Sales and lettings markets in UK saw major change in 2017
It has been a busy year for the sales and lettings property markets in the UK with ups and downs in both sectors, according to an overview from agents.
Perhaps one of the most striking trends was the number of properties that sold for less than their asking price, on average 77% of the time, while only 4% were sold for more than the original asking price.
According to the National Association of Estate Agents (NAEA) demand spiked in January and February with 425 house buyers registered per branch. Demand was higher than in 2016, with an average of 380 prospective buyers registered per branch, compared to 365 on average over the course of last year.
Supply of housing peaked in February with 44 properties available to buy per branch. Year on year, supply has not shifted, averaging at 39 properties available per branch in 2016 and 2017.
February and June saw the highest number of sales agreed, with an average of 11 per branch compared with 2016 when the number of sales agreed peaked in March, with 10 per branch. On average, the number of sales agreed was up in 2017 with an average of nine per branch every month, compared to eight in 2016
However, the proportion of total sales made to first time buyers on average over the year hit the lowest since 2013. Some 25% went to first time buyers in 2017 compared with 28% in 2016, 25.4% in 2015, 25.6% in 2014 and 23.7% in 2013.
According to Mark Hayward, NAEA chief executive, looking ahead the abolition of stamp duty for first time buyers should boost numbers in 2018. ‘We still only have a limited supply of housing available and policymakers need to think about how to help others in the chain, such as second steppers and those that would downsize in order to free up more larger homes suitable for families,’ he said.
January was also the highpoint for supply in the lettings market, according to the Association of Residential Letting Agents (ARLA) when supply of rental properties were at their highest at 193 per branch. On average in 2016, the number of properties available per branch was 180, compared to 188 from January to October 2017.
The ARLA overview also shows that this year the number of buy to let landlords selling their properties peaked in March and April when agents reported a 33% rise in the number of landlords selling up.
In August, the number of tenants experiencing rent rises peaked at 35% before falling to 27% in September. Rents for tenants were least likely to increase in October but overall in 2017 some 27% of tenants had their rents increased compared to 26% in 2016.
On average, properties were viewed more times before being let in 2017 than in 2016. Last year letting agents typically hosted five viewings per property which rose to six in 2017.
‘It was always going to be an interesting year, following the announcement of the letting agent fee ban in last November’s Autumn Statement. I think we’re starting to see a consolidation of some agencies in the industry as the fee ban looms, which could explain why the number of properties under management has increased,’ said David Cox, ARLA chief executive.
He pointed out that landlords are becoming more selective about their property investments in light of last year’s stamp duty changes. ‘Mortgage Interest Relief (MIR) is starting to bite which is why we saw an increased number of landlords selling up. It’s likely that as we move into 2018, tenants will continue to see rent increases as supply starts to reduce, demand continues apace, and legislative changes increase costs for landlords,’ he added.