House asking prices rise by 3.5%

House sellers hiked their asking prices by more than £8,000 in October in the biggest jump seen in eight months, Rightmove has said.

The typical property asking price rose by 3.5% month-on-month to £243,168, as all regions across England and Wales saw prices increase.

The property search website said the autumn rebound showed "evidence of some life in the market", although it suggested the upturn is most likely to be due to a lack of properties for sale, meaning would-be buyers have less choice.

The jump means prices are 1.5% higher than a year ago and goes some way to reversing an £11,000 drop in prices between June and September, when the market saw a lull amid distractions like the Olympics.

London, which has had strong overseas buyer interest and continues to perform relatively strongly, saw the biggest monthly increase in asking prices, with a 4.8% jump taking average prices to £478,071. The South East and the West Midlands both saw 3.9% increases, while prices rose by 3.8% in the North West and by 3.4% in Wales, while East Anglia saw the smallest increase, with a 0.4% rise.

The Council of Mortgage Lenders (CML) said last week that mortgage lending to home buyers hit a two-year high in August, although it cautioned that it is too early to say what long-term effect recently-launched Government schemes to kickstart lending are having.

Mortgage availability has been increasing since an £80 billion funding for lending scheme was launched at the start of August, although much of this has so far been concentrated around people with larger deposits of at least 20%. Lenders have also toughened their borrowing criteria in recent months and Rightmove said estate agents are still reporting that mortgages are no easier to obtain, with lenders "nit-picking" through every detail of applications.

Miles Shipside, director of Rightmove, said increase in asking prices "is most likely attributable to the continued shortage of new property supply".

But he cautioned: "Sellers need to be mindful that the window of opportunity to sell before the traditional winter slowdown is a narrow one, and they risk being left out in the cold for months until the spring market thaw.

Rightmove said that its own research has found that fewer than two in five would-be buyers say they will arrange to visit a property they believe is over-priced, even if it matches their criteria.