Henry Pryor Blog

Friday 6th January 2012

With the results for November released by HM Land Registry, we can now begin to assess just how 2011 was for the housing market. 

Asking prices took a dramatic fall in the last two months of the year, falling 5% in the last two months – a good thing, since vendors and their agents had stubbornly refused to acknowledge that sale prices had been trending significantly lower for some time.

There was a big gap between average asking prices as reported by Rightmove and average selling prices published by the Halifax. Whilst not exactly the same data, the trends tell the important story – that those selling are still asking just about the same that they were when the market peaked in 2008, yet those actually selling are making roughly 12% less than they did in that same year.

Volumes remained thin, with half the number of homes sold in September in England and Wales compared with August 2007. November’s figure of 61,031 was admittedly a 17% rise on the same month in the previous year, but over the UK only 850,000 properties sold during the whole year – a slight fall on 2010. In 2006 and 2007, more than 1.6m were sold each year.

London has avoided the pain being experienced in many other areas of the country; for example, prices in Hartlepool are 19.8% lower than they were 12 months ago. International buyers have helped maintain prices and volumes in the capital, although the proportion of £1m homes sold in London has fallen from 67% of all £1m-plus sales in England and Wales in January two years ago to just 36% in September – which is the long-term average, as it happens.

There was no real shortage of property for sale.

The number of homes typically on the market during 2011 remained at around 879,000, much as it was the previous year, although the number was maintained by slightly slower numbers of new homes coming on to the market and fewer homes selling.

Average asking prices tumbled eventually, but still ended the year up 1% on 2010, while the Halifax and Land Registry recorded average sale prices in 2011 of 2% lower.

The chances of selling did rise last year but remained at less than 50%.

In December 2006, you had a 14% chance of selling in the first month of marketing your home. Across 2011, it had fallen to just 7%, but things improved slightly towards the end of the year.

Today you have a 9% chance of your home selling in month one, but still only about a 50:50 chance if you leave it on the market for a year.

And this year? I believe it will produce more losers than winners.

Predictions for prices vary from ‘no change’ to my own admittedly bearish minus 10%.

Importantly, the market remains hugely varied, with some areas doing much better than others. It is important to remember, though, that as with any competitive market, there must be winners and there must be losers.

Like the residents of much of Northern Ireland (down 8% over 2011 and prices half what they were in 2007) as well as Hartlepool (down 19.8%), there will be those who will suffer massive devaluation but elsewhere there will be others who actually make money in property.

(3) Comments

Added by PeeBee on 2012-01-09 14:10:18

Nice to see you being upbeat, Pbro!

The only thing you haven't mentioned (and the ONLY thing that really matters when it all comes down to it..) - offers/sales agreed?

I trust that is simply because you can't keep up the count? ;o)
Added by PbroAgent on 2012-01-07 14:40:50

I'll tell you what I'm seeing since Christmas:
Applicants on the rise.
FTBs on the rise.
Viewings on the rise.
Valuations and listings on the rise.
Vendors realistic.
Prices steady.

What am I telling customers? "Fill ya boots!"

We're only one week in but here's hoping for more of the same!
Added by PeeBee on 2012-01-07 11:21:31

Mr Pryor. We meet again. This time is going to ber no different from any other.

You believe that your words will shape the market. Let's have a look at how well you did a year or so ago - in your blog dated Monday 29 November 2010:

Firstly, you said way bach then: "Put your house on the market today and you have just an 8% chance of selling by Christmas. At these rates, if you put it on for the whole of next year you still only have a 35% chance of selling it!
; to which above you now state "Today you have a 9% chance of your home selling in month one, but still only about a 50:50 chance if you leave it on the market for a year. BRILLIANT! The possibility of selling in just one month has RISEN by TWELVE percent; and THIRTY PERCENT better for those who stay on the market for a year (although in my humble opinion they would be far better to remove it after about month four and try again later...)

Then, you stated "

In summary, my predictions of next year are:

Main indices down 10%-plus by end of 2011.

Volume of sales down from 890k to around 700k by end of 2011."

The reality? Well - according to your words above: "...over the UK only 850,000 properties sold during the whole year – a slight fall on 2010..." followed by "...the Halifax and Land Registry recorded average sale prices in 2011 of 2% lower."

Oh, dear. Maybe fortune telling is not your strong point after all, Sir... Here's the last example:

"Whilst I see many examples of deals being done at way below asking price, the market indices do not show the anticipated falls of 20% or more, and therefore it is with some trepidation that I prognosticate on 2011. 

I see little evidence to suggest that the falls I had expected to turn up this year will not show up eventually."

Care to quantify "eventually", Mr Pryor?

NOW to the above. "for example, prices in Hartlepool are 19.8% lower than they were 12 months ago." NO, Mr Pryor, they are not.

I wouold once more respectfully suggest you consider amending your constant statements heralding these 'drops' to read more factually - such as "The AVERAGE sale price of the properties which were included in the most recent report issued by Land Registry is 19.8% less than the AVERAGE sale price of those properties reported by Land Registry in their report one year earlier".

It is extremely doubtful fhat one in a hundred of these statistical properties were included in BOTH sets of figures. I trust that you agree with this?

Therefore it cannot be stated that ACTUAL increases or reductions are occurring.

Gamekeeper turned poacher, Mr Pryor. I wonder what points you would be making out of your carefully-researched statistics if you were still acting for SELLERS rather than BUYERS...?

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