The UK housing market is experiencing a resurgence as asking prices for homes surged in May, marking the highest monthly increase of the year, according to property

website Rightmove. Despite recent interest rate rises by the Bank of England, the better economic outlook and stable mortgage rates have outweighed the impact on the market.

Rightmove reported that the average price of homes coming to the market rose by 1.8%, equivalent to £6,647 ($8,389.18), compared to April. This increase surpassed the average rise for May, which stood at 1.0%.

Tim Bannister, Director of Property Science at Rightmove, suggested that increased confidence in the market could be attributed to the diminishing likelihood of the gloomy predictions that were initially made for the housing market at the beginning of the year.

Earlier forecasts by sector analysts predicted a potential decline of up to 15% in British house prices by mid-2024. However, the UK economy has displayed greater resilience than expected, avoiding recessionary predictions thus far.

While borrowing costs have eased from their peak after the September "mini-budget" presented by former Prime Minister Liz Truss, they still remain higher than pre-financial market turmoil levels in the autumn.

Rightmove noted that mortgage rates have remained stable on a week-to-week basis. In response to the rising inflation, the Bank of England recently raised Bank Rate by a quarter-point to 4.5% to help address the situation.

Despite varying indicators, Rightmove highlighted that buyer demand in May was 3% higher compared to the same month in 2019, before the market was affected by the COVID-19 pandemic.

Different reports have presented a mixed picture of the housing market. Mortgage lender Halifax indicated that property prices grew at the slowest annual pace in over 10 years in April. In contrast, rival Nationwide reported a monthly increase of 0.5% in April, following seven consecutive months of decline.

According to the Resolution Foundation, a think tank, approximately 1.6 million British households are expected to face an average increase of £2,300 in their fixed-rate mortgage bill as their deals mature over this year and the next.