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Shortage tips house prices 2.8pc higher

AVERAGE asking prices in the UK are now higher than they were a year ago as a shortage of stock pushed up property prices by 2.8 per cent, the biggest October rise in six years, according to recent data from Rightmove.<br /><br />London asking prices also surged by 6.5 per cent to a record high of &pound;416,157, above the previous high of &pound;412,731 that was hit in November 2007 at the peak of the market.<br /><br />The property website said that the lack of new Autumn stock across the whole country means that the balance of power continues to swing towards new sellers, which is unusual for this time of year.<br /><br />Only 95,000 new properties have come on to the market this month in the UK, with only 17,000 in London The current price recovery is based on an unusually thin market with transaction levels still 54 per cent down on 2007.<br /><br />Miles Shipside, commercial director of Rightmove, said: &ldquo;It&rsquo;s a little bit crazy to have a sellers&rsquo; market given the time of year and the warnings of imminent fiscal austerity by all the main political parties.&rdquo;<br /><br />He added: &ldquo;Buyers are ready to pounce on new instructions and are willing to proceed as they believe prices have bottomed, and more are finding the ability to put down the larger deposits required to access the best mortgage deals&rdquo;<br /><br />However, he cautioned that the expiry of the stamp duty exemption for properties between &pound;125,000 and &pound;175,000 could distort the market.