The stamp duty deadline rush has given early impetus to the bottom of the market and had the knock-on effect of energising higher up the property ladder, according to Rightmove’s latest index.
The average price of property coming to market in April was up by 1.3 per cent - £3,843 - to a record high of £307,033.
This increase was driven by second-stepper and ‘top of the ladder’ sectors, while smaller properties in the first-time buyer and buy-to-let sector saw a monthly price drop of 1.4 per cent.
Miles Shipside, Rightmove’s director and housing market analyst, said the sector of the market with two bedrooms or less has in recent years seen high demand from both first-time buyers and buy-to-let investors, creating upwards price pressure.
He said: “The demand boost from those looking to complete before 1 April has now dissipated, resulting in a drop in the average price of a property coming to market in this typical first-time buyer sector.
“However, the momentum it created looks to have enabled owner-occupiers of these properties to trade up. This has built an onward chain reaction of higher demand in higher price brackets as more people can move.”
Upwards price pressure has moved into the typical ‘second-stepper’ sector - three or four bedrooms excluding four bedroom detached properties - with prices up by 0.6 per cent.
The ‘top of the ladder’ sector - four bedroom detached and five bedrooms or more- has seen the biggest increase, up by 1.9 per cent in April.
Mr Shipside observed that while some felt that there would be a stampede of existing landlords selling to other landlords, the figures indicate many of those who sold during the buy-to-let rush were actually first-time sellers looking to trade up.
“They used the heightened demand from investors competing fiercely with first-time buyers to springboard themselves onto the next rung of the housing ladder,” he added.
Jeremy Duncombe, director at Legal & General Mortgage Club, said the buy-to-let rush causing a chain reaction has pushed the dream of owning a home further away from the grasp of many.
“The relentless increase raises the issue of affordability in this country, particularly in the south of the UK,” he stated.