Property prices and demand up

Michael Lloyd

January 15, 2018

The average price of properties coming to market has risen by £2,067 (0.7%) this month on Rightmove, which tracks over 90% of the UK property market.

This is similar to the 0.6% rise at this time a year ago with virtually identical number of properties coming to market.

Demand evidenced by visits to Rightmove shows the market remains robust. The average number of visit so far in January is currently running over 9% higher than the same period a year ago, with an average of over four million visits each day.

Miles Shipside, Rightmove director and housing market analyst, said: “Considering some of the gales that buffeted the market in the latter part of 2017, these early readings for 2018 show that there is currently a good following wind of search activity.

“To keep this year’s initial buyer momentum with you rather than against, serious sellers should note that all regions are currently selling at a slower rate than a year ago, indicating choosier buyers.

However the number of sales agreed in the last quarter of 2017 is lower than a year ago in all regions, showing buyers are being choosy.

Shipside added: “The total number of sales agreed was 5.5% down in the last quarter of 2017 compared with the same period in 2016.

“Setting tempting asking prices and then quickly reducing them, if there is little initial interest, will be key to turning this promising level of buyer activity into actual sales, especially in the less active sectors and locations of the UK.”

The annual rate of price increase in newly-marketed property is 1.1%, but at more local level prices are running 4-6% up in some regions, with only London recording a year-on-year fall at -3.5%.

Stretched buyer affordability and an uncertain political outlook are counter-balanced to a degree by tight supply of suitable properties for sale and the recent near-abolition of stamp duty for first-time buyers.

There is no increase in choice for buyers, with average overall stock per estate agency branch holding steady at 42 properties, the same as a year ago.

The boost given to first-time buyers by the abolition of stamp duty for most of their purchases means that properties in that sector are facing higher demand. This consequently leads to more upwards price pressure, especially if supply is limited.

Talking about the impact of the stamp duty changes, Chris Chapman, divisional managing director of Estate Agency at Andrews, said: “Whilst it hasn’t, in our experience, resulted in a huge spike of first-time buyers entering the market, it has certainly created increased interest from purchasers who had previously felt unable to take the first step on to the property ladder.”

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