As we near the end of 2017, NAEA (the National Association of Estate Agents) and ARLA (the Association of Residential Letting Agents) Propertymark have analysed their sales and lettings data for the year, to offer a property market overview…
In 2017, demand for homes spiked in January and February, with an average of 425 house hunters registered per NAEA member branch. Demand was higher this year than in 2016, with an average of 380 prospective buyers registered per branch, compared to 365 over the course of last year.
The supply of housing peaked in February, with an average of 44 properties available to buy per branch. Annually, supply has not shifted, however, averaging 39 properties per month in 2016 and 2017.
February and June experienced the highest number of agreed house sales, with an average of 11 per branch. In 2016, the amount of sales agreed peaked in March, at ten per branch. On average, the number of sales agreed was up in 2017, with an average of nine per month, compared to eight in 2016.
The proportion of total sales made to first time buyers, however, hit the lowest level seen since 2013 this year, at 25%.
In 2017, properties were sold for less than the asking price 77% of the time on average – just 4% were sold for more than the original asking price.
Mark Hayward, the Chief Executive of NAEA Propertymark, comments: “2017 has been a busy year for the property market, and the Budget announcement to abolish Stamp Duty for first time buyers has given them some optimism. This year saw an average of 25% of sales to first time buyers – the lowest in four years.
“Looking to next year, it will be interesting to see what impact the Stamp Duty change had on the market, and if it really does help first time buyers get on the ladder. 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.”
In the private rental sector, the supply of properties was at its highest in January, when it stood at an average of 193 per ARLA member branch. In 2016, the average number of properties available per month was 180, compared to 188 from January to October 2017.
This year, the amount of buy-to-let landlords selling their properties peaked in March and April, when letting agents reported a 33% increase in the number of landlords selling up.
In August, the amount of tenants experiencing rent price hikes peaked at 35%, before dropping to 27% in September. Rents were least likely to rise in October (22%), but, overall in 2017, 27% of tenants saw prices increase, compared to 26% in 2016.
Tenants were the most successful at negotiating rent reductions in March (3.6%). In 2016, the most successful month for rent negotiations was December, when 3.1% of tenants were successful.
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.
David Cox, the Chief Executive of ARLA Propertymark, responds to the findings: “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.
“Landlords are becoming more selective about their property investments in light of last year’s Stamp Duty Land Tax 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.”