If more more people want to buy properties than sell them prices will rise and vice versa. It's therefore important to keep tabs on the supply and demand situation in the market.
Download my full property price summary for April 2015
Kate's comments on demand this month
“Election or not, people still have to move and there is definitely more optimism around by buyers - particularly those who may have missed out on properties during busier times last year. They tend to know what they want and to wait until it’s available, knowing what is a ‘fair’ or ‘good’ offer to make. The Mortgage Market Review effect seems to have settled down for first time buyers and it’s great to see a third of the market going to them. It does though seem to have held back demand in London where the 4.5x salary limit is hitting the hardest. Overall, demand seems to have remained sturdy despite the election uncertainty.”
What are the indices saying about demand for property
Rightmove “There is still high demand for the right property at the right price with agents reporting that quality stock is selling well despite some election jitters. Rightmove recording nearly 59 million page views in one day suggests that home-movers have a confident outlook, while remaining choosy about what they will buy. Stunningly attractive long fixed-term mortgage rates are obviously another great boost to positive sentiment. (Mar 15)”
NAEA “This month, NAEA members reported that the number of house hunters recorded per branch was 366, four per cent higher than January, when the number of house-hunters registered at each branch was at a ten-month low. The number of house-hunters could be attributed to the fact that there is uncertainty around the General Election; those looking to buy are unsure of what policies may come into play and how these may affect their sale and so want to push through sales ahead of May.
“The number of sales agreed in February remained level from January, with agents reporting an average of eight sales agreed per branch.
“The percentage of sales made to first time buyers (FTBs) is up in February, with the group now accounting for 30% of all sales made in member branches, up from 26% in January. This is the highest amount since September 2014, and sales to FTBs have not reached higher than this level since records began in 2009. (Feb 15)”
RICS “The RICS new buyer enquiries series shows demand stabilising at the headline level after seven consecutive negative net balance readings. The divergence across the country is becoming less pronounced with most parts now seeing some rise in enquiries. (Feb 15)”
Agency Express “All 12 regions recorded by the Property Activity Index reported increases in properties ‘sold’. Those recording the largest increases in properties ‘sold’ included: Yorkshire & Humber +25.1%; South West +19.9%; West Midlands +17.6%; South East +16.9% and Central England +16.4%. (Mar 15)”
Bank of England “The number of loan approvals for house purchase was 61,760 in February, compared to the average of 60,750 over the previous six months. (Feb 15)”
Severn Trent “The average number of daily transactions in February were down 8.1%, year on year. They were however, up 20% on average daily transaction volumes in January. Although 8.1% is significant it represents a lower downturn than December and January’s year on year declines. (Feb 15)”
Land Registry “In the months September 2014 to December 2014, sales volumes averaged 75,553 transactions per month. This is a decrease from the same period a year earlier, when sales volumes averaged 77,174 per month. (Feb 15)”
Kate's my comments on supply this month
“Most areas seem to be doing OK for supply coming onto the market, according to those that track the later data (March), while for those looking at January/February data the stock levels were still restricted. The main hope for increased stock moving forward has to be more first time buyers moving from the PRS to the home ownership market, and more new builds will help to generate the long term additional stock we need to house the nation.”
What are the indices saying about supply of property
Rightmove “The number of newly-listed properties is up by 3.2% compared to last month, though first-time buyer properties which are likely ‘granlord’ investor targets, have seen the lowest increase in supply (+2.6%) and are the sector seeing the highest annual price rise (+7.6%). (Mar 15)”
Home.co.uk “The supply of property for sale nationwide is rising but only moderately overall and from a low base: 9% more properties were placed on the market this February than in February 2014. We expect this trend to continue, led by Greater London (up +31% YoY). The total stock of property for sale is currently just 3.7% higher than it was in March 2014. (Mar 15)”
NAEA “Member agents have reported that the number of properties available for sale at each branch is down in February, from 44 in January. This is the same level as February last year, and the lowest supply since March 2014, when 42 houses were available per member branch. (Feb 15)”
RICS “On the supply side of the market, conditions tightened once again with a net balance of 8% of respondents seeing fewer new instructions to sell (when measured on a seasonally adjusted basis). New instructions fell in most areas with anecdotal evidence suggesting that political uncertainty may be adding to the supply constraints by causing some vendors to hold off putting their properties on the market. The combination of subdued demand and a lack of property coming to market has kept sales activity muted recently. The net balance of agreed sales recorded a value of +1 following the slight increase in January. (Feb 15)”
Agency Express “The regions showing the largest increases in listings ‘for sale’ recorded by the Property Activity Index, include the West Midlands +17.4%; South East +16.1%; Yorkshire & Humber +16%; East Midlands +13.3% and Wales +12.5%. (Mar 15)”
Download my full property price summary for April 2015
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