A surge in buyer demand, strong seasonal expectations and optimism of further reductions in mortgage rates have driven UK home prices higher, according to Home.co.uk's Asking Price Index for April.

But while this burst in sales activity pre­sents several positive metrics regard­ing the current UK housing market, it is important to also note some dark clouds on the horizon, warns the property website.

Prices during March have risen in Scotland, Wales and all English regions except for Greater London, where oversupply has thwarted the expected seasonal uptick. Indeed, oversupply is a growing prob­lem as ever greater numbers of vendors instruct agents across the UK.

Corresponding record sales stock levels (the highest April figure since 2013) gives much cause for concern given that demand will fall back now that the stamp duty dead­line has passed.

Annualised price growth remains weak overall and the mix-ad­justed national average asking price has yet to regain the high set in 2022. The weakest price growth continues to be evident in the southern regions, where rental yields tend to be lower.

A further dark cloud menacing the market is the impending Renters' Rights Bill which is likely to become law in July and put into effect from October onwards. The various provisions within this legislation look set to reshape the private rented sector (PRS), favouring the rights of tenants over those of landlords.

Understandably, such a fundamental shake-up of the PRS is causing concern and anxiety among landlords, many of whom are considering or actively quit­ting the sector. This negative sentiment is only adding to the numbers of proper­ties being placed on an already bloated market.

UK annualised asking rent growth slipped into the negative this month (-0.7%), driven down by a rise in supply of 22% overall. This is a significant drop in real terms when inflation is factored in. The decline in the national average rent was driven by falls in London, the West Midlands and Yorkshire. Meanwhile, the East Midlands continues to outperform, indicating rental growth of 9.3% year-on-year.

The annualised mix-adjusted average asking price growth (sales) across Eng­land and Wales is now 1.4%; in April 2024, the annualised growth of home prices was 0.8%.

Headlines

• Asking prices rose in every English region (except Greater London), Scotland and Wales during March, making the national average rise by a further 0.5%. Such rises are typical for the time of year, so the slip in London prices attests to the level of oversupply.
• Overall, annualised home price growth across England and Wales remains well below the level of inflation at just 1.4% overall.
• Supply of new sales properties entering the market during March 2025 remains moderate in most areas except for London, the South West and Wales.
• The largest March price hikes are in Scotland, Wales and the East Midlands, posting month-on-month gains of 1.3%, 1.0% and 0.9% respectively.
• Scotland overtakes Yorkshire to become the top regional property market growth leader with an impressive year-on-year gain of 5.0%. Meanwhile, the South East retains its position as the worst regional performer with an abysmal annualised gain of 0.2%.
• Sales market momentum shows a significant increase over April 2024. A burst in activity has sent the property turnover rate higher than any of the previous ten years of April readings, while Typical Time on Market is just one day higher than in April last year despite higher stock levels.
• The unsold sales stock count for England and Wales increased by a massive 27,732 properties during the last month, which is far above seasonal expectations. The current total of 503,176 is relatively very high and is the largest April figure since 2013.
• The annualised national growth in asking rents has slipped into the negative (-0.7%), driven down by a rise in supply (22%). The national growth figure is in the red due to the negative performance of London, the West Midlands and Yorkshire. Meanwhile, the East Midlands continues to show exceptional performance, with rental growth of 9.3%.
• The City of London followed by Lambeth indicate the largest declines in asking rents of all London boroughs, with annualised rental falls of 10.5% and 8.6% respectively. Meanwhile, the best performers are Westminster and the tiny rental markets in the boroughs of Sutton and Bromley, with rents increasing by 13.5%, 6.5% and 6.2% respectively.

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