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Property prices set new record

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High demand for houses has caused property prices to reach a new high, according to the latest Rightmove index.

The property firm said the average new house was listed for sale at £294,834, 6.4% higher than a year ago.

Low mortgage rates, high borrower demand and weak supply were all responsible for this rise, which was the biggest September increase since 2002.

Properties are now worth £2,550 more than a year ago.

The report found that different types of property were faring differently in the current market. Family homes had seen prices rise compared to August while the average first-time buyer home dropped in value by 1.1%.

Month-on-month the typical property rose in value by 0.9%. The highest priced counties continued to rise much faster than elsewhere, all based in the south of England.

In the north, borrowers are still struggling with the ability to raise a deposit and poor supply of new homes.

New seller numbers are down in both north (-4.9%) and the south (-7.1%) compared to last month.

Miles Shipside, Rightmove director and housing market analyst, said that the market was still battling against rising house prices.

“Prices are at an all-time high, yet borrowing is historically cheap and positive sentiment is aided by the ongoing postponement of rate rises from these six-year lows.

“Demand from those who can afford to buy remains high, and suitable supply remains tight, with the number of properties coming to market down 6% on the same period in 2014. The result is the biggest monthly price rise seen at this time of year for 13 years. High demand, lack of suitable supply, and increasingly stretched affordability are leading to some extremes in market forces in different sectors and parts of the country.”

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