Housing supply

Spring launch of UK housing supply with 21% increase in listings

With real estate listings finally up – and up significantly – could this be the beginning of the end for the country’s housing supply problems?

The latest figures reveal a much needed increase in the number of new properties coming to market in the UK. Although buyer appetite remains strong, this could ease some of the pressure and slightly ease the buying frenzy seen in recent months.

Propertymark’s February housing market report reveals that the average number of properties listed per member agent branch rose 21% from January. This brings the total number of properties for sale at each member branch to an average of 23.

The number of agreed sales per branch in February increased only slightly, according to the report, from seven in January to eight in February. This is still the highest monthly sales number since October 2021, after a slight Christmas lull.

UK housing supply versus demand

The number of homes registered per agency branch for sale has been slowly declining since July last year, so the news is certainly positive for the sector. This shows that sellers are more confident and eager to get the ball rolling heading into 2022.

However, in comparison, the number of registered house hunters at each estate agency across the UK sheds a harsh light on the housing supply and demand situation. In February, Propertymark data showed there were 590 potential buyers per branch.

This figure has been on the rise, with peaks and troughs, since last year. This means that for every property available for sale, there are 26 potential buyers.

What about prices?

The data shows that, unsurprisingly, many homes continue to sell for more than the asking price. February figures reveal that 39% of all properties sold above their original asking price.

This is a 2% increase since January and the highest figure since June of last year, when the market was particularly hot. Meanwhile, 41% of properties sold at a bargain price and only 20% of buyers got a good deal with a lower bid price than the ask price.

First-time buyers are also doing well at the moment, it seems, as 37% of all sales have been to new owners.

Nathan Emerson, Managing Director of Propertymark, said: “It is very positive to see more properties entering the market. The number of new buyers wanting to sign up is starting to dwindle, but agent books are still teeming with those who are still waiting in the wings and have missed out on previous properties.

“The number of properties exceeding the asking price is still a figure more than three times higher than what we would see in a pre-pandemic market, but with the cost of living, energy and interest rates all looking to increase, it is possible that we will start to see buyers being more careful with their money.

Empty house solution

Of the myriad ways to solve the UK’s housing supply problems, Propertymark recently flagged the country’s empty homes as a starting point.

Earlier this month, the industry body wrote to Michael Gove, the Secretary of State for Levels, Housing and Communities. He demanded that the government step up its plans to ease the housing crisis, which is affecting the private rental sector as well as buyers.

While the government previously doled out £100m through its empty homes scheme, this was shut down in 2015. As well as relaunching a scheme to bring properties back to life, Propertymark has called for incentives such as the removal VAT on energy efficiency improvements.

It also suggests reducing or exempting buyers from paying council tax and stamp duty in a bid to encourage them to buy and use empty properties. All this could put us on the path to a considerable increase in housing supply.