Property sales rise but sellers are urged to price realistically 

The level of sales agreed has reached its highest point this year and is encouraging more sellers to the market, Zoopla claims.

The portal’s latest House Price Index for May shows sales are up 11% on the five-year average according to Zoopla’s latest House Price Index. 

The flow of new homes for sale is also up 16% on the five-year average, Zoopla said.

Around one in ten homes currently listed for sale on Zoopla were previously rented out - down from a pandemic-driven peak of 14% in 2020, which the portal said shows a landlord sell-off is continuing.

Price cuts remain though with 18% of homes currently listed for sale on Zoopla having had the asking price cut by 5% or more.

This compares with 28% in February. 

Meanwhile, demand is down 14%, Zoopla, said, adding that there is no evidence of any material build-up in an unsold stock of homes. 

It said: “The number of homes listed for more than 90 days in most areas is in line with the five-year average. It suggests that while new sellers will need to set asking prices carefully, there is no need for larger price falls to clear stock at this stage.”

The research showed house prices have fallen by 1.3% in the past six months to £260,700.

Zoopla said the speed of falls is reducing as buyer confidence slowly improves.

The property website suggested mortgage regulations have helped dampen the impact of higher mortgage rates on house prices so far, although it said the rebound in activity could be impacted if rates start to increase in the second half of the year.

The report added: “The biggest hit to housing activity in 2023 will be seen in the number of housing sales which are on track to be 20% lower than last year.”

Richard Donnell, executive director at Zoopla, said: “Falling mortgage rates in recent months together with the strength of the labour market has brought more buyers and sellers into the market. There are still fewer buyers in the market than a year ago, but sales are still being agreed with more homes to choose from. 

“Sellers shouldn’t get carried away by more positive data on the housing market and need to price their homes realistically if they are serious about moving home in 2023. 

“Homebuyers remain price sensitive with one eye firmly on the outlook for the economy, the cost of living and the trajectory of mortgage rates which appear likely to edge higher in the coming weeks.”