While once the up-market supermarket would boost local property sales, its magnetism seems to be fading. What’s motivating buyers and sellers in the UK housing sector right now?
In recent years, links have often been drawn between the popularity of certain areas and the supermarkets within them. In particular, a number of analyses have noted a “Waitrose effect”, where the proximity of the well-to-do supermarket would boost house prices and sales volumes in a location.
However, a new Property & Homemover Report from TwentyCi for Q3 2021 has noticed a tailing off of this trend. In fact, it highlights that homes further away from Waitrose stores are actually selling faster right now. Furthermore, properties that are furthest from a Waitrose have seen higher sold price growth between Q1 2019 and Q1 2021.
Yet there is still a distinct correlation between high house prices and a Waitrose nearby. The report shows that average sold prices in Q1 2021 for homes within 0-0.5 miles of the shop were around £599,000. As you move further away, prices deteriorate. For those located 10-20 miles from the store, average sold prices were just £243,000.
UK housing: Amenities versus space
The results of the report show how people are being increasingly pulled between varying factors when it comes to their property. Being close to amenities, particularly an up-market supermarket, still attracts the most affluent buyers who can afford it. But obtaining a property that might have more space at a more affordable price tag, for example, could now be winning out for more buyers.
TwentyCi notes that in the period between Q1 2019 and Q1 2021, houses within 0.5 miles of the shop saw 15.8% price growth over the two-year period. While this is still impressively high, homes further away – particularly in the two to five-mile distance bracket – saw price growth of 22.6%.
“This adds to the picture we have been seeing over the last few months that suggests that whilst proximity to a Waitrose store is attractive, the bigger move is away from busy town centres and cities and towards quieter green spaces,” says the report.
Part of the explanation, says the report, could be down to available stock. The data shows that there was a lower percentage of sales agreed in locations very close to a Waitrose, while those within a 10 to 20-mile radius saw more activity. Logically, cheaper properties are likely to appeal to a wider range of buyers who can afford them, which could explain why these homes are seeing their values boosted due to higher demand.
Demand driven by lack of supply
The UK housing market continues to see a dearth of available homes for sale. There were 9% less new instructions in the third quarter of this year compared to the third quarter of 2019. This is alongside a 16.5% increase in sales agreed, showing how demand for UK housing is consistently outstripping supply.
Across the various regions of England and Wales – excluding Inner London – there are between 1.7 and 2.5 months worth of property stock left to be sold, says the report. This is down by about 50% on historical norms. As appetite remains high, the sector is hugely competitive among buyers right now, buoying house price growth.
The analysis also looks at the volume of “home movers” across the country. This ranges from those who want to move, to those who are already settling into their new homes. At the moment, the number of home movers within this space is up by 14% compared to Q3 2019.
There are currently around 361,061 households who want to move within the UK housing market. A further 335,721 are moving soon, while a similar figure (333,586) are in the process of changing homes. In the “just moved” category, there are 330,936 households, while the smallest number – 296,184 households – are settling in.
