In recent years, as a result of Brexit, it has proved very difficult to escape politics. With an election looming, it’ll be impossible. From now on, we will be bombarded by politicians’ promises about how they are going to improve Britain’s ‘broken’ housing market. Some of the ideas will be sensible, others will be terrifyingly ill-considered, but most will never come to pass.
Traditionally, the housing market slows a little before a general election, but then picks up where it left off, a few weeks afterwards. This time around, it may be a little different. There is not much time for the market to slow down any more than it already has and the election will take place during the quieter Christmas period. However, once it is over, we will be heading towards the spring market which, in reality, kicks off in February. With pent up demand building, if there is any kind of certainty, it could produce a substantial boost for the market.
In the meanwhile, according to Rightmove, it’s sellers that are currently behaving more cautiously, not the buyers. In fact, Miles Shipside, Rightmove director and housing market analyst says:
“Thousands of potential sellers are holding back compared to this time a year ago, though the number of buyers agreeing purchases is virtually the same. Ironically, this means that those who are coming to market have a better chance of selling, so while some would-be sellers are being put off, it’s actually a good time to sell. Those who are ignoring the Brexit disruption have less competition, and their prospective buyers have less negotiating power, with a reduced choice of suitable alternatives.”
The average number of new listings per week has dropped to 24,539, their lowest October total since 2009 and a 13.5% reduction when compared to the same period last year.
Rightmove speculates potential sellers are being deterred by the lack of price momentum, with new seller asking prices 0.2% below where they were this time last year. The number of buyers, on the other hand, has held up well but their lack of choice may be putting some off, at least until after the election, when both buyers and sellers are likely to get more active.
In the capital, the scarcity of sellers has provided an even bigger boost to house prices, which rose by 2.4% in Greater London and by 3.3% in Inner London during October. It’s the result of a huge 29.2% fall in the number of new sellers compared to the same month last year and looks like yet more evidence of the London market’s gradual recovery. Since it is where house price trends begin, it is very welcome news indeed.
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