There has been talk about a lack of properties for sale for some time now but a new report released at the end of May has put a figure on the squeeze. Propertymark claims that in April 2022, there were 52% fewer properties available, compared to the same month in the previous nine years.
In contrast, the number of hopeful buyers has not waned. Propertymark reports that an average of 100 buyers are registered per branch. The demand has led to more purchasers pushing the boat out, with 39% of agents claiming the majority of their properties sold above asking price.
House prices rise again in May
The habit of offering over the asking price is having a knock-on effect. May saw house prices rise for their tenth month in a row, as evidenced in the Nationwide’s latest house price index. During the last four weeks, property values climbed 0.9%, putting the annual price growth at 11.2%.
Price growth goes against the grain
The 0.9% uplift surprised many experts who believed the rate of house price growth was slowing, especially given the 0.3% increase recorded in April – the smallest monthly rise since September 2021. Annual house prices rises have slowed, however, as April’s 12.1% figure has not been upheld.
Elsewhere, Zoopla announced the UK’s average property price has surpassed £250,000 for the first time. The portal’s latest house price index shows the new average is £250,200. Demand that is +61% above the five-year average and a -37% supply of homes for sale are cited as reasons for rising values.
There were also increasing values in May’s rental market, as noted in Goodlord’s latest rental index. The average English rent is now £1,020 per month – up 0.83% in May. Overall, the cost to rent in England has risen by 11% year-on-year. Goodlord also reported that the average void period in May stayed the same as April, remaining at 19 days.
The effects of a buoyant rental market have been measured in the latest English Private Landlord Survey. This is a national poll of landlords and letting agents who own and/or manage privately rented properties in England.
It found only 10% of those questioned wanted to sell their buy-to-let when the current tenancy agreement comes to an end. In addition, 11% said they were planning to increase the number of buy-to-lets they owned.
Help to Buy ending early
Renters hoping to buy their first property and those moving out of the family home should note the Government’s unexpected change to its Help to Buy scheme. Those wishing to use the initiative need to reserve a property by 6pm on 31st October 2022. This is two months earlier than previously advertised.
Help to Buy offers an equity loan to purchasers, enabling them to buy a new-build property with a 5% deposit. All purchases using the scheme need to be legally exchanged by March 2023 to qualify. Buyers after this date can still explore shared ownership, First Homes and the mortgage guarantee scheme.
Buyers blamed for fallthroughs
Movers may like to know the findings of new research into fall through rates – that’s when a transaction doesn’t complete successfully. A survey of more than 940 agents sought to pinpoint the problem. Of those questioned, 46% stated fallthroughs were due to issues on the buyer’s side, with 22% also citing buyers further up or down the chain as the problem.
The good news is fallthrough rates are low thanks to strong buyer demand. In fact, 70% of agents said they had seen fewer than 9% of their sales fail to complete. As well as issues with buyers, 17% of agents found that conveyancers and solicitors were to blame for fallthroughs.
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