NATIONAL HOUSING MARKET UPDATE - SEPTEMBER 2020 - Edwards Estate Agents
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SEPTEMBER 2020 N AT I O N A L H O U S I N G M A R K E T U P D AT E
KEY STATS
E N G L A ND A N D WAL ES
£694,000 £1,034,199 4.49%
£599 £39.5bn 12,779
LATEST DATA QUARTERLY CHANGE ANNUAL CHANGE
MORTGAGE APPROVALS 66,281 -20.8% -0.9%
RESIDENTIAL TRANSACTIONS 70,710 -23.2% -27.4%
GROSS MORTGAGE LENDING £17.4 bn -20.7% -18.1%
NEW HOME STARTS (QT) 24,340 -31.2% -15.9%
NEW HOME COMPLETIONS (QT) 39,550 12.4% 0.6%
2 I PREMIUM MARKETS I NATIONALMARKET OVERVIEW
2 0 1 8 -S UTH
MME EYE
R ABR
O UTH
NC E WA S
AT
The housing
Although the market recovery
festive season continues;
is upon demand,
us, there is little newly agreed
seasonal cheersales and flow
and ‘good will of
to supply
all’
have all across
evident increased. Strengtharena.
the political in demand
Brexit has supported
continues house price
to dominate growth, with
the headlines as all indices
eyes
reporting
await annual
the final growthWhatever
outcome. in July. There may be a little
the conclusion, therecaution in to
are sure thebemarket as thefor
implications
furloughand
sterling scheme is due toAs
the economy. end in October
2018 draws toand other
a close, aregovernment
we any closerinitiatives come what
to predicting to a
close;
we canhowever,
expect inforecasts
2019? remain optimistic.
POST-LOCKDOWN MARKET recession. However, recovery has begun. On a month-to-
GLIMMERS OF SEASONAL CHEER month
Across basis
thetheUKUK economy
prime markets, grewtheby 8.7% inprice
average June,offollowing
property
The summer is usually a quiet period for the housing market; 2.4% growth
is down in May. Although
a fraction on a year the ago.economy
However,has contracted
across many
deals agreed2018
Throughout in thesalesspring complete
volumes andthe
across many put house
housing market andassets
unemployment
2018 has not hasproved
increased, consumerInspending
momentous. the yearintoJuly
the
hunting
have on pause
struggled, to gotoon
thanks theholiday.
backdropThisofyear hasbuyer
lower been different. wasendnoofmore than 10% below its level at the
November the average price of gold has fallen by start of the year,
Since theand
demand housing market
low levels of reopened, we have seen
consumer confidence. demand
However, after
overfalling
1%, between
the stock 30% marketand(FTSE
40% during
100) bylockdown.
6%, whileFlash UK
the S&P
surge and house prices increase. Buyer demand is 34% higher
latest data from the Bank of England indicates mortgage Composite
Global LuxuryPurchasing
Index Manager
is 5.5% lowerIndices,
thanreflecting
a year ago,economic
despite
than the same
approvals in Octobertime last year,4%increased
were higher thanbuyer demand
a year has
ago, while trends in manufacturing,
fine wines and classic carshit aboasting
five-yearsmall
high positive
in July, pointing
returns.
encouraged sellers and the flow of new supply in the last
the total value of lending hit its highest monthly figure since to Many
wider commentators
recovery in thereport economy. The end
evidence of the furlough
of pent-up demand
month
the surgehasinbeen 50% faster
transactions priorthan lastintroduction
to the year. Newly of agreed
the sales, scheme and other
for higher pricedgovernment
properties, with support initiativesvendors
prospective will test the
per agent in August, were 76% above the 5-year average, with
additional 3% SDLT levy in March 2016. More sales took strength
waitingoffor themoreeconomy
clarityinbefore
the coming months.toThe
they commit theirBank of
place
the time across the aUK
to sell home in October
falling 31% than in any
since themonth
start ofsince July
lockdown England scenario, based on no second wave and a smooth
purchase.
2017, while Rightmove data shows properties in 2018 to
(Zoopla). 70,710 transactions completed in July (HMRC), a transition to a new EU free trade deal, expects the economy
date have taken an average of 61 days from the start of
14.5% monthly increase. However, the surge in newly agreed to Ashrink by 9.5% inBALL
CRYSTAL 2020 and to return to pre-Covid levels by
marketing to being sold-subject-to-contract, one day
sales is yet to be seen in the transaction figures, which are the end of 2021.
shorter than last year and an improvement on the 65 days
still -27.4% below July 2019. Strength in demand is supporting Unsurprisingly all current forecasts for 2019 are issued with
witnessed in 2016.
growth in UK house prices. In July, Nationwide reported a THE
a caveat relating to a deal being brokered between the UK
1.5% annual
Despite increase,
the rise in theHalifax
UK base reported a 3.8%
rate in the increase and
summer, and MONTHS
the EU. The GovernorAHEADof the Bank of England, Mark
Hometrack
mortgage a 2.6%rates
interest increase.
remain low. UK Finance report that WeCarney,
expecthas reiterated his forecast that in the event of a no-
transactions to increase over the next few months,
deal Brexit the economy may fall by over 8% and average
at 2.23% the current average mortgage interest rate is lower reflecting the surge in newly agreed sales which take time to
house prices by up to 30%. Current forecasts from the
PRIME
than MARKET
the rate both five and ten years ago, 3.14% and 6.11% complete. July RICS residential survey reported a net balance
Office for Budget Responsibility point to employment levels
respectively. Adjusting for inflation, wages have risen over of +26% of agents expecting sales to increase over the next
continuing to rise in 2019, along with average earnings, while
Thepast
the biggest
year,increase
positive in salesfor
news agreed has taken
household place in the
finances. three months, and slightly negative for the next twelve months,
inflation is predicted to edge back to the government’s 2.0%
prime market. According to Rightmove, there has been a -10% reflecting
target. This may caution
well over
require thea furlough scheme
gradual rise due torates,
in interest
59% increase
SENSE AND in sales agreed for prime properties. Zoopla
SENSIBILITY endalthough
in Octoberthe current view is that the base rate willinrise
and the stamp duty holiday ending March.
to
reported an increase in sellers in wealthier demographic However, the Office
just 1.5 – 1.75% by 2021. for Budget Responsibility central scenario
groups compared
Sensible pricing remains to 2019. July prime
crucial property
to achieving prices
a sale. Thein the UK expects transactions to reach 750,000 this year and almost
increased by 4.49% annually, with the average prime property
average asking price of a property fell by 1.7% in November, 1.5Across
millionthein 2021.
housingThemarket,
increased housing
as per 2018,market
many demand is
the largest
selling November fall since 2012 according to
for £1,034,199. supporting UK house price growth and the RICS
commentators expect the wider UK market to residential
outperform
Rightmove, while annual house price growth has moderated
survey reports a net balance of +8% of agents expecting house
London. An average of independent forecasts predicts price
throughout the year. Annual house price growth across the
ECONOMY prices
growthto increase
across the overUKthewillnext twelve
be 2.2% months.
during 2019. TheIn Office for
UK in the year to September was 3.5%, down from 4.6% a
Budget Responsibility upside and central scenario expect
comparison, those commentating on the London market house
year ago, according to the official UK House Price Index.
The economy shrank 20.4% between April and June and two prices to remain subdued in 2020, however both anticipate
anticipate 2019 may well prove another year of falling
Average prices across London remain slightly lower than a
consecutive quarters of decline have tipped the UK into a
year ago, the capital currently feeling the brunt of Brexit
prices.
strong Compound
price 2022. across the UK is anticipated to
growth ingrowth
be in the region of 11% – 14% over the next five years.
uncertainty. Forecasts for London vary widely, from less than 5% to over
10%. Only time will tell which trajectory is more likely to be
true.
PREMIUM MARKETS I NATIONAL I 3REGIONAL
P R E M I U M M A R K E T S : TOP 5 %
£350,000
£460,574
£420,000
+2.1%
£573,942 £239
+0.7% £411,000
£307 £551,658
+2.2%
£284
£470,000
£619,529
£435,000
–0.9%
£317 £564,378
–0.3%
£276
£388,000
£499,375
+4.2% £687,000
£270 £915,127
0.0%
£464
£600,000
£808,000 £1,460,000
£825,056
£1,130,003 £2,408,843
+4.7%
+2.4% +5.8%
£403
£488 £1,226
4 I PREMIUM MARKETS I NATIONALNATIONAL
P R E M I U M M A R K E T S : TOP 5 %
PROPERTIES SOLD ABOVE THE ENGLAND & WALES
PREMIUM PRICE THRESHOLD
The premium price threshold is 6%
the value over which the top 5%
of property sales occur. The chart
4%
shows a rolling 12 month change
in the average price paid for
premium properties compared
2%
to the previous 12 month.
0%
-2%
-4%
AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL
2019 2019 2019 2019 2019 2020 2020 2020 2020 2020 2020 2020
Source: Dataloft, Land Registry
BY PROPERTY TYPE OVER THE ENGLAND & WALES
LAST 12 MONTHS, PROPERTIES
SOLD ABOVE THE PREMIUM
PRICE THRESHOLD £1,600
An individual premium price
threshold is calculated for each £1,200
property type based on sold £1172
prices in the last 12 months. The
chart shows the average price paid £800
per square foot for all of these
premium properties. £657 £599
£400 £500 £495
0
FLAT/APARTMENT TERRACED SEMI-DETACHED DETACHED ALL PROPERTY
Source: Dataloft, Land Registry
PREMIUM MARKETS I NATIONAL I 5TRANSACTIONS
A N D K EY P R I C E P O I N T S
ALL PROPERTIES SOLD ACROSS ENGLAND & WALES All proper ty £1m+
THE COUNTRY
Chart shows a rolling 12 month 0%
change in transactions compared
to the previous 12 month period -5%
for all properties and those
priced at £1m or over. -10%
-15%
-20%
-25%
JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN
2019 2019 2019 2019 2019 2019 2020 2020 2020 2020 2020 2020
Source: Dataloft, Land Registry
£232,164 £212,923 £181,906
£694,000 £726,047 £568,078
£1,034,199 £1,195,085 £902,373
£219,446 £356,580 £236,290
£549,993 £883,484 £687,179
£753,011 £1,269,345 £1,006,107
6 I PREMIUM MARKETS I NATIONALNATIONAL
MA IN S TR E AM MAR K E T
ALL PROPERTIES SOLD ACROSS ENGLAND & WALES
THE REGION
Rolling 12 month change in 1.5%
the average price paid for all
properties sold compared to the 1.25%
previous 12 month period.
1%
0.75%
0.5%
0.25%
0%
AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL
2019 2019 2019 2019 2019 2020 2020 2020 2020 2020 2020 2020
Source: Dataloft, Land Registry
BY PROPERTY TYPE OVER ENGLAND & WALES
THE LAST 12 MONTHS OF
ALL PROPERTY SALES
£400
Average price paid per square
foot for all property transactions.
£300 £327
£277
£234 £247
£200
£205
£100
0
FLAT/APARTMENT TERRACED SEMI-DETACHED DETACHED ALL PROPERTY
Source: Dataloft, Land Registry
PREMIUM MARKETS I NATIONAL I 7AVAILABILITY
A N D TI M E TO S E L L
AVERAGE NUMBER OF DAYS NATIONAL
TO SELL
Average number of days 100
from when a property is first
marketed on Rightmove to 80 77 76
when the estate agent marks it 71
67 67
71
67
as “sold subject to contract”. 60
64 63 62 62 62 62 64 61
40
20
0
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR
2019 2019 2019 2019 2019 2019 2019 2019 2019 2019 2019 2019 2020 2020 2020
Source: Rightmove
PROPERTIES AVAILABLE TO NATIONAL
BUY PER AGENT
Average stock per agent 60
calculated by the average
number of properties an agent 50
has on Rightmove each day
across the month. 40
30
20
10
0
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR
2019 2019 2019 2019 2019 2019 2019 2019 2019 2019 2019 2019 2020 2020 2020
Source: Rightmove
T: +44 (0)207 079 1515
E: parklane@fineandcountry.com
fineandcountry.com Disclaimer :This repor t is produced for general information only.Whilst ever y effor t has been made to
ensure the accuracy of this publication, Dataloft Ltd accepts no liability for any loss or damage of any
nature arising from its use or from any changes made to Dataloft content by Inform users. Reproduction
of all or par t of the repor t in any form is prohibited without written permission from Dataloft Ltd.
Repor t edited by Inform user and published on 01-09-2020.
Please note, HM Land Registry transaction figures since March are lower than usual
due to the impact of Covid-19. They are likely to be revised upward.
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