Demand from buyers is on the rise, while supply has hit an all-time low. This is causing average asking prices for UK housing to increase.
Sales agreed year-on-year is up by more than 30% across the whole of the UK, according to a new report from consultant TwentyCi. Exchanges have also increased by 55%. With the current housing boom, the strong demand is significantly outstripping supply.
The number of properties for sale in the UK housing market has reached an all-time low. Estate agency residential listings have decreased by 50% compared to usual levels. This leaves an average of only two months’ worth of sock on the books of estate agents. There are even 530 districts with UK housing stock levels below two months.
Colin Bradshaw, chief customer officer for TwentyCi, says: “The lack of properties coming to the market has the potential to jeopardise or temporarily cause a slow-down in the market. Keeping the levels of residential stock to purchase sufficient to satisfy the continued surge in buyer demand, on the back of government stimuli and pandemic induced work and lifestyle changes, is critical to help maintain the economic recovery.”
The number of homemovers continues to increase
Twenty Ci’s “Homemover Wave”, which applies to both renters and buyers, reveals 387,673 households say they want to move. This is a 2% increase on Q4 2020 and a whopping 30% rise since Q4 2019.
The number of homemovers in the moving journey has also increased substantially. This is up by more than 50% year-on-year with an additional 500,000 households entering, progressing or completing the process of moving.
Homemovers are an important part of the economy, contributing an estimated £12bn every year. This consumer group will continue to help the UK’s economic recovery from the COVID-19 pandemic, delivering more than 3% GDP each year.
Colin Bradshaw comments: “The nationwide uplift in the number of people buying and selling has delivered a significant tonic not only to the residential property sector but also to a number of sectors and categories that directly & indirectly benefit from a house move from furniture retailers to DIY stores particularly where they have been able to trade on line whilst stores have been closed”.
Average asking prices rising across the board
With the booming market, average asking prices have been on the rise. Across the UK, prices increased by £13,000 over the past 12 months. This is an increase of 4% to an average house price of £366,000. Interestingly, every region in the UK has seen an increase in prices in the past year.
Yorkshire and the Humber leads the way with a 21% rise in asking house prices. On the other end of the spectrum, Inner London has seen the lowest increase with under 1%. The north of England has continued to be home to stronger house price rises than the south, but most areas in the north are still much more affordable.
Buyers and investors in the north are better placed to take advantage of the tapering period of the stamp duty holiday. With more affordable UK housing prices, there is a large portion of properties on the market for less than £250,000 in these regions. The nil-rate band is in place for properties worth up to £250,000 from 1st July to 30th September. This will likely continue to boost demand in these areas.