Rightmove reports that bottlenecks at every stage in the process of moving are causing house sales to take far longer than usual.
In the latest monthly market snapshot, the property portal states that there are around 40pc more sales in transit to completion than a year ago, due to gridlock in the mortgage, conveyancing and removal sectors. Tim Bannister, director of property data at Rightmove, hears of problems at all levels, such as staff shortages among lenders and conveyancers reducing capacity.
The end of the stamp duty holiday, currently March 31, 2021, makes urgent the need to achieve completion by this date, requiring buyers and sellers to work hand in hand with their agents and ensure they complete documents and respond to questions without delay.
If possible, Mr Bannister added, buyers and sellers should plan for a minimum of one extra month to allow for the current delays in the process, as time is already running out for agreed house sales to be completed before Christmas.
Regions show largest price increases
For the time being, the portal’s regular price index reveals that the trend towards trading up to a larger property has continued at full tilt over the past month, resulting in record asking prices for three- or four-bedroom homes.
Buyers seeking larger homes, both those who require additional space for their families and those wanting room to work from home, have driven these record highs. Generally, prices have remained stable since they reached a peak in July, increasing by a fractional 0.2pc on the month and by 5.0pc annually, the highest annual rate of growth since September 2016.
Regions outside the South East have experienced the strongest price surges, with the East Midlands, North West, North East, Scotland, West Midlands and Yorkshire & the Humber all setting new records. Additionally, the desire for more spacious homes is evidenced by the volume of sales being agreed by agents compared to this time last year, according to Rightmove.
The greatest demand is for detached homes with four or more bedrooms. Compared with the same period last year, house sales agreed in this category more than doubled in August, soaring by more than 104pc. By contrast, sales of three- or four-bedroom homes, excluding four-bedroom detached, jumped by 55pc.
Even the first-time-buyer market, homes with two or fewer bedrooms, although not as robust as the larger homes market, saw agreed sales climb by 36pc.
Fourth bedroom now a necessity
Mr Bannister believes increased competition for the middle tier of homes, among those wishing to trade up, has propelled prices to record levels this month. The need for more space has usually been the prime reason for moving house, but the new requirement to be able to work from home means there are more buyers competing for the same type of property.
For example, in the New Year, a fourth bedroom was regarded as a luxury for buyers trading up, but has now become a necessity for those able to do so.
As asking prices are generally only a few hundred pounds less than July’s record and buyer demand remains sky-high, consumers looking for their next home are likely to find only offers close to the asking price will be considered, especially for larger homes.
Nationwide, despite the lockdown, house sales agreed for the year to date fell by only 5pc compared to the same period last year.
Two regions, the East of England and the South East, have already surpassed the number of sales agreed for the same period last year, due in part to higher average prices resulting in the stamp duty holiday creating more interest among buyers and sellers in these regions.
Two-speed market in London
In London, however, sales agreed for the year to date have declined by 3pc with a two-speed market in operation. While there is vigorous sales activity in Outer London, especially for the top tier of homes, the market for first-time-buyer homes is subdued, with sales down by 14pc for the year to date, compared to the same period last year.
The buoyant activity in Outer London has enabled the capital to restore its position as the second fastest region for the average time taken to secure a buyer, only pipped at the post by Scotland at 35 days.
The average time taken to agree a sale in London is now 49 days, substantially less than the 69 days it took at this time last year. Nationally, the average time taken to secure a buyer fell from 62 days in August 2019 to 53 in August this year.
