Sales of £1m+ homes down 50% from the peak

The latest report from HM Land Registry piles yet more statistics onto our collective knowledge of the housing market in England & Wales. In their recent report Lloyds Bank noted the sharp rise in the sales of million pound properties across the UK (54% higher last year than in 2009) and the bank claimed that sales of homes at the top of the housing ladder were rising at their fastest rate since 2006. In fact the number of expensive homes selling across the country (486 in January) is almost exactly the average number (473) each month over the past six years.

Looking at the Land Registry data several things come into sharp focus;-

• The total number of homes sold in January was 70% below the peak of 124,517 sold in August 2007.
• The number of £1m homes sold in January was ‘just’ 50% lower than the 967 sold in July that year and in London only 42% fewer.
• 66% of million pound plus homes that sell across the country are in London against a long-term average of 58%.
• At £336,828 the average price of a property in London is only 4.5% below the peak of £352,860 recorded by Land Registry in January 2008.
• Roughly the same number of homes sold in January across the country as did in January last year. 
• The total value of property sold was 74% lower than the total sold in August 2007

Looking at a graph of the sales of homes over £1m across England & Wales it is clear how tough life has been even for those operating at the top of the market. 486 sales were recorded in January compared to just 184 in January 2009. 

Typically around 0.7% of homes that sell each month across the country are in six figures. The latest share is nearly twice that at 1.33%. London typically forms 3.28% but made up 5.8% in January. 

Assuming average selling fees of 1.4% then the total earned by estate agents last month was £82m. Imagine how much more fun it was to be selling houses in August 2007 when this total was over £318m! 

These Land Registry numbers are of course lagging the real market but the trends and rolling averages provide a helpful and reliable insight. More worryingly, whilst they are not exactly like-for-like, average asking prices have continued to rise for the forth successive month according to while sale prices have fallen for seven consecutive months as far as Land Registry is concerned and by 3.4% over the past year according to the Halifax.

Almost to a man the market expects prices to continue to fall through the next three quarters of 2011. Of much greater concern to everyone connected to property are volumes which may have bottomed out but which are still too low to afford everyone at the table enough to subsist upon.