Despite a better-than-expected Q1, recent rises in the Bank of England base rate has hindered the number of sales being agreed in Q2. Compared to the more normal market of 2019, buyer demand is 3% higher and the supply of property is 12% lower. Properties that are priced to reflect the current market conditions are still seeing good levels of interest, together with some of those more unusual rural properties still attracting best and final bids.
Choosing an estate agent who price realistically and have a well-trained team is vital to navigate the current market. A good proportion of sellers are being advised on, or have expectations based on previous market conditions. Where this is the case, according to Rightmove those properties are 10% less likely to sell compared to those priced correctly at the outset. With less experienced agents focussing on winning business rather than the right advice, this brings about an imbalance of pricing within the market. Ask yourself how many of those properties you’ve seen come to the market have actually sold?
With properties taking an average of 55 days to sell, buyers now have the time to make informed decisions and take their time, making sure the next move is the right move.
Changes within the mortgage market have also influenced transaction levels with the Bank of England making their 13th consecutive increase to the base rate since December 2021. With the average rate for a fixed two-year deal being 6.81% and a five year fixed deal being 6.34%, current mortgage rates have reached their highest level since August 2008.
Whilst mortgage rates are high, the rental market is seeing increased demand in places, particularly in the mid to lower end market. Whilst demand levels are high, new landlord instructions have fallen to the lowest levels since May 2020. This has led to rental prices rising by 5.1% year on year to June 2023. With a continued imbalance of supply and demand, rental levels are expected to continue to rise in the short term.
All in all, properties are still moving but getting the right advice is critical, be that from a trusted estate agent, mortgage advisor, solicitor, accountant or building surveyor having the right team working for you makes all the difference.