House prices reach record high in April, says Rightmove

House prices rose 1.3% month-on-month or £3,843, to reach an average of £307,033 in April across the two regions.

Prices were driven by first-time sellers looking to upscale to bigger properties.

Miles Shipside, Rightmove director and housing market analyst, said the demand from buy-to-let investors trying to complete purchases ahead of higher taxes on 1 April has dissipated.

The government increased stamp duty by 3% on buy-to-let and second home purchases at the start of this month, which boosted demand in the months leading up to the new rules.

With the mad rush over, asking prices for smaller homes with one or two bedrooms - properties typically sought by buy-to-let investors and first-time buyers – fell 1.4% this month to an average of £182,926.

“However, the momentum it created looks to have enabled owner-occupiers of these properties to trade up,” Shipside said.

“This has built an onward chain reaction of higher demand in higher price brackets as more people can move.”

He said the typical “second-stepper” sector of properties with three or four bedrooms, excluding four-bedroom detached properties, rose 0.6% this month to an average of £257,871. The “top of the ladder” sector, which includes four bedroom detached homes and properties with five bedrooms or more, has seen the biggest rise this month, up by 1.9% to an average of £546,232.

“While some felt that there would be a stampede of existing landlords selling to other landlords, these figures indicate that many of those who sold during the buy-to-let rush were actually first-time sellers looking to trade up,” Shipside said.

“They used the heightened demand from investors competing fiercely with first-time buyers to springboard themselves onto the next rung of the housing ladder.”