House price growth continues and there are more buyers than properties, so the market remains very competitive, with multiple buyers competing over one property.
Property website Zoopla states that the annual rate of UK house price growth is currently at 6.9 per cent – up from 3.5 per cent in the same month last year. One in 16 homes is set to change hands by the end of this year. The market will be at its busiest since 2007.
According to Zoopla, homes in the South East and the South West have recorded growth of more than £22,000 in the past 12 months.
UK house prices hit a record high according to Halifax, as the average UK house price rose to £270,027 according to the lender. ‘There are fewer transactions happening which is helping to fuel the increase in prices,’ says MB Associates’ Sales Manager Phil Leivesley. ‘While there is still plenty of demand from buyers this isn’t being met with an appropriate supply of properties and this seems to be distorting the market a little. The increases we have seen over the last 18 months are unlikely to be sustainable for the long-term.’
Fewer residential sales
The number of residential sales fell by more than half at the end of the stamp duty holiday. HMRC says that annual transactions fell by 28.2 per cent between October 2020 and October 2021. In fact, sale transactions in the UK fell by 52 per cent in a month during October.
The stamp duty holiday ending on 30 September has eased the pace of the market, as there’s no urgency to meet the deadline and make a saving.
The pace of the market has also been affected by the afore-mentioned shortage of properties. According to the website Yahoo! Finance, buyer demand is running at 28 per cent above the five-year average. Homes listed for sale this year have been running at between five and ten per cent below the 2017 to 2019 average.
The race for space
More people are seeking bigger properties so that they can work from home, while others are keen to find a house with a garden after feeling restricted during the lockdowns. More space is important to many. Some people have also moved out of busy cities and into more rural areas. London continues to be the region with the lowest annual growth.
If you find your dream home, it’s worth reacting swiftly and putting in an offer as soon as you can. Competition among buyers is fierce so it would be worth having a mortgage offer agreed in principle so that you can send it to an estate agent when making an offer and demonstrate that you’re a reliable buyer.