricing expectations.

“We expect sales to keep rising over the second half of the year, with UK home values on track to be two percent higher by the end of the year.”