February market update
The Times published a pretty scary front page over the weekend and whilst many sellers will argue with the sentiment there is some evidence to substantiate their concerns. An industry update from estate agents last month suggested that the average office had 41 homes for sale but sold just 6. Not impressive when you consider that they were reported to have 390 buyers registered. The latest numbers from Rightmove published this week confirms this data and suggests that there doesn’t seem to be the shortage of homes for sale that some blame on the current market woes although what is selling does seem to be taking longer.
Last week the Office for National Statistics gave us the latest details on properties that actually sold.
Whilst prices are holding up transaction volumes are down. Sales agreed after the Referendum last June will have completed in October and according to the official data they were down across England by 35%, in Wales by 26% and in Scotland by 15%. In London transactions were a whopping 45% lower than in October 2015, itself a slow month following the General Election the preceding May.
I think new-build prices have been propped up by the controversial Help to Buy and the data seems to support this. It’s quite fair that a developer should be paid a profit for building it but buyers should be aware that this may be as much as 20% more than the comparable second-hand home.
So, 2017 is looking fragile to say the least. There are over 12,000 £1m+ homes for sale across London according to Rightmove but last month just 365 sold. Whilst the Times headline may seem alarmist the sentiment is spot on – at last I think so.