House prices hold steady as market maintains momentum: Rightmove

“Some potential sellers appear to be watching and waiting rather than taking action, evidenced by a dip in the number of new sellers coming to market, particularly at the top-end. This is understandable when many of these sellers have more flexibility over when they act, but overall, it appears to be business as usual for the mass market”
– Tim Bannister – Rightmove

The latest market analysis from Rightmove has revealed that the price of a typical property coming to market dipped by just £21 this month (0.0%) to £375,110.

Pricing remains varied across Great Britain, with the strongest price growth this month seen in the less expensive and more northerly regions. According to the data, five of the six cheapest areas are reaching new price records. By contrast, the higher-priced East of England and London regions lag and see this month’s only regional price falls.

Now that a General Election has been called, analysis from Rightmove suggests that activity is largely remaining stable, with the market maintaining its 2024 momentum. The number of sales being agreed upon and the number of buyers sending enquiries to agents remain steady, with the vast majority of those already in the home-moving market continuing with their plans.

Election caution

One exception is possible election caution among some would-be sellers, which is most pronounced for those at the typically more discretionary top end of the market, some of whom appear to be pausing their plans to see how the next few weeks unfold.

Rightmove’s Tim Bannister comments: “It’s always difficult to predict how home-movers will react to sudden uncertainty, but looking back through our data, we can see that during previous election campaigns, market activity has remained largely steady.

“This election has followed a similar pattern so far, and the responses from our poll of over 14,000 people also support the data, with the vast majority of respondents saying they will carry on with their home-moving plans.

“However, some potential sellers appear to be watching and waiting rather than taking action, evidenced by a dip in the number of new sellers coming to market, particularly at the top-end. This is understandable when many of these sellers have more flexibility over when they act, but overall, it appears to be business as usual for the mass market.”

Pent-up demand

Pent-up demand is a key driver behind increased buyer and seller activity, despite mortgage rates remaining elevated for longer than anticipated. In the first four months of the year, the number of sales being agreed between buyers and sellers is 17% higher than in the same period in 2023, outstripping the 12% increase in the number of new sellers coming to market.

Like pricing activity, these trends are being driven most by the top-of-the-ladder sector, made up of four-bedroom detached and five-bedroom plus properties. A lack of available homes for sale in this sector during the pandemic years, together with the rapid rise, and subsequent volatility of mortgage rates in the post-mini-Budget period, meant that activity in this sector was particularly susceptible to some potential movers taking a step back.

With mortgage rates remaining stable, albeit still high, and greater buyer choice, many who had postponed their moving plans in this sector appear to be returning.

Rightmove anticipates the number of completed sales transactions this year will reach around 1.1 million.

Time on the market

However, the lengthy time to complete a sale after finding a buyer remains a challenge for both agents and movers. The average time between agreeing on a sale and legal completion is a painful five months or 154 days.

In total, it takes over 7 months on average from a seller coming to market to completing their move, meaning that as early as it may seem, would-be sellers hoping to celebrate Christmas in a new home need to be coming to the market about now.

The sluggish completion process in England is something that parliament is reviewing as part of its inquiry into improving the home buying and selling process. When compared with international markets, England’s average completion times are significantly slower, highlighting the substantial room for improvement.

The creation of a more seamless process, which includes providing more accurate information about a home earlier to potential buyers, and better connecting the parties involved in the transacting process through technology, are two areas of improvement that Rightmove suggests would be most beneficial to movers.

One strategy, according to Rightmove, is to work with an estate agent to price competitively from the outset of marketing and avoid the need to reduce the asking price after coming to market. It takes on average 32 days for a sale to be agreed for a property that is priced right from the outset, less than a third of the 112 days that it takes if the home requires an asking price reduction before it has found a buyer.

Tim Bannister concludes: “We expect that the improved market activity levels and conditions this year will result in higher transaction numbers at the end of 2024 than last year.

“However, the extremely lengthy legal completion process is a frustrating barrier to home-movers converting agreed sales into completed transactions more quickly. It may seem surreal to be thinking about Christmas in May, but we know that many would-be sellers picture celebrating the festivities in a new home, and to achieve that, now is the time to be coming to market.

“One strategy that is still giving some sellers the edge in this price-sensitive market, is working closely with an estate agent to price attractively right at the start of marketing, to give themselves the best chance of finding a buyer quickly.”

Nathan Emerson, CEO of Propertymark comments: “It’s extremely positive to see stability within the housing market and despite a challenging period of high inflation and elevated interest rates, we are witnessing people approach the market with growing confidence.

“If conditions permit, we are hopeful to see the Bank of England start reducing the base rate when they next meet on Thursday. Should this happen, a potential raft of competitive mortgage deals over the coming weeks would be very welcome news for many people.”

Matt Thompson, head of sales at Chestertons, says: “We are now in the last days of the typically busy spring market and, compared to last month, are seeing a bounce in buyer activity. Particularly since the date for the General Election has been announced, house hunters who have been on the fence due to political uncertainty have become more confident about going ahead with their purchase. As a result, we expect June to conclude with a heightened level of buyer interest.”

Myles Moloney, area sales manager at Chase Buchanan, says: “June’s property market to date has remained positive and house hunters with larger equity and buying power have pushed on to agree a sale as they feel the result of the election is forgone. Buyers who are only just starting their property search, however, have been slightly more cautious to observe how the manifestos could benefit them during their property buying journey – particularly first-time buyers.”