Sellers flood back as the housing market rebounds
David Hannah, Group Chairman at Cornerstone Tax, discusses why sellers are coming back as the housing market rebounds.
Despite the recent spike in mortgage rates and fall in house prices which started at the end of last year, new reports show that sellers are now flooding back to the market in a surge of new confidence.
Recent data shows that the number of houses for sale has reached its highest level in 27 months.
Group Chairman of property tax experts Cornerstone Tax, David Hannah, states that the market is showing signs of both a buyer and seller-friendly environment once more and that opportunities are there for individuals ready to take them.
The issue of dwindling stock which saw a scramble for homes in the UK, may be coming to and. Estate agents have reported that there were 35 homes for sale per branch in March. This was the highest number of homes for sale per branch since January 2021 – a year ago, there were just 20.
The increase in the supply of homes will be welcomed news for buyers. Those affected by rising interest rates on mortgages, including first-time buyers, have begun to show signs of a return to the market due to the fall in fixed-rate mortgages. In October 2022, average fixed mortgage rates peaked at 6.65% for a five-year fix and 6.52% for a two-year fix.
According to Moneyfacts, five-year fixed-rate deals are now at an average of 5.04%, causing renewed optimism in the market for prospective buyers.
Hannah believes that the renewed confidence in sellers who are looking to move into their next home, coupled with the fall in mortgage interest rates, has pushed property prices to a reasonable level.
This has encouraged a wave of buyers back to the market resulting in the number of sales being agreed to increase, with the average number of sales back to pre-pandemic levels in 2019.
Despite calls for a market crash from industry experts, Hannah maintains that, with the encouraging figures, the market will grow between 6-8% by the end of 2023.
David Hannah, Group Chairman of Cornerstone Tax, explains:
“The UK is going through a re-adjustment period regarding property prices and is slowly adapting to the new rates of mortgages.
“However, we are already beginning to see a fall in fixed rate mortgages, which has resulted in a wave of buyers returning to the property market.
“There are now real opportunities for those ready to take them.
“We are in a situation where sellers have renewed confidence in the market, which has resulted in more properties becoming available.
“This means prices are falling to an affordable level and buyers now have more choice.
“There will be no crash and no 7-10% fall in property prices that we saw in the noughties.
“Over 2023, I expect to see low to mid to single-digit growth in the UK property market.”
Kindly shared by Cornerstone Tax
Main article photo courtesy of Pixabay
