Further signs of market rebalancing as housing stock levels hit 15-month high

The rebalancing of the housing market continued in August, while sentiment among home movers remains robust, the latest OnTheMarket (OTM) Property Sentiment Index shows.

Despite the well-publicised considerable headwinds and ongoing cost-of-living challenges many people are facing, 73% of active buyers in August remained confident that they would purchase a property within three months, down slightly from 75% in July. Similarly, sellers remained upbeat with 79% confident they’d sell their home within three months, slipping marginally from 80% in July.

But while the overall sentiment picture remains relatively strong, OTM says that there are regional variations.

Last month saw a marked dip in seller confidence in Greater London with 76% of sellers in July confident they could sell within three months compared with 85% in June. In August, that figure recovered to 84%. Meanwhile, as seller confidence improved in Greater London it receded in the North East of England, with 77% of sellers in August confident they would move within three months, compared with 83% in July.

According to the property portal, gardens remain top of many buyers’ wish lists, with ongoing demand for more outside space a continuing legacy of the pandemic. Parking and a garage are the next highest priority buyer demands across the UK as a whole.

How long properties take to sell is one of the key indicators of the health of the housing market, and this metric remained fairly robust even in August, when the holiday season tends to result in a slowdown in transactions.

In August, 54% of properties were Sold Subject to Contract (SSTC) within 30 days of being advertised for sale, compared with 57% in July 2022, and consistent with 54% when compared with August 2021. The dip in August 2022 compared with July suggests that seasonality has returned to the market as we’ve mentioned previously, and it’s perhaps surprising that the numbers are as strong as they are, given so many people took the opportunity to get away this year.

As we head into autumn, with the cost-of-living set to continue to rise, the expectation is that there may be less buyer competition for property. September tends to be the biggest listing month of the year after May, and with August seeing the highest stock levels since April 2021, this increase in the number of homes for sale may coincide with potentially fewer buyers. Some may decide not to move due to rising costs, whereas six months ago this may not have been the case.

Despite all the evidence of a rebalancing of the market, confidence would appear to remain among serious property seekers. The resilience of the UK property-seeking public and how they feel about the market is remarkable, and yet provides a key indicator in terms of how UK consumers perceive the long-term value of ‘bricks and mortar’.

 

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