FTBs reaping rewards from August price drop

19th September 2017

The latest data and analysis from independent estate agent, haart, has revealed that house prices across England and Wales in August dropped by 4.1% on the month, but are up 0.8% on the year. haart places the average house price now at £230,964.

New buyer demand for homes rose by 1.8% on the month but is still down 7.7% annually. Additionally the number of properties coming onto the market has fallen by 7.6% on the month, and is down by 14% on the year. This month there are 9 buyers chasing every property across England and Wales.

The market has become more efficient this month, as the number of transactions has increased at a higher rate than the number of viewings. Meaning that buyers are choosing to look at fewer properties before they buy.

The average purchase price for first-time buyers has fallen by 10.2% on the month, and is down by 1.3% on the year. This comes as the number of first-time buyers entering the market has fallen by 2.2% on the month, and by 22.3% on the year.

Despite average purchase prices rising, the average amount paid for a deposit has fallen on both the month and the year.

The average property price in London has fallen by 2% on the month, however has risen by 4.2% on the year. Annual growth was greater than the rest of the UK. The number of new buyers entering the market has risen by 2.1% on the month, and is down by 28.1% on the year. At the same time, the number of new instructions has fallen by 14.1% on the month, and by 18.4% on the year. Sale transactions are down 6.8% on the month, and 27% on the year.

The number of tenants entering the market across the UK has risen by 6% on the month, however is still down 29.3% annually. Despite the rise in demand, rents have fallen marginally at 0.2% on the month. The average rent now sits at £1,268 across the UK. Demand in London has also risen by 2% on the month, however is down 29.7% annually. London rents have risen by 0.3%, and the average rental price now sits at £1,788.

The number of landlords registering to buy has fallen this month by 0.2% across England and Wales, however has risen by 3% in London. The annual fall is greater, 17% and 34% on the year respectively. The number of buy-to-let sales rose on the month by 9.5% in England and Wales, and rose by 0.1% in London. This came as sale prices fell by 0.6% across England and Wales, and rose by 7.1% in London. This is down 1.4% on the year for England and Wales, and 12% in London.

Paul Smith, CEO of haart, the UK’s largest independent estate agent, comments: “First-time buyers benefited from falling prices in August, as the housing market reached the low of the summer slowdown. First-time buyer prices fell by 10% on the month, dropping to their lowest level since August 2016.

Transactions across the board still remain 14% down on where they were a year ago – however I sincerely believe we have reached the bottom of the market. Prices are still rising, but at a slower pace than inflation, and now that unemployment has reached a record low it’s only a matter of time before interest rates climb back up again. The savvy buyer will act now before prices begin to rise at a faster pace.

With 9 buyers chasing every instruction across the UK, 15 across London, and as we are seeing almost 100% of asking prices achieved across many of our London branches, it is impossible to deny that the demand to buy is there. Housing has been a bottom of the pile priority for Government ministers for too many months whilst the ins and outs of Brexit are debated. Now, in the midst of a housing crisis, is hardly the time to take a step back on housing policy. We need to see real reform to make real change on the ground now.”

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