High demand continuing to impact sales and rent

The number of available properties for sale per member branch has risen by 47% since the depths of winter last year but demand has risen by 79% over the same period. The number of agents reporting average price agreed at or above asking has held steady since July when we saw a minor fall compared to June. This shows that the winds are still blowing in the seller’s favour, if not quite as strong as before. Month-on-month we have also seen a slight increase in new prospective tenants registered and instructions, suggesting the autumn market may have started a little early.

The number of new buyers registering per member branch in August rose slightly over July potentially indicating the start of a pickup for the autumn season. There were 86 new prospective homebuyers registered per member branch in August—a 79% increase since December last year.

There were 11 new instructions on average per member branch in August. New instructions have been fairly steady since December last year. The average number of properties available to buy per member branch was 28 in August. Marginally up since the winter dip but still well below the pre-pandemic average of 40 properties available in August (based on 2015–2019 figures). Nevertheless, 28 properties represent an increase of nine per member branch since December 2021—a rise of 47%.

Last month, Propertymark reported that some buyers were starting to secure homes under the asking price, with 27% of branches now reporting that most sales were completed below the asking price compared to a low of just 15% in March. August figures show no further slide.

The rental market

The number of new tenants registered on average per member branch reached a new peak at 141 in August but the supply of available homes to rent has not risen in the last three months. With a growing mismatch between supply and demand, pressure on rents will rise even further.

An average of 141 new applicants were registered per member branch in August. This number has been creeping up since the winter and now stands 188% higher than in December.

Propertymark members reported having 10.9 properties on average per member branch that were available to rent in August—the same figure as the last two months. 10.9 properties is 98 per cent above the December figure of 5.5.

Rents continue to rise

77% of Propertymark member agents reported month-on-month rent prices increasing in August. With a growing mismatch between supply and demand, pressure on rents is likely to become even more acute.

Nathan Emerson CEO Propertymark, comments: "The number of people wanting to buy is still good, and the number of properties available to buy is recovering from the mad dash we had before. Buyers and sellers alike are aware of cost-of-living increases and interest rate rises, there are those of a generation who will remember much higher rates but there is a new wave of buyers who won’t have seen these levels before that will become more cautious with their budget. What we have today, however, is the ability to be flexible on location due to remote working which has a large impact on price. This new dynamic will help home movers and is a factor that hasn’t previously existed.

"In the rental market, we see a pressure cooker getting hotter. The government seem to be missing every opportunity to re-evaluate costs for landlords, whilst this isn’t the most sentimentally attractive conversation for politicians it must be understood that if investment doesn’t work for landlords, ultimately tenants are severely impacted by a lack of choice and high rent prices."

 

Source. 

https://www.propertyreporter.co.uk/property/high-demand-continuing-to-impact-sales-and-rent.html