The total fee slice taken by London estate agents each month dropped by over £20 million between 2015 and 2016, the latest house price index reveals.
Today’s figures from the Office of National Statistics (ONS) reveal that the number of completed sales during November 2016 compared to November 2015 fell from 9,800 to 6,400.
This, based on an average fee of 1.5%, saw agents’ total revenue for the two Novembers dip from just over £67 million in 2015 to £47 million last year.
Completed house sales across England also reduced during the same period, down by 21.2% to 62,500 from 79,300.
This reduction in supply is the main driver behind buoyant house price figures, most commentators agree. The figures for completed sales, also released today, show prices rising by 6.2% over the past year.
The average price for a property in London is now £490,700 compared to £234,800 in England and £145,900 in Wales, the index says.
“With only a week to go until Article 50 is triggered, house prices remain indestructible as the average person is paying £13,000 more to own a home than the same time last year, reflecting the health and buoyancy of the UK economy seen in the last few months. This certainly chimes with our own data,” says Paul Smith, CEO of Haart (pictured, left).
“But low supply does have an important role to play in rising prices. If the Government could finally stick to their word and act to substantially boost house building across the UK to meet the needs of families, downsizers and first-time buyers, we could certainly see the UK property market going from strength to strength in the upcoming months.
“While the Government is focused on the EU we must not lose sight of the challenges here at home.”
Jonathan Hopper (picture, right), Managing Director of Garrington Property Finders, strikes a more cautious note.
“While the lack of supply is steadily nudging up average prices, pragmatic vendors are realising that this is anything but a seller’s market. Astute buyers are increasingly able to ask for, and secure, sizeable discounts,” he says.
“Buyer confidence is not unlimited though, and on the front line we’re seeing that house hunters, though committed, are highly price-sensitive.”