A lack of property for sale across almost the entire country is causing a ‘vicious cycle’, as the limited choice on offer to would-be vendors is preventing them from moving themselves, according to the latest RICS survey released this morning.
New vendor instructions dropped back for a sixth consecutive month, with 22% of RICS residential market survey contributors reporting a decrease.
In total, nine of the 12 areas of the country which RICS monitors saw a decline, with particularly sharp falls in East Anglia. Northern Ireland and the north-east of England were the only areas to see an increase in vendor listings.
The picture painted by the RICS is a similar one across the lettings market where it said tenant demand continued to rise, while landlord instructions failed to keep pace once again.
This is expected to lead to an increase in rents across the UK, with RICS members in the west midlands, the south-east, East Anglia and London expecting the sharpest rent rises in the next 12 months.
The report says: “Respondents in all areas agree that the lack of property for sale is causing somewhat of a vicious cycle, as the limited choice on offer at present is deterring would-be movers, and therefore further restricting new instructions.
“Meanwhile, new buyer enquiries rose for the fourth month in succession at the national level. The vast majority of areas reported some degree of growth, with the south-east region the sole exception.”
Alan Metcalfe, partner and joint head of residential at Halls’ Worcester office, said: “A lack of stock is allowing agents to push appraisal values up, with some achieving unrealistically high figures and some sticking.”
Jan Hytch, of Arnolds in Norwich, reported: “Prices are still strong. However, demand is outstripping supply. Any recent properties are going within hours.”
The survey also said respondents were expecting prices to rise during the year ahead. It projected that in 12 months’ time, all areas of the UK were expected to see “sizeable house price growth”, with confidence most elevated in East Anglia and Northern Ireland.
Simon Rubinsohn, RICS chief economist, said: “A renewed acceleration in house price inflation allied to a fairly flat trend in sales activity highlights the very real challenges being presented by the housing market.
“More worrying still is the suspicion that the imbalance between supply and demand will lead to even stronger price gains over the next 12 months.
“This is also visible in the firmer pattern in the buyer enquiries series which has now risen for four months in succession, reflecting, in part, a further modest easing in credit conditions.
“This trend could be brought to a halt when base rates do eventually begin to rise, but the dovish tone to the latest Bank of England inflation report suggests the first move will come a little later than previously thought likely, and that subsequent increases will be very gradual indeed.’’
Research from property search engine Home also shows that the number of homes currently on the market in England and Wales is 11% lower than this time last year and 39% lower than August 2007.
It said that in the southern regions, buyers had only half the choice which was available to them eight years ago.
It also revealed that prices had increased by 0.6% in England and Wales in the past month, going up 1.5% in London.
My recent experience has been to ask a well known estate agency in Birmingham if I can view an apartment in the city centre. Long story short, I was told come back when you’ve sold your house! Not even sure whether I would then like the apartment if I haven’t viewed it and I would be homeless! Obviously too much trouble to take an hour out if their day for what would eventually be a cash purchase.
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
Maybe the owner has requested only people in a position to proceed can view? – I dunno, but your post tells us a fraction of how that conversation went, maybe the Long Story would help as the short story is a touch one sided.
For instance Do you need to sell to buy? Are you on the market? from this it would be clearer and if the answer is yes to both, you do know they meant once you have an offer on your property you can view not the day after you complete on your purchase?
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
We are finding most applicants registering have nothing to sell or sold.
I think the pension reform has stimulated the buy-to-let market,and we have more and more ftb’s registering. I think many have held off over last few years. With rents increasing they see as an ideal time to make the move.
Shortage of stock is a worry. Some of the valuations round here are crazy but they are still selling!
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
Similar where we are smile. Crazy prices being achieved……I’m not sure if it’s going to be sustainable for too much longer……but then again…..supply and demand….
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
“not sustainable for too much longer” Excellent news, a ****** good property crash required with houses taking longer to sell and “just sticking it on the web” not being enough!
Sort all this Online Only rubbish out and may mean if we all earn less money as a result of the crash, the next RM rate rise (which will happen whether we sell houses or not) may make people think a bit differently on the bigger picture.
Love a good property crash to clear the air.
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
Interesting way to think about that eventuality.
I’d beg to differ.
If online agents really only have 2% of the market as many on this website say and properties aren’t selling who do you think that will hurt the most?
Traditional agents only get paid when a property sells so the situation becomes worse for 98% of the market due to it taking longer to sell whilst online agents (many of whom) are paid up front (and are only 2% of the market) will go along as before.
Surely that makes it worse for traditional high street agents rather than online agents?
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
Evening observer,
Absolutely not!
In a market where selling is perceived as a piece of cake with sellers lining up to buy property and this message assisted by agents claiming to have buyers waiting to pounce when they tout the good old “We have buyers waiting” letter – Then why not try it yourself? Although many clearly don’t try it themselves, there is a fair enough argument put out there by our industry (and this forum proves it) that the websites sell our houses and so many agents actually promote this on valuations. (the proof is in the debates on this forum day in day out)
So in a good market the assumption is simple that Agents will charge me £???? to sell it in minutes off the back of simply listing on RM/Z or OTM.
Seriously how many agents on here, harp on about the websites as if without them they wouldn’t have a clue, playing in to the hands of the budget model. So many will now dislike this comment, but one thing in every web debate I have had on here about RM/Z and OTM is that your brand is more important locally than the national perception of a website. Sellers look local first, the web is just a back up.
anyway…
If the perception is “all we need is our property on the website and namely RM/Z” to sell it and you leave valuing to “vendors” then you would end up with a RM/Z full of over priced houses where vendors are asking too much because they “need it” or more so “want it” when we all know, in a property crash there is a huge skill to changing the expectation of a vendor!
We were refusing to put 50% of property on in 2009 as the expectation was a million miles from reality – this resulted in my company working a lot smarter and still selling most of our stock, resulting in the public opinion wow Ric still sells in any market! – fact was we let the other agents tart themselves out and we only took on the sensible vendors.
Miles Shippydoodar even produced a video on RM talking of how pricing is so important as RM reported record numbers of unsold property in the crash! so my point……..
How long will a vendor wait before turning to a High Street agent to say HELP…… I get no viewings, I get no call, I have no agent advising me, I read the news and I have no idea what to do, yes I’ve paid £500 upfront but that was 6 months ago and I want to move.
Joining buyers and vendors in a bad market is a speciality, you lose £20k but I can save you £23k the examples are endless of how you can shift a property not selling, because the eventual buyer has not sold their own, but who has this knowledge? The local agent who has an extensive buyer/seller database driven by one thing only…. if I sell this house I make money!
Without question if the headlines were property prices falling and houses taking months to sell, the love affair of going straight to the budget model would reduce, that said at 2% it is a pretty poor love affair considering how long eBay, GumTree and every other sell stuff yourself website has been around.
Why has no online Only model not captured 50% of the property market when it is apparently so easy?
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
Just to add to the above comment about the RM video Miles did, I genuinely believe he did this for a reason which was; get the housing market moving for agents, as No Sale No Fee agents would eventually with no income close or demand cheaper fees, which they (RM) would not offer or perhaps could not offer, as shareholder would not be happy.
It was at the very worse time 2008 to 2009, that in my opinion it was in RM interest to get his audience to perhaps listen to the agents who were saying price is key and being ahead of the game with your launch price is vital……that was the message and one which is tough to swallow from your local agent, as nobody wants to hear your house is worth 10 to 20$ less than you thought.
No improvement in the market or sustained levels of unsold property on RM could have lead to the very obvious and valid argument the RM does not assist you, listing on a websites alone is not enough and OTM at that time when income was low, offices closing, people letting staff go and RM rates were rising would have been more interesting…… what other reason would Miles care?
He needed to keep his BIGGEST revenue stream happy all of a sudden as offices closing started to effect them, OTM would have been best launched in 2009 as a logic but nobody would have spent the extra money, so we all happily tarted out to cheap list for free websites thinking it looked like we were doing our bit for the owners, and Z gobbled them all up to become what they were and we created a 2nd monster by accident.
Not sure if anyone remembers his video blog on pricing, but for me it was a real sign to me of him realising he needed High Street agents surviving as they we are the only real source of income for him, FSBO just wouldn’t work nor will a RM of just Online Onlies, as vendors would not pay monthly, so Online only revenue is limited, if the market is not moving.
Basically so many people try and sell in a bad market based on if I could get that price, pay off cards, debts etc I will move, if I cant get that price I wont move or more so cant move! These people don’t want to pay £500 for a listing when they know deep down they have no chance of selling as they are still in Price Denial Syndrome state of the market has dropped but my house hasn’t,
A tough market usually means monthly disposable cash is tight, so paying at the end is always better than throwing £500 away…. think as an average punter strapped for cash in a bad market!
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
% not $ obviously LOL.
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
It does seems ludicrous that we had 2007 BOOM, 2008/9 BUST and now seems 2015 BOOM.
I know the housing market goes in cycles but even as an agent for many years this market seems crazy to me.
Starting price for a run down 3 bed terrace here is now £280k where 3 years ago would be lucky to achieve 200k!
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
Careful Smile…….any stalkers you might have could probably narrow down your location/region with these asking prices………seriously though, it didn’t take long for the neg.eq. to be eaten up from the last recession and send prices to all time highs did it.
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
Ha ha, yes counts me out of central London, the net is closing in!
I think we will see a correction in the market when rates start to rise, which cant be too far away now.
I for one am looking forward to a more stable market!
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register