Sellers have pushed up asking prices by 3.2% over the last month, the highest monthly rise in asking prices since April 2007.
Rightmove’s House Price Index for February shows that average asking prices increased by over £7,000 over the last month, going from £222,261 in January to £229,398 in February.
Miles Shipside, commercial director at Rightmove, says the rise is unexpected given the difficult outlook for the UK economy.
A lack of stock in popular areas has helped push asking prices higher.
This is particularly true in London where asking prices have leapt by over £20,000 to reach a record high of £427,987.
Shipside says: “Sellers are setting their sights higher, and some agents are going along with them in order to win scarce instructions.”
Average national asking prices are now £13,300 higher than a year ago, and Shipside says that this latest jump in monthly asking prices is unsustainable.
He adds: “For individual sellers it’s hard to grasp the bigger picture and they rightly hope they will find a buyer who can get the required share of the rationed finance that is available.
“This works after a fashion while the number of sellers remains limited.
“However if sellers return to the market in larger numbers the current upwards price pressure will not be sustainable with the restricted number of buyers.”