According to the Nationwide, the average house price across the UK is up 11% on last year prompted, as we know, by three things:
1) Pent-up demand following three years of Brexit confusion,
2) The SDLT (stamp duty) holiday coupled with ultra-low mortgage rates,
3) Lifestyle changes prompted by the pandemic.
Interestingly, the average percentage increase in the price of houses in England and Wales is nearly four times greater than average increase in the price of flats, as people seek more space to work from home (Source Zoopla).
In terms of the number of completed transactions, this was up 25% on last year, but the stock of available properties is far from being replenished. New-to-market properties are down 5% on what we would expect, leaving the total stock of properties for sale down by about 26% on last year, and 33% down on three years ago. These are staggering figures and have come as a surprise to us as much as to the economists, none of whom predicted this would happen, especially during a pandemic.
So, we have a massive undersupply of homes for sale. This is compounded by the fact that the supply of new-build homes virtually came to a standstill during lockdown. No wonder prices across the board have rocketed over the summer. Fortunately, we have training and systems in place that ensure that our sellers are always able to secure the very highest price the market will pay, whatever the market – so these investments in our people have really paid off!
For the time being buyer demand is unrelenting. The question is, if everyone wants to move, why is there not a corresponding seller for everyone who wants to buy? There are three reasons; first, this year there has seen a 21% increase in demand from investors, taking advantage of the temporary Stamp Duty holiday. Secondly, demand from first time buyers, who now account for about a third of the market, is up 15% on last year. Neither of these sectors have to sell in order to buy. However, we suspect that demand from both these sectors could shrink now the SDLT concession is ending and the effects of furlough on mortgage applications is felt.
The third reason for lack of stock (and this is one that maybe you can influence) is that many people looking to buy have not yet put their own on the market because they fear they might not be able to find anywhere suitable, due to apparent lack of choice. But would you reconsider your position when you know that we would assist your search for the right property. Most people believe that once an agent has sold a property the seller is left to their own devices to find a suitable property but that is not the case with us.
We take a very active position in helping our sellers find a suitable property once we have found a buyer, even if a property is with another agent.
So, we’d urge you to have a little faith, and great things can happen. Why not contact us right away on 01322 228090 even if you are only considering the possibility of moving, and we’ll happily let you have the very best of our advice, as we love helping people move!