Transaction levels in England and Wales are up 13% so far in 2013* compared to 2012 and, with the release of some pent-up demand, Rightmove forecasts a rise in average new seller asking prices of between 6% and 8% in 2014. Whether the lower or upper range emerges depends on the supply of sellers who come to market in spring next year. With new listings in 2013 up just 2% on 2012, there is a time-lag between transaction growth and new listing growth leading to a further squeeze on property supply.
Miles Shipside, Rightmove director and housing market analyst comments:
“There’s a listing gap to fill. While sales transactions are up 13% so far in 2013, the number of newly listed properties is only up by 2%. To help mitigate the upwards pressure on prices it is important that home-owners who have a move on their minds make it a new year’s resolution to spring into action. After six years afflicted by the credit-crunch, there’s a definite window to move up or move on in 2014 before the market’s usual pre-election pause in early 2015.”
Ongoing efforts to build confidence among lenders to lend more, so stimulating greater competition in the higher loan-to-value mortgage market, is essential in delivering a sustainable bottom-up market. It is also essential that lending is responsible, and with lenders implementing the Mortgage Market Review recommendations in preparation for the April 2014 deadline, lending beyond a new borrower’s ability to repay is much less likely. These rigorous standards also apply to mortgage applications under phase two of Help to Buy, the government-backed mortgage guarantee scheme for existing homes.
“With Rightmove experiencing a 21% year-on-year increase in traffic, there is a definite sign of more people sizing up a move. Early spring marketing is the best option for trader-uppers as upwards price pressure could build if stock for sale continues to dwindle. The jump to the next rung of the property ladder could get wider, especially if those who do not have anything to sell can afford to jump in ahead of you. With mortgages still historically cheap and interest rates set to remain stable, if you’ve been putting off a good reason to up-sticks, it could be opportune to make 2014 the year to move.”