The UK rental market is reaching boiling point according to the latest report from haart as national supply drops 19% annually.
The latest data released have shown that house prices across England and Wales fell by 0.3% on the month and by 2.8% on the year. The average house price now sits at £218,433.
New buyer registrations have risen by 2.3% on the month and by 6.4% annually. The number of properties coming onto the market this month has risen by 2.2% on the month and fallen by 8.1% on the year. In June, there were 13 buyers chasing every property across England and Wales.
The market has become more efficient this month, as the number of transactions rose by 2.6%, which is higher than the increase in the number of viewings (0.4%). This means that buyers chose to view fewer properties before opting to buy.
The average purchase price for first-time buyers has risen by 1.8% on the month but has fallen by 3% on the year. This comes as the number of first-time buyers registering onto the market has risen by 1.9% on the month but fallen by 16.7% on the year.
The average amount first-time buyers are paying for a deposit has risen by 5.5%, but has fallen by 0.2% on the year.
Paul Smith, CEO of haart, the UK’s largest independent estate agent, comments: “It’s promising to see a slight uptick in transactions in June as the nation was momentarily distracted by the Tory Party battle for a new leader. Although Brexit will be at the top of the to-do list for new Prime Minister Boris Johnson, he must also see the property market as one of his top priorities. In his first address as the leader of the Party, he spoke of “instincts to own your own home”, but only time will tell whether this transpires into meaningful policy to help the UK maintain its status as a homeownership democracy.
Rumours of a stamp duty reshuffle are promising. Our branches saw an annual increase in the number of first-time buyers registering to buy reach 21% in the months after the Chancellor cut stamp duty for this part of the market. Should Boris provide further relief for home buyers, either by expanding on the stamp duty exemption threshold or by switching the tax from buyer to seller, we could experience a similar rise in applicants registering to buy or indeed sell, depending on which option he chooses.
However, there is more Boris could do to incentivise other areas of the market. The rental market is hitting boiling point, as landlords continue to stray away from the buy to let market and the number of tenants registering to rent continues to rise. Nationally, there are 23% more tenants looking to rent properties annually, but rental supply is down by 19% over the same period. This is particularly acute in London, where supply is down by 37%. As a result, rents have risen by 7% on the year in the Capital. We are now at risk of pricing young Londoners out of renting, as well as owning a home. I urge Boris to relax taxation against landlords to encourage investment in housing stock again.”