Coming to the end of the month we see no signs of the markets slowing down. Average asking prices have increased yet again, this time by 1.8% increase on what was an all-time high only last month.
Prospective buyers are now faced with record prices for new houses coming to the market in all regions of the country except London. On a year-on-year comparison of May 2020 vs May 2021 we see Wales as the fastest-growing region by a massive 13% followed by the North West at 11.1% and even in the south of England the prices has increased by a huge 9.7% year on year.
The market also seems to have enough momentum to shrug off the impending end of the stamp duty holiday in England and Wales where buyer demand has soared by 52% in some places.
Sales completion forecast is set to rise to around 1.5 million. Buyer demand has been string since the end of the first lockdown last year as households reassess how and where they are living especially if there is now a need to work from home. Many older households are also re-evaluating their household needs and moving for the first time in many years. First time buyers remain very active in the market, with better access to mortgage finance.
The time between listing a property and securing a sale subject to contract has fallen by 10 – 15 days in the North West, Wales and Yorkshire and this is accompanied by the highest levels of price growth.
The graph below shows the significant increase in asking price over the time period since the market was suspended during the first lock down (Rightmove)
Average time to find a buyer has also dropped significantly over the last year from a peak in May 2020 with properties taking 88 days to sell (figures are probably effected by the previous two months of lockdown raising the average) down to nearly half of that last month with an average of just 45 days.
As you are probably aware on 1st July 2021 the Stamp Duty holiday for properties up to £500,000 will no longer apply. However any transactions that are completing between that date and 30th September 2021 will not incur stamp duty on the first £250,000 of the purchase price.
Any transactions that are set to complete before the deadlines area clearly going to benefit from the transaction, however if you are just agreeing a sale now or are on the market now you must take action to not only attract a buyer immediately but also put steps in place to make sure that when you find a buyer over the next week or so your solicitor is ready and poised with everything they need.
At Veritas homes we have set up an agreement with our solicitors to ensure that we still have the chance of getting sales through before this deadline, it is an ambitious and complicated goal to achieve this but it can definitely be done.
If you would like to talk to one of the Directors who between them have over 50 years’ experience in the property market then please call us on 0121 794 20 29 and we will be happy to give you advice free of charge.
Record Highs as properties sell at pace
With a monthly price surge of 2.1% (+£6,733), the national average now stands at a whopping £327,797, this figure beats the last record recorded only last October at around +£4000. This big jump comes as buyer demand soars in most areas chasing the lowest amount of properties available on the market in proportion to buyers. According to Rightmove this is now officially the fastest selling market that they Rightmove have ever recorded.
Fun Facts for April 2021
- The average number of days to sell a property are the lowest on record.
- Two and three-bedroom semi-detached homes are the fastest-selling.
- During the month of March over 2 billion minutes were spent looking at property.
- The number of sales agreed is up by 55% compared with the same period around two years ago.
- Demand is up a staggering 27.5% whilst the flow of new supply is down -6.1%
Demand for homes
There has been a strong buyer demand since the start of 2021 leading to one of the busiest sales markets in years. Since March, demand has jumped again to levels like those last seen in the wake of the first lock down last summer.
The combination of children returning to school and the stamp duty holiday extension announcement in early March as well as the return of first time buyers and the continued ‘search for space’ among homeowners came together to create a demand boost, especially for family homes.
Demand peaked in the weeks following Easter hitting levels double those of the same period in 2017 – 2019. After the first major easing of lockdown on the 12th
April in England, demand levels began to fall back as the focus switched from the housing market to catching up with family and friends.
What is happening in the Midlands?
The average price of a property in the West Midlands now stands at £226,948 in April 2021 according to Zoopla. This is a rise of 1.4% since January 2021 and a rise of 9.86% over the last 12 months. In terms of a breakdown of different types of properties, flats in the West Midlands sold for an average of £156,960 and terraced houses for £161,174.
Buyer demand is likely to continue to ease throughout the rest of the year as the restrictions are relaxed even more, however we are still expecting levels to remain above average throughout Q2.
However the supply/demand imbalance will remain. The ‘search for space’ among homeowners has further to run, especially as some office based businesses are now confirming that their work practices will change in the longer term. At the same time the roll out of 95% mortgage guarantee will mean more demand from first time buyers.
UK annual price growth was at 2.1% at the start of the first lockdown, and is now at 4% after peaking at 4.5% in January. Prices will continue to be underpinned by the ongoing supply and demand imbalance with the strongest growth in the Midlands and up North. The scale of the growth is set to slow in the coming months especially as we move towards Q3 where the stamp duty holiday extension comes to an end and the government support for the economy starts to be pared back.