New research has painted the picture of a “remarkably robust” residential property market that may now be on an upward trend.
This comes despite some suggestions from commentators towards the end of last year that significant falls in sales and asking prices were to be expected throughout 2023.
Property and data insight specialist TwentyCi revealed Q1 2023 saw 269,000 residential sales, with seven in 10 properties listed in Q1 now having sold despite prices remaining 24% above pre-pandemic levels.
While new instructions, sales agreed, and exchanges are all down compared with pre-pandemic levels, TwentyCi said this disguises a significant injection of new supply into the market in March.
They added that, given the “unprecedented coincidence of economic and geo-political shocks”, fall-throughs, price changes, and withdrawals remain “remarkably low”.
“Many media commentators would have us believe the property market is in free fall,” said Colin Bradshaw, CEO at TwentyCi, continuing:
“Whilst the level of transactions and price increases is not matching the volumes or inflation seen in the last three years, a re-calibration was always likely.
In reality the property market has demonstrated a robust performance against significant and determined headwinds.”
Bradshaw said the residential market is emerging as “remarkably robust” from recent shocks:
“With energy costs easing and the potential for a sharp and protracted recession [receding], consumer confidence is likely to return. Should inflation also begin to slide, the prospect of interest rate reductions will also support market momentum.
Whilst doomsday scenarios can’t be ruled out, it seems there is room for that old phrase: ‘cautious optimism’. As energy prices ease and interest rates and inflation look set to be near peaks or trending downwards, stable or upside scenarios have certainly started to look more credible.”
The regional picture
Sales agreed across the whole of the UK were on average 7.5% lower in Q1 2023 compared with Q1 2019. This is broadly reflected across the regions and cities, with only the North East, Inner London and Scotland avoiding negative numbers.
Average asking prices
The average asking price across the UK has remained stable at £420k, and although off the peaks recorded in Q2 2022, this represents an increase of 24% compared with 2019.
All regions have increased over the period, but not all have benefitted equally, with gains varying between 11.8% in Inner London to 32% in Wales.
Availability of residential stock
Despite a fall in Instructions, almost all regions in England and Wales have three or more months of residential stock to sell and levels are now only 9% away from historical norms. TwentyCi said this is a “significant improvement” on 2021, when fiscal and monetary policy had driven excess demand and created record stock lows.
Images: TwentyCi
