The monthly UK house price statistics for August are in – Here are our main takeaways….
Buyer demand remains strong
• Buyer demand has stayed strong during the first week of August, up 56% compared to the same period in 2019, and down just 17% on frenzied post-lockdown 2020.
• Homes are selling at the quickest rate on record, one month faster than before the first lockdown.
• Rightmove reports new record highs in price of property coming to market in the mass-market sectors, made up of first-time buyer properties, up by £1,328 (+0.6%) in the month, and second-stepper properties, up by £975 (+0.3%) in the month.
Demand slowed for the most expensive properties
With buyers no longer making larger stamp duty savings, demand has slowed for most expensive properties. The cooling of the upper-end four-bedroom-plus sector was down by £4,699 (-0.8%) in the month,
The overall result is that the national average falls £1,076 (-0.3%) this month, the first price drop recorded in 2021.
Tim Bannister, Rightmove’s Director of Property Data comments: “New sellers dropping their asking prices can ring economy alarm bells, especially when it’s the first time so far this year, so it’s important to dig underneath the headline figures.
Firstly, we are in the holiday season which means that sellers have traditionally tempted distracted buyers with lower prices, though that might well be less applicable this year with many buyers having to stay a lot closer to home.
Indeed, our analysis shows that average prices have only fallen in the upper-end sector, which is usually more affected by seasonal factors such as the summer holidays and has also seen the greatest withdrawal of stamp duty incentives.
The mass-market of properties that cater for first-time buyers and second-steppers is still seeing high demand and upwards price pressure leading to new record high average prices in those sectors. In England there remains a smaller stamp duty saving of up to £2,500, though the window to take advantage of this saving by buying now and completing by the end of September is pretty much closed.”
Properties selling faster than ever
Demand for properties is at an all time high, with properties selling faster than ever. The current market has a strong incentive for owners to come to the market with a ‘sell before you buy’ tactic. This is absolutely necessary to places buyers in a great position to be able to secure their next home quickly, within this fast-moving market.
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What is going to happen to UK house prices?
If you are planning a property move you will be interested to know what is likely to happen to house prices and whether now is a good time to move. House prices are determined by a number of factors;
The overall health of the economy: Buyer confidence effects how much they are willing to pay for a property. The unemployment rate and wage growth both play a part in consumer confidence.
Interest rates: The Bank of England set the base interest rate level, when low, people can afford to spend more on property as the repayment rates are lower. This has an impact on house prices, pushing prices up.
Supply and demand; Local house prices are affected by the demand within the area, for example properties within a sought-after area will attract a higher price. The pandemic saw a big change in buyer priorities, with work from home opportunities and consumers choosing to improve the home-work life balance with many opting to relocate to the country areas, has seen an increase in demand within our region.
As buyer demand is at an all-time high, available stocks for sale are at a record low, with buyers hoovering up new supply. These circumstances mean properties are selling, and selling more quickly.
Buyer demand remains strong, despite the relative summer pause for the more expensive properties. Rightmove predicts that there will be an autumn bounce in both seller activity and prices.
When should I market my property?
With demand so high home-owners who are thinking of moving need to act soon, to take advantage of the current market and have a better chance of a quick sale at a good price and be in their new home before Christmas.
Rightmove’s analysis shows that the likelihood of sellers finding a buyer remains at, or close to, an all-time high. The average time for a newly listed property to be marked as sold subject to contract is the quickest ever at 36 days, which is a whole month faster than in February 2020, which was the last month before the first lockdown.
Toby Philips, Managing Director for Countrywide, said: “The UK property market continues to defy expectation, with houses continuing to sell faster than ever. Although we’re seeing glimmers of a downturn in house prices as a result of the tapered stamp duty holiday deadline, we’re seeing this predominantly in the premium end of the market. Across our Southern region in particular we’re seeing a continued surge in the volume of new buyers looking to purchase the limited housing stock available. This is creating a fast moving, favourable market for sellers. We can see little sign of this abating and would go as far as predicting an Autumn bounce in prices if buyer demand continues as it is.
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