Sellers getting on the market before price slowdown

The prime country market outside of London appears to be booming again in a rush to beat a slowdown in house price growth.

Analysis by Knight Frank claims the number of offers accepted in the regional prime market in April was the highest for the month in 15 years.

Around 170 offers were accepted, surpassing the previous record of 160 set last year during the stamp duty holiday.

The agent suggested that sellers have been motivated to act during one of the property market’s busiest months to cash in on gains ahead of an expected slowdown later this year.

With the cost of living rising and supply starting to pick up, Knight Frank expects double-digit growth in the country market to decline to single digits by the end of 2022.

This fresh impetus has also seen sale times reduce.

The median time from instruction to an offer being accepted fell from 57 in March to 56.5 days in April. 

This is the shortest time since last June, when the figure was 54.5 days during the frenzied final month of the full stamp duty saving.

Knight Frank said the demand/supply imbalance that has kept upward pressure on prices looks set to persist through the spring market, although supply continues to build gradually. 

Market valuation appraisals were up 3% in April versus the five-year average, excluding 2020, Knight Frank said.

In contrast, the number of new prospective buyers was up 25% versus the five-year average, excluding 2020. 

Russell Grieve, office head at Knight Frank Haslemere, said: “Having taken stock during the first three months of the year people are now coming to market and being decisive. Where property is realistically priced, it is selling quickly and attracting competition.

Charles Probert, office head at Knight Frank Hereford & Worcester, added: “This is the time to sell and people have recognised the market is hot. It’s also a good time to accept an offer, as more property will continue to come to the market over the next few months.

“We’re still seeing a lot of demand, with lifestyle changers looking to buy in the area, alongside families and those looking to down-size.”

It comes as data from estate agency Chestertons suggest that house hunters are feeling a new sense of urgency to find a property ahead of future interest rate hikes. 

In April, cumulative data from the agency’s 32 branches registered a 39% annual uplift in sales enquiries

With the Bank of England stating that inflation is likely to rise to around 10%, further interest rate rises are expected.

As a result, Chestertons is predicting buyer registrations will continue to grow as well, creating an even more competitive housing market.

According to the agency, the volume of new buyers who have registered this year are already at a record ever level.

Chestertons also revealed that it has seen a 35% annual drop in in the number of sellers willing to reduce their asking prices due to demand outstripping supply.

Cory Askew, head of sales at Chestertons, said: “This month’s rate rise has had the same immediate effect of the last two rate rises: a surge of new buyers eager to close a deal before rates rise again. 

“Our sales enquiries are up year on year but those buyers are chasing 15% fewer property on the market. An imbalance that is pushing prices up in most locations.”
 
Guy Gittins, chief executive of Chestertons, added that, in addition to a more competitive market, house hunters need to be prepared for their property transaction to take longer than expected. 

Gittins added: “Although the market is no longer seeing last year’s level of delays, solicitors and valuation surveyors are still facing an immense backlog of sales which can result in a prolonged wait for a deal to be finalise.”