The majority of buyers and sellers have continued their plans since the election was called, with the only sign of election caution being a slight drop in the number of new sellers especially at the typically more discretionary top-end of the market, according to Rightmove’s House Price Index.
Over the last four weeks, the number of sales being agreed has stayed steady at 6% higher than a year ago. Buyer demand has also remained stable and is now 5% higher than last year. This supports Rightmove’s poll of over 14,000 people, where 95% of those planning to move home said that the election will not affect their plans.
What’s more, pent-up demand is a key driver behind increased buyer and seller activity, despite mortgage rates remaining elevated for longer than anticipated. In the first four months of the year, the number of sales being agreed between buyers and sellers is 17% higher than in the same period in 2023, outstripping the 12% increase in the number of new sellers coming to market. Like pricing activity, these trends are being driven most by the top-of-the-ladder sector, made up of four bedroom detached and five bedroom plus properties.
A lack of available homes for sale in this sector during the pandemic years, together with the rapid rise, and subsequent volatility of mortgage rates in the post-mini-Budget period, meant that activity in this sector was particularly susceptible to some potential movers taking a step back. Now, with mortgage rates more stable albeit still high, and greater buyer choice, many who had postponed their moving plans in this sector appear to be returning.
Rightmove anticipate the number of completed sales transactions this year to reach around 1.1 million. Rightmove’s key lead indicators suggest positive progress towards reaching this number of transactions. However, the lengthy time to complete a sale after finding a buyer remains a challenge for both agents and movers. The average time between agreeing a sale and legal completion is a painful five months, or 154 days.
In total, it is taking over 7 months on average from a seller coming to market to completing their move, meaning that as early as it may seem, would-be sellers hoping to celebrate Christmas in a new home need to be coming to the market about now.
The “sluggish” completion process in England is something that parliament is reviewing as part of its inquiry into improving the home buying and selling process. When compared with international markets, England’s average completion times are significantly slower, highlighting the substantial room for improvement. The creation of a more seamless process, which includes providing more accurate information about a home earlier to potential buyers, and better connecting the parties involved in the transacting process through technology, are two areas of improvement that Rightmove suggests would be most beneficial to movers. Tim Bannister, Rightmove’s Director of Property Science, said:
“It’s always difficult to predict how home-movers will react to sudden uncertainty, but looking back through our data, we can see that during previous election campaigns, market activity has remained largely steady. This election has followed a similar pattern so far, and the responses from our poll of over 14,000 people also supports the data, with the vast majority of respondents saying they will carry on with their home-moving plans. However, some potential sellers appear to be watching and waiting rather than taking action, evidenced by a dip in the number of new sellers coming to market, particularly at the top-end. This is understandable when many of these sellers have more flexibility over when they act, but overall, it appears to be business as usual for the mass-market.”
Nathan Emerson, CEO of Propertymark stated that it is “extremely positive “to see stability within the housing market and despite a “challenging period of high inflation” and elevated interest rates. He continued:
“…we are witnessing people approach the market with growing confidence. If conditions permit, we are hopeful to see the Bank of England start reducing the base rate when they next meet on Thursday. Should this happen, a potential raft of competitive mortgage deals over the coming weeks would be very welcome news for many people.”
Anthony Coding. RBC Capital Markets said:
“We have frequently said that we see no evidence that elections impact the level of housing transactions, and today’s Rightmove data lends further support to our view that homebuyers intentions are not blown off course by politicans’ hot air. For most of us life goes on as normal, because most of us live outside the Westminster Bubble. Whilst the political debates rage on, in the housing market the number of sales agreed continues to rise and asking prices are steady. It seems that homebuyers are driven by the conditions in the housing market today rather than the promises and pledges being made about the housing market for tomorrow.”
