Final week of June saw 4x the number of completions as normal

In the final week of the stamp duty holiday (at the £500,000 threshold) there were over 78,000 property completions, four times the usual volume and the highest levels of demand growth have been experienced by the highest priced properties reveals the Q2 2021 Property & Homemovers Report from property and data insight specialist, TwentyCi.

Properties above £750,000 have experienced an 83 per cent growth rate since Q2 2019. Relative growth in the lowest priced bracket for properties up to £150,000 has been much slower than average, with growth rates since 2019 struggling at four per cent.

And the trend is set to continue where, aside from London, the whole of England and Wales at a regional level has between 2 and 1.7 months of property stock left to sell. Overall, the available months of stock numbers are down by half on historical norms. The South West has the lowest level of houses for sale, whilst Inner London currently has the most.

Despite the stamp duty holiday at the £500,000 threshold coming to an end and the £250,000 threshold finishing in September, the number of people wanting to move has risen by 11 per cent since last quarter now accounting for 428,567 households, indicating that it is unlikely the property market will slow down significantly this year.

Those Moving Soon and Moving Now have also increased by 16 per cent and 23 per cent respectively. Compared to Q2 2019 the number of households in the moving journey is up by over 40 per cent, with an additional 500,000 households entering, progressing or completing the process of moving. This significant shift in the behaviour of the home owners can bring huge gains and strong ROI across multiple sectors and categories particularly as homemovers are proven to contribute an additional three per cent GDP per annum over and above the purchase price of the home.

While the residential property market is bouyant across the all style of property, the growth in demand for detached houses and flats has been much greater in 2021 to date than in 2019. They both have compound annual growth rates of 20 per cent per annum. Although semi-detached properties have the largest share of market, their growth is four per cent points off the average.

In comparison to Q2 2019 New instructions have fallen by four percent, whilst the number of sales agreed have risen by 33 per cent and exchanges have increased by 18 per cent. The number of price changes is also significantly down (-39 per cent) as is the number of properties being withdrawn from the market (-21 per cent). With demand exceeding supply there is less requirement for discounting and less stock encourages buyers to remain in transition rather than look for an alternative.

The statistics also demonstrate why the South of England is now so unaffordable for first time buyers without access to additional deposit funds over 10 per cent. The average Loan to Income (LTI) value for properties in the South now stands at 5.78, driven up by Inner London which has a LTI value of 7.7. Mortgage lenders are limited by the Financial Conduct Authority (FCA) on the number of mortgages they are allowed to issue at more than 4.5 LTI which for many first-time buyers rules out the South. The North East of England and Scotland are currently the most affordable locations for first time buyers both with a LTI value of 2.3.

Colin Bradshaw, Chief Customer Officer, TwentyCi predicts that the market will face a “recalibration,” the full extent of which is yet to be seen.

“As we adjust to a society tasked with living with Covid-19 we await the true impact of the pandemic and whether significant volume and momentum that has occurred within the residential property sector, fuelled by generous fiscal policy and a significant change in consumer preferences will sharply recalibrate to pre-2020 levels.”

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