Any landlord quitting the market and selling up may find demand from buyers muted until Easter.
That’s the warning from Zoopla which says that while demand in early 2023 so far has been in line with pre-pandemic levels, a portion of buyers are holding off entering the market and waiting to see if house prices and mortgage rates start to fall more quickly.
In its latest market snapshot the portal says demand for homes has rebounded in the first weeks of January but is more of a slow burn than in recent years.
The scarcity of supply in the sales market is also reversing - the average estate agent now has 23 properties for sale, up from a low of just 14 homes in early 2022. This will not only provide more choice for would-be buyers, but it will also reduce the pressure on prices.
Zoopla warns that a key risk to overall sales volumes for 2023 is unrealistic seller expectations. Serious sellers will need to ensure their home is competitively priced in order to secure a sale - however as the majority of homeowners have made sizeable gains in their home value over the pandemic, there is more room for realism on pricing.
Value-conscious early buyers have apparently shifted their buying preferences towards flats with over a quarter of new buyers (27%) now looking for one and two-bed flats, up five per cent in comparison to a year ago.
In contrast, the share of demand for three-bed houses has fallen five percentage points to 39 per cent, although they are still the most in-demand homes across the UK. This is a trend we are seeing across all areas of the UK in the first few weeks of the year as early buyers seek better value for money. In London, one- and two-bed flats account for 49 per cent of demand, up from 42 per cent a year ago.
The snapshot reports: “Buyers will remain cautious in the next few weeks before an anticipated pick-up in demand after Easter when a clearer picture emerges. However, much depends on the economic outlook, the strength of the labour market and the trajectory for consumer price inflation.
“The pressure on incomes, combined with the costs of running homes is also likely to drive a certain amount of movement in the market in 2023. Sizeable amounts of embedded equity in millions of homes may also encourage more down-trading to release equity and cut running costs - further supporting home moves in 2023.
“In the short term, low single-digit price falls in H1 2023 are anticipated, but the housing market is in better shape to deal with the headwinds than in previous economic cycles.”
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If it’s a desirable property at the right price… it WILL sell 💰💰. The problem is vendors being stuck in the past and over inflating the asking price.
I can understand buyers waiting until they see that the Bank of England loose their appetite for putting up rates.
However, once this happens, lenders will give a better 5 year deal in order to get business.
Then of course we will see a surge of buyers to get a property to get out of the cycle of higher and higher rents.
Prices will of course then go up. I don't see a massive rise in prices but it will be better than you can get now. As way of an example a property i've got in Bedford, been told if I want to sell put it on at offers over £280,000. In Summer of last year they were selling for between £310,000-£325,000 depending on condition.
I will do a short term let with 2 occupants to mitigate my costs as I do a light re-furb on this property and then wait for the head winds on selling to change.
Any person wanting to buy should get some cheeky offers in now. Some are really struggling, whether a homeowner or Landlord and will be relieved to sell and not to the sharks out there offering low low prices for houses as a cash purchase in 30 days!!
Nothing wrong in bidding sellers in the balls, you'll be surprised how often it works.
Yes I agree the market has slowed / ground to a halt and buyers are expecting prices to be lower than last year. I'm not currently selling but when I do I always sell at a reasonable price (not usually to an investor) and I do find those very low offers from investors to be insulting. Eg property worth £150K sells for say £144K as needs a bit of work, offers of £130K from investors.
Don't be insulted by the offer, if you don't need to sell laugh at it, I'm going back a long time but I bought a corner shop (cafe) on the market for £40k I offered £30k, the guy kept refusing my offer until one day he accepted and we dealt, turned out the Indians down the road wanted it as a take away and had been trying to buy it for £27k, you can't blame people for trying it on, sometimes it works
Yes I know I can tell them to go away, but its still annoying!! I can understand it on scruffy properties needing a lot of work, and in a buyers market, but they still do it on properties that only need minor works.
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