Is It a Good Time To Sell a House
Should I sell or should I stay? The latest authoritative market index, from the Nationwide, shows annual house prices up over 10% despite the cost-of-living crisis, soaring energy bills and the Ukraine war. So, for how long can house prices defy the laws of gravity? That’s the question potential vendors will ask as they ponder whether it is a good time to sell a house in the second half of 2022.
Perhaps I can help by looking at the data behind the headlines – the figures that tell us what the market will be doing after summer is over and autumn begins.
Mortgage Approvals
Mortgage approvals – which happen very early in our terribly slow buying process – are a measure of future buyer activity in months ahead.
Total mortgage borrowing in April (the latest figures available) was a huge £4.1 billion – but that was dramatically down from £6.4 billion just a month earlier. Likewise, the actual number of loans agreed for house movers has now fallen for three months running.
This suggests that buyer numbers will drop in a few months when those mortgage loans in principle show up as completed purchases.
Discounted prices
We’re still in a strong market with most homes selling at or very near asking price but there are a few more exceptions.
Over one in 20 homes had asking prices reduced in April by an average nine per cent, according to Zoopla.
That was relatively normal before 2020 but since the pandemic there have been few discounts, so this change of mood music is worth noting.
Time To Sell
Likewise, it’s taking a little longer for homes on the market to find buyers.
Zoopla suggests that three-bedroom homes outside London – the fastest selling properties for over two years – now take an average of 18 days before going under offer. Back in March it was 16 days.
Of course, under three weeks between putting up the For Sale notice and accepting an offer is still remarkably quick. But it’s not quite as fast as before, so is another under-the-radar sign that change is afoot.
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More homes on the market
An abiding factor of the past two years has been a shortage of homes on sale for the numbers of people willing to buy.
This imbalance means house prices have risen 18 per cent since early 2020 as more buyers have fought over fewer homes.
However, agents across the country tell me the situation is easing with slightly fewer buyers and slightly more homes on sale.
The wider economy
If you’ve received an energy bill recently, or filled the car with petrol, you won’t need me to tell you about the rocketing cost of living.
It will top the headlines this autumn with another energy price rise, more gradual interest rate increases and the debate over what the government could or should do to help.
The combined effect of this is likely to sap a little confidence from potential buyers.
So, what to do?
Please don’t get me wrong: the red-hot market of the past two years won’t disappear overnight.
Potential sellers should, in my opinion, take the plunge but do so sooner rather than later for all the reasons I’ve given.
It’s likely that new vendors will sell quickly for a good price, but don’t take anything for granted. We have tips on the best way to present a home and select an agent, and how you in turn can get paperwork sorted ahead of your next purchase.
We’re at the end of the strongest bull market for a generation but there’s no current sign of a looming crash – just an orderly return to something like normality.
If you’re looking for a professional estate agent, committed to standards of best practices, and regulation as well as offering protection if things go wrong, click the button below and find your local Propertymark member agent.
Last Updated: October 30th, 2024
