With property listings finally on the up – and significantly so – could this be the start of the end of the country’s housing supply issues?
The latest figures reveal a much-needed rise in the number of new properties coming to the market in the UK. Although buyer appetite remains strong, this could ease some of the pressure and slightly quell the buying frenzy seen in recent months.
Propertymark’s February Housing Market Report reveals that the average number of properties listed per member agent branch rose by 21% compared with January. This brings total properties for sale at each member branch to an average of 23.
The number of sales agreed per branch in the month of February was up only slightly, according to the report, from seven in January to eight in February. Still, this is the highest number of monthly sales since October 2021, after a slight Christmas lull.
UK housing supply versus demand
The number of homes registered per agency branch for sale has been slowly declining since July last year, so the news is certainly positive for the sector. It shows that sellers are more confident and more keen to get the ball rolling as we head into 2022.
However, by comparison, number of house hunters registered at each estate agency branch across the UK throws a stark light on the housing supply/demand situation. In February, Propertymark’s data showed there were 590 prospective buyers per branch.
This figure has been rising, with some peaks and troughs, since last year. It means that, for every available property for sale, there are 26 potential buyers.
What about prices?
The data shows that, unsurprisingly, many homes continue to sell for higher than asking price. February’s figures reveal that 39% of all properties sold for above the original asking price.
This was a 2% increase since January, and the highest figure recorded since June last year when the market was particularly hot. Meanwhile, 41% of properties sold for bang-on asking price, and only 20% of buyers bagged a bargain with a below-asking price offer.
First-time buyers are also doing well at the moment, it seems, as 37% of all sales were made to new property owners.
Nathan Emerson, chief executive, Propertymark says: “It’s very positive to see more properties entering the market. The number of new buyers wanting to register is starting to ease, but agents’ books are still bursting with those still waiting in the wings who have missed out on previous properties.
“The amount of properties going for over the asking price is still a figure that’s over three times more than what we would see in a pre-pandemic market, but with the cost of living, energy and interest rates all looking to increase it’s possible we will start to see buyers being more cautious with their cash.”
Empty homes solution
Among the myriad ways of solving the UK’s housing supply issues, Propertymark has recently flagged up the country’s empty homes as a starting point.
Earlier this month, the industry body wrote to Michael Gove, the Secretary of State for Levelling Up, Housing and Communities. It demanded that the government step up its plans to alleviate the housing crisis, which is affecting the private rented sector as well as buyers.
While the government distributed £100m through its Empty Homes Programme previously, this closed in 2015. As well as reigniting a programme to bring properties back to life, Propertymark has called for incentives such as scrapping VAT on energy efficiency improvements.
It also suggests either discounting or exempting buyers from paying council tax and stamp duty in a bid to encourage them to purchase and use empty properties. All of which could set us on the path to vastly increasing housing supply.
