Written By Em

Following a steady flow of activity across the UK property market in February, the latest Property Activity Index from Agency Express has revealed a pick-up in pace throughout March.

On a month-on-month basis, the report shows nationwide increases in both new property listings, which are up by 14.6%, and the number of properties sold, which has risen by 11.5%.

Looking at the property market performance of specific regions across the UK, Agency Express has found that all of the 12 regions included in the index experienced growth in new property listings, while 11 saw increases in the amount of properties sold during March.

The month’s top performing region was the North East. Rising for a third consecutive month, the number of new property listings was up by 33.2%, while the amount of properties sold increased by 24.6%.

Scotland followed suit, reporting a record best rise for March, with the number of properties sold up by 31.3%.

Other regional hotspots in March included:

New property listings 

• Scotland: +21.6%
• North East: +19.4%
• South East: +18.6%
• East Anglia: +12.7%
• South West: +11.1%

Properties sold

• South West: +21.7%
• Central England: +17.3%
• London: +16.2%
• West Midlands: +11.3%
• North West: +10.6%

The only decrease in March’s Property Activity Index was recorded in Wales. Following a robust start to the year, the number of properties sold dropped by 0.3%. Looking back at Agency Express’ historical data, we can see that the amount of properties sold in March has been consistent for the past two years and that 2016 was the last time the region recorded a drop.

Stephen Watson, the Managing Director of Agency Express, comments: “March’s figures from the Property Activity Index have reported favourably across the UK, with momentum picking up month-on-month.

“However, looking back at data recorded 12 months previous, we can see that year-on-year figures for new listings for sale and properties sold have dipped.”

You can view the latest house price statistics, also for March, here.

Annual house price growth reached 2.7% in March – up from the 1.8% recorded in February, according to the latest house price index from Halifax.

This growth resulted in an average house price of £227,871 in March – the highest price on record.

On a quarterly basis, house prices were an average of 0.1% lower in the latest quarter (January-March) than in the preceding three months (October-December) – the second consecutive decline on this measure.

Month-on-month, prices rose by an average of 1.5% in March, following a 0.5% increase in February. However, Halifax notes that monthly changes can be volatile.

At the same time, the report indicates that mortgages in the UK are at their most affordable level in a decade.

Nevertheless, home sales in February (for which the latest figures are available), stood at 101,000 – unchanged on January. In the three months to February, home sales were only marginally lower than in the same period a year earlier.

Annual House Price Growth up to 2.7% in March

After the sharp rise in the number of mortgage approvals – a leading indicator of completed home sales – in January, they dropped by 4.8% in February, to 63,910. Compared to the same time last year, approvals have fallen by 7%.

And there are no signs that the acute shortage of housing stock available for sale is easing. The number of new instructions has now declined for 24 consecutive months – the worst sequence for nine years, with the figure for unsold stock at a record low. For the 11^th month in succession, new buyer enquiries have also dropped.

Positively, typical mortgage payments accounted for less than a third (29%) of homeowners’ disposable income in the fourth quarter (Q4) of 2017, compared to almost half (48%) in 2007. This fall in the burden of mortgage payments has helped improve affordability for homeowners, driven predominantly by historically low mortgage rates, despite the first base rate rise in a decade last November.

Comments

Russell Galley, the Managing Director of Halifax, comments on the index: “House prices in the three months to March were largely unchanged compared with the previous quarter. The annual rate of growth continues to be in a narrow range of under 3%; though the average price of £227,871 is a new high.

“Activity levels, like house price growth, have softened compared with a year ago. Mortgage approvals are down compared to 12 months ago, whilst home sales have remained flat in the early months of the year. This lack of direction in the housing market is in stark contrast to the continuing strength of the UK jobs market. The unemployment rate is now the joint lowest since 1975 and, in the three months to January, there were 402,000 more people in work compared to a year earlier.

“In the coming months, we expect price growth to remain close to our prediction of 3%, despite the very positive factors of continuing low mortgage rates, great affordability levels and a robust labour market. The continuing shortage of properties for sale will also support price growth.”

The Founder and CEO of online estate agent Emoov.co.uk, Russell Quirk, also says: “While we have seen a tentative start to the year, it would seem that the spring is starting to return to the step of the UK market where price growth is concerned.

“Although market activity over the first quarter has remained fairly flat, there are signs that momentum is beginning to build, and we should see a degree of stability return over the coming quarter.

“The current affordability of mortgages, coupled with a reduction in unemployment and an insufficient level of housing stock, will continue to stimulate the market, and price growth should exceed wider predictions over the latter part of the year.”

Lucy Pendleton, the Founder Director of independent estate agent James Pendleton, continues: “These numbers represent an impressive sprint finish for the first quarter, even if it does match the annual rate of growth for the last three months of 2017.

“Pent-up demand looks to have been given new life in March, despite one of the worst cold snaps in years. The Beast from the East failed to dent the market in the same way it hurt the services sector last month.

“The Halifax alludes to how low unemployment is fuelling demand, but the quality of the jobs created lately makes Stamp Duty breaks for first time buyers away from London and persistent low mortgage rates the most likely causes.”