Shortage of stock, new instructions down and new buyers increasing
November 5, 2021
Like many homeowners, you will have most likely noticed a significant increase in junk mail pouring through your letterbox courtesy of the local high street estate agents in your area.
You know the ones we mean -
"We have buyers looking for properties just like yours."
"We have a family that wants to buy a property in XYZ street."
"Thinking about selling - would you like a free valuation?"
We can see why high street agents are getting desperate to find those rare new listings when looking deeper into the data and the latest property reports.
For example, the Royal Institute of Chartered Surveyors (RICS) released the results of their UK Residential Market Survey for September which highlighted the ongoing decline in new listings coming onto the market showing little sign of abating. According to their data, "The September new instructions net balance registered a figure of -35% (compared to -36% last time) and has now been in negative territory in each of the last six months."
In addition, the survey highlighted that the number of appraisals undertaken during September was below the rate seen twelve months prior, with the net balance slipping to -26% from -10% back in August.
At the same time demand from buyers is ever-increasing in both the owner-occupier and buy-to-let space.
The lack of stock available on the market is creating even more competition amongst buyers, which in turn is continuing to create upward pressure on prices. This pressure is starting to slow in many areas suggesting prices might have started to peak. This may also simply be the result of mortgage providers and valuers taking a much more cautious approach.
At Vesta we have been inundated in buyer demand and a flurry of new tenanted property listings to match. Landlords and investors alike are making several trades and we are now often seeing properties being sold in one area and the vendor, with their resulting positive cash position, then looking to purchase a new batch of properties in another area.
Yield continues to drive investor focus with strong competitive demand for high-yielding assets across the country, particularly the Midlands and North England. HMOs are literally flying off the Vesta shelves.
However, more recently on Vesta we have once again seen increased interest in Greater London, where the yields are historically much lower but capital gains much higher. This renewed interest is possibly driven by investors speculating on the fatigue of home working and driving more people to spend time at work (in the office) and once again meet face to face. The resulting, once again packed, commuter trains and underground might just mean many people are re-thinking their rental options and considering a move back into the easy city commuter areas within the M25.
If you are considering selling or buying an investment property or simply want an investment valuation, please get in touch, or visit www.vestaproperty.com/sell so we can start the process with you.
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