Buyers market emerges as supply of homes hits ten-year high
Supply is outpacing demand according to the latest Rightmove report which shows record prices but the lowest May growth since 2016.
The property market is shifting decisively towards buyers as the number of available homes for sale reaches a ten-year high, according to Rightmove’s House Price Index.
Colleen Babcock (pictured), property expert at Rightmove, says that while average asking prices rose 0.6% to a new record of £379,517 this month, the increase is the smallest for May since 2016.
She adds: “The ten-year high choice of homes for sale means that sellers need to be made aware of the level of competition they’re facing for the attention of buyers.”
“This month’s price increase being the lowest in May for nine years, is a sign of a market that favours buyers and is more subdued than usual.”
Increased competition
The data also shows that the number of new properties coming to market is running 14% ahead of this time last year, creating unprecedented levels of competition between sellers.
This surge in supply, combined with a 4% post-Stamp Duty fall in demand, has put buyers in a far stronger negotiating position.
However, sales agreed in April were 5% higher than the same period last year, as the more motivated buyers took advantage of the increased choice.
For estate agents, it means tougher competition for listings, as Rightmove’s data shows a 32% increase in sellers switching agents in order to find a buyer. It is also presenting a serious challenge to agents in their management of sellers’ price expectations.
It’s worth reminding people that they need to work hard to attract buyer attention.”
Babcock says: “It’s worth reminding people that they need to work hard to attract buyer attention.”
And she warns that, in the current conditions, if a house is overpriced when it goes onto the market and is then reduced, it will take over two months longer to find a buyer.
Looking ahead, though, she thinks that the improving economic conditions could help increase buyer activity. Average earnings, she points out, are now over 5% ahead of last year, outpacing annual house price growth at just 1.2% and with mortgage costs falling, affordability is also improving.
