The supply of new properties for sale in 2022 returned to the ‘norm’ of 2019, according to new research from TwentyEA.
The data reveals that supply was 4% down on 2019 as a whole. Although in the first seven days since Boxing Day, there has been a 33% increase in supply compared with 2019.
Demand has been gradually tailing off since May 2022, 3% down on 2019 as a whole. Looking at just December 2022, demand was 10% down on 2019, but this was 18% down in October 2022 after the disastrous mini-budget.
Sales triggers by price band
In 2022, property was more likely to sell in all price bands than in 2019. The lowest priced property (<£200k) was most likely to sell, where the ratio of demand to supply was 92%. The highest priced properties (>£1m) were only 52% likely to sell, but this is still higher than the last ‘normal’ year of 2019.
Average asking prices
Average asking prices in 2022 rose by 8.5% (or £31.5k). The current UK average asking price is £404k. December 2022 saw a fall of 2% on the prior month. Prices are likely to fall this year, but even a 10-15% fall still leaves us above pre-pandemic levels
Average time to sell
Average time to sell a property has fallen dramatically. In December 2022, half of all properties sold in 35 days (median). This was an uptick from Nov 22 (29 days) days but more importantly, it is still 27% lower than the 48 days in December 2019 . Note – Time to sell is measured by the lag in days between the instruction date and the first sale agreed date
Stuart Ducker, strategic solutions director of TwentyEA, commented: “We have been in a brief period where the volume of properties for sale were at an all time low. For Sale stock has recently started to rise since Boxing Day, but we are still 100k short of 2019 ‘normal’ levels. The volume of properties with ‘in flight’ transactions is currently 380,000.
“Average weekly net house sales in the UK. 2022 were almost identical to volumes recorded in 2019 and 2016, with 2020 and 2021 being exceptional years.
“New Instructions will remain sluggish and subside by just over 3% on 2022 and we are expecting to see 1,500,000 instructions in 2023. Sale SSTCs will fall by around 18% on 2022 numbers as the cost of living crisis fuelled by the war in Ukraine and Brexit takes hold. This year we expect to see 1,008,000 SSTCs. The most important thing however is transactions, because they drive revenue.
“From 2014 to 2019, the UK has seen about 1.2 million transactions per annum. This might be defined as a ‘normal’ market, comparable with HMRC transaction volumes.
“In 2020, transactions fell by 11% on prior year. Due to the initial pandemic lockdown affecting specifically the first 6 months of transactions. Stamp duty holiday was announced and began on 7th July 2020. Since then, market demand has been exceptionally high. A 41% increase in the volume of transactions in 2021, the like of which had not been seen since the global financial crisis of 2007-2008.
“Finally, we forecast 2023 transaction volumes will be 1,108,776. This is prudently based upon the low October-December 2022 demand.”
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