|
October is traditionally the month with the highest number of properties going under offer, as sales are agreed on September’s new listings and buyers hope to conclude their moves before Christmas. While slower conveyancing may scupper this ambition for some buyers in today’s market, under offer numbers did indeed pick up in October, with 9.7% more than a year earlier according to Lonres’ latest report. However, it is worth noting that buyer demand last October was negatively impacted by Liz Truss’s brief spell as Prime Minister.
The wider market metrics suggest that sellers this autumn may be more motivated than in past years. The number of properties being withdrawn from sale is 4% lower than a year earlier while the number being reduced in price is 15% higher. Compared to pre-pandemic benchmarks the change is even more significant. It may be the case that vendors are reluctant to withdraw and re-list later if they feel that the market will get weaker before it gets better, so are staying on the market longer and reducing asking prices to try and secure a sale.
“There is the feeling that in the final few months of this year we are witnessing a turning point,” says London estate agency Foxtons, as the rate of inflation moderates and after the Bank of England held interest rates steady in September for the first time since November 2021. It’s “a good time to buy” in London, declares the estate agency, arguing that “rising rents and softening house prices mean that, for some, moving into home-ownership is an appealing alternative to renting.” In the first half of 2023, the average price of a one-bedroom flat in the capital was just over £352k (Land Registry), while the average rent was £1,767 (Dataloft). Doing some sums based on these figures and assuming a 24% deposit, Foxtons estimates that mortgage rates would need to rise to 6.5% before renting became cheaper than buying.
|
