By Anthony O. Goriainoff
The average cost of property coming to the U.K. market increased slightly in February as new sellers adjusted their price expectations due to high competition and upcoming tax increases, according to data from Rightmove.
Stamp duty is a buyers' tax which is set to increase as of April 1 for many buyers.
The U.K. property website said the average price of property coming to the market for sale rose 0.5%, or 1,805 pounds (around $2,268) from January to 367,994 pounds. This comes after faster-than-usual price climbs at the beginning of the year and is below the longer-term average of an 0.8% increase. On year, February's national average asking prices are 1.4% higher.
Rightmove said that the slower price acceleration appears to be both a proactive measure--recognizing higher costs for some buyers with looming stamp duty changes--and a reaction to the record number of homes that came on the market early in 2025. It added that the average number of available homes for sale per estate agency branch remains at a 10-year high, thus reducing sellers' pricing power.
The rise in the stamp duty is set to affect some regions and types of homeowners more than others. While many first-time buyers in lower-priced areas won't be affected by the changes given many of these homes will be stamp-duty free, those buying a home for between 500,001 pounds and 625,000 pounds will be most affected. These hardest-hit buyers could face an extra 11,250 pounds in costs if the deadline is missed and a short extension not granted by the government, Rightmove says.
Overall, real estate activity remains robust in February, despite the number of new sellers coming to market slowing down since the record surge on Boxing Day and settling at 13% on-year growth. The number of potential buyers contacting agents about homes for sale is 8% ahead of the same time in the prior year, with the number of sales agreed 15% ahead.
Still, global economic news could temper this momentum and affect the market's outlook and sentiment, with attention turning to upcoming inflation and earnings figures, Rightmove says.
Write to Anthony O. Goriainoff at anthony.orunagoriainoff@dowjones.com
(END) Dow Jones Newswires
February 17, 2025 00:30 ET (05:30 GMT)
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