We often hear in the media about the acute shortage of new homes being built to satisfy increasing demand. Despite the government’s efforts to stimulate the building industry, new build registrations are actually down 6% on this time last year. But how does this affect you if you are not interested in buying a new build property. The answer is more than you might expect.
The reality is that the housing shortage does not only extend to new entrants and first time buyers, but to second time movers as well. According to the NAEA there are 11 buyers registered for every property available for sale, with the lowest number of properties per estate agency since 2004.
Whilst this might sound like a good opportunity for sellers, the problem is that many people who would have put their house on the market are not doing so because they don’t believe they will find anywhere to move to. Don’t worry – if you’ve got a buyer for your property, a good estate agent can usually find a property for you that might not even be on the open market.
Fortunately, due to tighter mortgage lending criteria, prices are not racing ahead as ridiculously they have in the past, so at least you are probably not losing out by selling sooner rather than later. So if you are toying with selling, it’s probably worth getting yourself on the market – no-one’s going to force you out of your home, but you might put yourself in a strong position to make that move.
Let’s look at the latest stats. It certainly looks like there will be some money flowing out of the capital into the provinces, as the gap between London prices and other cities is at its widest for 20 years. London’s price/earning ratio is also at an all time high, making other cities look like a very attractive option for homeowners and businesses alike. Bristol, for example is roughly half the price of London, and prices in Glasgow are around 75% lower!
According to HM Land Registry, house prices are only marginally up on last month and 4.2% up on the year, whilst Rightmove’s reported asking prices are up 6.4% on last year.
Finally, bear in mind that if you are considering a move, if you put your property on the market now, there is every chance you could be in your new home by Christmas. Why not take advantage of the current confidence in the property market, coupled with continued low interest rates and speak to us about how best to plan your move.
Neil Newstead FARLA, MNAEA
CEO – Oakfield Estate Agents