Total sales stock in England and Wales increased again for a ninth consecutive month since the all-time low set in February, although the current total remains around 100,000 short of the 10-year average, according to Home.co.uk’s Asking Price Index for November.
Asking prices across England and Wales slid for a third consecutive month (by 0.5%), bringing the year-on-year rise to 3.6%, consistent with seasonal expectations.
Meanwhile, the stock of unsold property has increased by 39.3% over the past 12 months.
But by contrast, the stock of unsold property in Greater London has only increased by 3.5%.
The Typical Time on Market (median) for unsold property in England and Wales rose a seasonal three days to 70 days since last month, but is 10 days less than in November 2021, despite pricier mortgages.
Home.co.uk said: “The UK stock of unsold property on the market is well on the way to recovery following the unprecedented buying frenzy that depleted agents’ portfolios by around 50% in the wake of the Covid lockdowns.
“While there is still some way to go before stock levels return to the 10-year average, buyers can benefit from a growing choice of property for sale and be reassured that vendors now have less bargaining power than they did.
“Higher stock levels naturally put downward pressure on price growth which is vital for a resumption of more normal market conditions.
“The market still retains much momentum despite the headwinds of higher mortgage rates and economic turmoil.
“Both the median and mean time on market for unsold property in England and Wales are less than they were a year ago.
“Of course, some slowing is inevitable over the winter months and we can expect next year’s market to proceed at a more leisurely pace.
“However, we expect demand to remain significant, especially given the new nil-rate stamp duty rate for properties under £250K.
“UK property is still very attractively priced in US dollar terms and yield-hungry international investors will be drawn to the extremely buoyant rental market.
“London will be of particular interest due to soaring rents and the opportunity for significant capital gains. The fact that the median price of a two-bedroom flat in London is currently 10% less than it was in 2015 indicates that there is considerable room for growth.
“Meanwhile, inflation continues to erode home prices insidiously. In real terms, growth is currently around -10%, effectively correcting overinflated home prices without adversely affecting banks’ balance sheets. Concomitantly, the fact that real mortgage rates are significantly negative is a distinct peculiarity of this market.
Whilst there are some initial indications that rents are stabilising across several regions, they continue to soar in London due to scarcity. The wild rise in rents that started in the more central boroughs has now mapped out to the outlying administrative areas. Greater London has currently a mere seventeen thousand properties to let. Five years ago, there were around forty-five thousand advertised as available for rent.
“Mortgage rates are now beginning to stabilise following the chaos triggered by Truss’s ill-conceived mini-budget. Sunak’s appointment seems to a have soothed the financial markets for the time being, but more such crises are to be expected given the levels of government debt and systematic economic woes.”
The annualised mix-adjusted average asking price growth across England and Wales is now at 3.6%; in November 2021, the annualised rate of increase of home prices was 6.9%. Incidentally, that was the month when real asking price growth went negative.
