The property market is in the best shape to sell in more than two decades, OnTheMarket’s boss has said, but sellers are being spooked by the lack of stock and the rapid rate at which homes are being snapped up.
Some 73 per cent of UK buyers felt confident that they would purchase a property within the next three months, according to OnTheMarket’s property sentiment index.
Meanwhile, 79 per cent of sellers were confident that their property would be bought within the next quarter – as more than half the property site’s real estate were Sold Subject to Contract (SSTC) within just 30 days of first being advertised for sale.
The speed at which homes are being bought has climbed six per cent since August last year, as the lack of stock begins to push an “interesting dynamic” within the market, CEO Jason Tebb explained.
“Buyer confidence remains relatively stable across all of the UK, but according to our survey responses, seller confidence seems to have cooled slightly in a couple of the regions,” he said, adding that “We’d suggest this is a consequence of sellers being aware that their home will sell quickly, given the current market conditions and buyer demand.”
“However, they are encountering challenges in finding a suitable property to purchase, due to the well documented lack of stock, which in turn is causing them to hesitate putting their own property on the market.
“In other words, a lack of stock is perpetuating a lack of stock in the best market in which to sell a property in over two decades.”
Concerned sellers are acting as a ‘brake factor’ in the property market, OnTheMarket’s research found.
Despite the annual “seasonal lull” towards the end of summer, with some sellers even racing abroad for a few days of sun, Tebb added that the firm’s properties had been drawing “multiple competitive bids” over August.
“That aside, stock is still going under offer in near-record time in most areas of the country, so on holiday or not, motivated movers were still highly active and driven to get the deal done.”
No ‘new normal’
The property boss urged that these unique market conditions are not the “’new normal’ and, as with any market cycle, activity will plateau at some point in the next few months”.
Tebb advised potential sellers to be mindful of mortgage down valuations, which have been on the rise, as competitive buyers enter bidding battles over a reduced supply of ‘dream homes’.
“There’s one thing agreeing to an offer above your asking price, but if that property is being purchased with a mortgage, then sellers need to be aware that ultimately, it’s the valuer on behalf of the mortgage lender who will dictate the price achieved.”