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Average house at record high price of £209,829

House prices are at a record high, according to Rightmove's latest report. Figures show that property shortages are pushing up prices, with demand outweighing affordability constraints.

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	May	April
Average property asking price	£209,829	£205,674 %
Change in month	+2.0%	+1.1% %
Change in past year	+5.9%	+4.1%
Monthly index (Jan 2002=100)	170.7	167.3

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In spite of an industry consensus of a levelling off of demand in the second half of the year, Rightmove is increasing its 2006 forecast from 5% to 8%. This would give an average national asking price of £212,025, representing a rise of £15,706 on the year.

Miles Shipside, commercial director of Rightmove, said, "The housing market is set to defy the downward pressure from increasingly stretched affordability with double the rise that was forecast by the industry just 5 months ago"

Rightmove's report said average asking prices of nearly 126,000 properties marketed in the last month increased by £4,155 (2%) to a new record of £209,829. That represents an annual rate of increase of 5.9%, jumping up from 4.1% last month. As there were falls in prices of 0.8% in the latter months of last year, it only requires a 1.3% rise over the remaining 7 months of 2006 to hit an annual rate of 8%.

Miles Shipside added "Demand is a lot more buoyant overall than at this time last year, so a rise of up to 10% in the faster moving regions, such as parts of London and the South, could be on the cards this year. It can't keep rising like this but will flatten out rather than fall back substantially, as there are few 'distress sales' from vendors who are forced to sell at any price".

The timing of Easter in close proximity to the May Day bank holiday exacerbated the shortage of supply of new property coming onto the market this year, the report says. Home-hunters, who constitute a large proportion of future sellers, failed to view property that might have tempted them onto the market. This pause in activity led to the stabilisation of the average stocks per estate agency branch at 65.

Meanwhile, time on the market is falling - dropping from 75 days to 70 days in the last month:

"Agents are reporting more sales on new listings, as opposed to their older stock," said Miles Shipside, adding that if a property is not selling, a price-drop or makeover is a good idea before the market quietens over the summer holidays.