Property  

Is it a buyers’ market?

This article is part of
Guide to buying property in a Brexit world

Is it a buyers’ market?

The housing market is commonly referred to as being either a buyers’ or a sellers’ market.

There are many who believe the current indicators all point to a market where the buyer has the advantage at the moment.

So do buyers really hold all the cards? With the turbulent Brexit negotiations beginning to take effect, can it really be a buyers’ market now or for much longer?

The number of properties available to buy on estate agents’ books increased marginally from an average of 35 in July, to 37 in August, reports the National Association of Estate Agents (NAEA) Propertymark.

But that was back in the summer months, when people typically hold off putting their house on the market or searching for a new home, and prioritise enjoying a holiday instead.

Yet, in September, the total number of residential property transactions was down, according to HM Revenue & Customs, suggesting the property market is cooling off.

The total number of deals was 100,850 in September - down 1.8 per cent on the previous month.

Increasing choice

But Jeremy Duncombe, director at Legal & General Mortgage Club, thinks the market continues to be an attractive place for buyers and that this is reflected in the strong levels of mortgage lending activity.

“Over the past year and a half, prospective buyers have benefited from new providers coming to market, including specialist lenders that are improving choice for Britain’s growing self-employed workforce. 

“With the base rate remaining at a record low, we’ve also seen thousands of new mortgage products launched that offer highly competitive rates for new buyers and a chance for remortgagers to make a significant saving,” he reasons.

David Torpey, managing director and chief operating officer at Bluestone Mortgages, observes that those in a strong position to buy are seeing some good deals.

He acknowledges: “This is especially true at the top end of the market, where high levels of stamp duty and a lack of buyers are providing those in a position to purchase top-end properties with good opportunities to negotiate on asking prices.”

There is some regional variation though.

Figure 1: Average house prices by region, August 2017, with monthly and annual % growth

Source: LSL Property Services and Aca

For example, in some of the more expensive parts of London, prices have come off by more than 10 per cent in the past year, points out James Allen, head of Walker Crips Alternative Investments. 

“This has pushed up demand in more affordable districts, causing house price inflation,” he notes.

“Regionally the picture is equally disparate, with parts of the Midlands proving to be property hotspots, but areas a short drive away posting modest falls."