The number of agreed property sales in May reached its highest rate in four years, Zoopla’s house price index has revealed.
There’s been a 13% year-on-year increase in homes for sale, while mortgage cost and availability has improved in the past two years.
Indeed, Zoopla said changes to how mortgage affordability is calculated mean borrowers can afford to borrow 20% more than earlier this year.
Richard Donnell, executive director at Zoopla, 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 2 per cent higher by the end of the year.”
UK house prices are 1.6% higher than a year ago at £268,250, an increase of £4,330 over 12 months.
However, Zoopla warned sellers to maintain a realistic approach to pricing their homes, especially when buyers now have more to choose from.
The strongest price gains are being registered in cities across the North West, as employment growth boosts demand and house prices.
Higher home values and rents in large cities like Manchester and Liverpool, where prices have increased by 2.5% and 3% respectively, are pushing demand into adjacent and accessible areas, boosting house prices.
In addition to Blackburn, home values are rising fast in other North West cities, including Wigan (4.4%) and Birkenhead (4.1%).
Toby Leek, president of NAEA Propertymark, said: “Even during a time of economic turbulence, it is encouraging to see that the housing market is the busiest it has been since May 2021, and that house price inflation remains stable.
“This news demonstrates that there is still an appetite for housing as inflation in general continues to impact the wider economy.
“However, with the North West becoming the UK’s most popular housing market, it shows that more work needs to be done to even out house prices throughout the country so that people living in certain regions do not get priced out of the local housing markets there.
“It is vital that government policies across the UK are geared towards that aim.”